Leading the Way: Defining Strategy
How Much Time Should Organizations Devote to Strategy?
Can your organization truly operate effectively without a clear destination and purpose? This question often arises in discussions about strategic planning.
Recently, the BBC’s In Business correspondent, Tanya Beckett, moderated a debate on the time managers spend in meetings. It prompted another important question—what is the purpose of these meetings? Are they the most time- and cost-effective means for information exchange? Or do they serve as platforms for problem-solving and decision-making by bringing the right people together?
One thought-provoking comment was that organizations most effective at using meetings for decision-making tend to be the most productive and decisive. Conversely, it is easy for meetings to become avenues for procrastination, delaying decisions, and slowing down actions.
The Importance of a Clear Vision
To develop a robust strategy, top management—both executive and non-executive—must be clear about the long-term aspirations and goals of the organization. Often referred to as the Vision, this concept may not be precisely defined but must be understood and shared by senior decision-makers and, eventually, all staff. Transforming a vague idea of the future into specific, measurable, and achievable objectives, including financial results, helps focus efforts.
The next challenge is selecting the best ways to achieve these objectives, recognizing there is never just one way. Strategizing involves defining various options and selecting the one deemed ‘best,’ leading to the development of a comprehensive corporate strategy.
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Breaking Down Corporate Strategy
In multi-product, multi-region, or multi-service organizations, the corporate strategy can be divided by business unit, region, or products/services to set objectives at a more localized level. Aligning these lower-level objectives poses many challenges, as they may lead to conflicts of interest or competition over resources.
Even if top management is clear about the desired destination, they must assess how the external environment could help or hinder the journey. No management team has a crystal ball to predict the future.
The process involves making educated guesses, assessing risks, anticipating ‘black swans,’ and determining what is most likely to impact the achievement of desired outcomes. Business schools and consultancies provide analytical tools to help management teams consider a range of potential risk factors. These tools are most effective when the team challenges current thinking, recognizes potential psychological biases, and supports an open exchange of ideas.
The Role of Meetings in Strategy Development
This brings us back to meetings. Organizations with a clear purpose and well-defined roles and responsibilities are likely to use meetings effectively for decision-making. When priorities are unclear, managers may avoid decisions for fear of making mistakes, fostering a culture of procrastination and hindering effective strategy implementation. Senior management must lead by describing the future, clarifying the chosen path, and continuously monitoring the external environment.
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Conclusion
Developing a strategy requires time, effort, and a clear vision. It involves understanding the external environment, breaking down corporate strategy into manageable parts, and using meetings effectively for decision-making. By focusing on these areas, organizations can create a robust strategy that drives success and growth.
