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How should you go about creating a business strategy? How do you make sure that your strategy is worth committing time and money to?
Tribal Leadership authors Dave Logan, Halee Fischer-Wright, and John King contend that creating a values-aligned business strategy is vital as you work to unite your tribe. To develop your strategy, you must have three specific discussions with your tribe. Also, your strategy must pass three tests if it’s to be complete.
Read more for Tribal Leadership advice on how to create a business strategy.
Create a Values-Aligned Business Strategy
As you build your tribe, create a business strategy that further unites the tribe. According to the authors, a tribal leader must balance the tribe’s needs and the business’s needs—accounting for human well-being as well as making good business decisions. If you don’t account for both, you risk alienating the tribe or struggling to find business success. So, when creating your strategy, always listen to feedback and adjust accordingly. This helps tribe members feel heard and valued. The author’s advice for how to create a business strategy includes directions for specific meetings with your tribe and three ways to validate the soundness of your strategy.
(Shortform note: In Good Strategy Bad Strategy, Richard Rumelt explains that an effective strategy uses your strengths against an opponent’s weaknesses. With this in mind, consider both the strengths of your tribe and your business’s unique strengths. Taken together, they’ll help you craft a strategy that can direct great power against your obstacles.)
The Three Discussions You Must Have
The authors recommend using their three-part approach to business strategy: Develop your strategy by meeting to discuss your desired results, your resources, and the actions you’ll need to take.
Discussion #1: Decide on your desired results. In a conversation with as much of your tribe as possible, figure out what specific results you want to achieve. Listen for shared ambitions and articulate what you hear. When you put this underlying ambition into words, tribe members will often have an “aha” moment and feel you’ve put your finger on just the right thing.
In addition, the authors explain that results are distinct from goals. Aiming for a goal implies that at present, you’re already failing and need to stop. In contrast, assume that you’re already on the path to success and simply not there yet—this is what the authors call a result or “outcome.”
(Shortform note: Rumelt also explains that a bad strategy fails to name the problem. In Tribal Leadership, the authors focus on desired results rather than the main challenge. To complete this approach, consider the main obstacles you face and the results you want to achieve. For instance, a startup founder might need to secure funding, position and differentiate her company, and build a strong team. With these challenges identified clearly, she can then aim toward her desired results more accurately.)
Discussion #2: Gather your resources. In a separate conversation, brainstorm what resources you have at your disposal. Resources are everything from material assets—buildings, tools, technologies—to skill sets, connections, and intangibles like brand recognition or past successes. The authors recommend considering two types of resources:
- Type #1: Foundational resources. These are things such as unique skills, connections, or qualities that are a core part of your tribe’s nature. For instance, your tribe might be full of experienced innovators, and that’s a valuable skill. Since these resources are easy to take for granted, ask outsiders who can see your tribe’s blind spots.
- Type #2: Reciprocity. This intangible resource refers to whether you and your customers understand one another. When a business and its market acknowledge that they mutually need each other, that sense of reciprocity bolsters your business. Test for reciprocity by asking people outside your tribe to describe how they see it.
(Shortform note: Once you’ve gathered your resources, Rumelt recommends directing them toward a focused, well-defined goal, such as overtaking a competitor in a key marketplace. By focusing all your resources in one direction, you direct your strengths toward the competitor’s weaknesses. Rumelt suggests doing this at “pivot points,” or areas where you can leverage your strengths to create an imbalance in your favor. For instance, a video game studio might have strong foundational resources, such as innovative product designers, and strong reciprocity with their fans; by launching an ambitious, long-awaited game announcement at a pivotal point in the year, they could shift attention away from competitors and toward them.)
Discussion #3: Plan action steps. To make your strategy actionable, the authors suggest that you brainstorm the individual actions or efforts the tribe must undertake to achieve its desired results. Consider everything from smaller-scale plans—such as gathering marketing data—or tribe-wide behavioral changes, such as developing a more productive workflow. To compensate for mistakes, devise a plan A and a plan B, in case things go awry.
(Shortform note: When planning action steps, don’t stop at making a list. Rumelt suggests that an action plan should integrate all sub-plans into one well-crafted design—a dynamic whole, like a car engine, where many parts work in tandem to produce something more than the sum of the parts’ actions. To do this, consider how your steps fit together—for instance, how a marketing team’s tasks fit with the product designers’, the software engineers’, and so on.)
A Strategy Must Pass Three Tests
Until your strategy passes the authors’ three tests, they contend it’s incomplete. By validating the strategy, you ensure that it’s worth committing time and money to, and you motivate the tribe to action.
- Test #1: Do you have enough resources to achieve your desired results? If you lack sufficient resources, brainstorm ways to obtain what you need and get those resources before trying to execute your strategy.
- Test #2: Do you have enough resources to implement your necessary actions? If yes, move on to the next test. If not, try to identify any resources you may have overlooked. Otherwise, the authors recommend looking for ways to optimize your operations—for instance, by helping reliable employees to develop new skills as opposed to hiring to fill that same need.
- Test #3: Will the action steps accomplish your desired results? Scrutinize whether the actions you’ve outlined are realistic enough to work. Encourage your team members to share their doubts by giving specific concerns, and if necessary, brainstorm additional actions to take.
Once you’ve built and validated a strategy, the tribe will often ascend to Stage 4. According to the authors, building a viable strategy unifies the tribe and creates enthusiasm. Now you can begin to implement your action steps. Focus on executing your behaviors. In the face of setbacks, stay resilient and reorganize the tribe around a readapted strategy.
|Avoid Excessive Planning|
In Nine Lies About Work, Marcus Buckingham and Ashley Goodall contend that strategic planning, like the above method, doesn’t always lead to success. They explain that leaders often devise large, top-down strategies based on inaccurate assumptions about how things will play out. Because such strategies are based on ideals rather than reality, teams inconsistently execute them—that is, they simply don’t work.
To avoid foundering with a large, clunky strategy, Buckingham and Goodall recommend staying agile. Agile companies use a flexible, lightweight strategy that centers on adaptation and communication. By taking action every day and staying attuned to what information a team needs and how they’re doing, an agile leader guides her company via quick, frequent pivots. This allows the company to navigate the complex world of business and competition, and it saves time and energy otherwise spent coordinating the various parts of a complicated and demanding strategy.
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