Friday, April 4, 2008

Your Strategy (or Lack Thereof) Makes a Statement: Employees Need a Clear Strategy Statement to Follow

The other day, a colleague and I were discussing a formerly family-owned manufacturing company that was recently sold to a private equity firm. With such a big change, there was a real challenge for the new leadership to come in and smooth out the transition with employees. The key? First, articulate a strategy for success in 35 words or less.

That’s one of the top jobs of a company leader. And yet, many CEOs can’t readily identify their strategy, according to an excellent piece in the latest issue of the Harvard Business Review, “Can You Say What Your Strategy Is?” (you’ll need to agree to the terms and conditions to read it).

If the chief can’t say what the strategy is, then how likely is it that anyone else down the line will understand it, either? And how will they be able to work in ways that support it?

This represents a major missed opportunity in internal communications. But the HBR article details a few strong examples of companies with unique strategies that are well defined and well followed. Consider, for example, Edward Jones, and its successful against-the-grain approach of one very hands-on financial advisor per office—often in a rural location overlooked by other firms.

So how can you embark on a similarly successful path? The HBR piece also offers a good primer on the basic tool of marketing communications that starts it all: a powerful, succinct strategy statement.

A note on that strategy: It should be based not on what your competitors are doing (that tired “me, too” philosophy), but on what’s best for your company to do. The HBR calls it your “sweet spot,” the intersection of your company’s capabilities with your customers’ needs. At Scheibel Halaska, we usually refer to this approach as being a “hedgehog”—as in the ancient Greek parable: “The fox knows many things, but the hedgehog knows one big thing.” For the uninitiated, this term was popularized by Jim Collins in his best-selling book, “Good to Great: Why Some Companies Make the Leap … and Others Don’t.”

If you’re a CEO or in any other leadership position, the HBR article (and Collins’ book, while you’re at it) should be required reading. Hope the leader of that manufacturing company we were talking about gets a chance to read it, too.

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