April 11, 2007
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How to Guide: Making strategy a habit
IDENTIFYING YOUR STRENGTHS AND WEAKNESSES Previously in this column, we discussed the first two steps in the strategic planning process –1) getting ready and organized, and 2) articulating your mission and vision. What follows next in that process is reviewing your strengths and weaknesses. You may already be familiar with the trusted business planning tool called the SWOT, but as a quick review, SWOT is an acronym that stands for Strengths, Weaknesses, Opportunities, and Threats. These key factors are crucial in assessing your organization’s strategic position. You’ll want to build on your company’s strengths, shore up the weaknesses, capitalize on any opportunities and recognize any threats that may exist. Your organization's strengths encompass everything that your company does well. Ask yourself what the company's capabilities, skills and resources are that you can draw on to execute plans and actions. Consider your human and organizational capital, the company financial resources, and operational processes. This should be your assessment of what's working in your organization. To see if your organization is making the grade, go to The Business Report Card at www.mybusinessreportcard.com Your
weaknesses, conversely, encompass those things that are holding
your company back from achieving your goals or serving customers.
Ask yourself what might be hindering your organization from
reaching its full potential. What are the impediments to your
success? Maybe your technology management is outdated or perhaps
your employees aren’t working together optimally as a
team. Or consider your employee retention rate. Does your organization
spin its wheels hiring and training employees only to lose them
within a short time? |
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Once you have identified your strengths and weaknesses as part of reviewing your strategic position, it’s important that you get everyone involved in the strategic planning process to agree on priorities. This next step should be fairly easy, but don’t underestimate the value of consensus. The one concept that most business owners, executives, and managers forget is that the lack of a decision results in more derailments of the mission than any other cause. Don't get caught up in a search for a single method of evaluating all the strategic choices that may be in front of you. There is no single fail-safe method. Instead, set some parameters or rules that are specific to your operating environment and use them to evaluate your strategic choices. Some categories of rules might include the following: PRIORITY RULE: You may prioritize some opportunities over others based on their connection to reaching your vision. TIMING RULE: You may prioritize opportunities based on how much money you want to see returned in a set time period. -BOUNDARY RULE: You may prioritize every opportunity based on whether it is aligned with your organization's core mission and values. HOW-TO
RULE: You may qualify opportunities by first sketching out
potential implementation strategies before committing to them.
If you can't clearly define an action plan, you know that
trying to execute it will likely go poorly.
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Starbucks is viewed by independent coffeehouses as the Evil Empire. But industry surveys show that most indies going head-to-head with the Seattle-based giant don’t just survive, they do better than ever. Really - it's true! "Starbucks forces [independents] to stay on their toes, get creative, exploit their advantage of being more nimble,” says consultant Bruce Milletto, president of Bellissimo Coffee Infogroup of Eugene, Ore. “Starbucks provides a safe place to have your first latte,” he says, explaining that specialty coffee is still a young industry with plenty of room to win new converts. When those latte novices are comfortable with their specialty brews, many will try, and perhaps prefer, the nearby independent. "There’s a delicate balance between the synergies [two combatants] can generate on one hand and too much competition on the other,” says Joan E. Primo, a principal of real estate and retail consultants The Strategic Edge of Southfield, Mich. “You have to ask yourself whether there’s enough pie for everyone.” In other words, it makes sense to welcome battles for market share that make the pie bigger for everyone; but battling for a bigger slice of a pie that’s not growing is a zero-sum game. That’s why Starbucks has done its rivals a favor, says David J. Reibstein, a professor of marketing at the Wharton School. By building primary demand—demand for a category of offerings, in addition to demand for a particular brand—Starbucks has given the entire sector a shot in the arm. Quotes: From
the Harvard Business Review
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