How to create clear and effective strategy

“We have to be strategic about it.”

Today in business, the term “strategy” or “strategic” is mostly used as an adjective to make ideas sound important. In fact, in most everyday business contexts it has lost its usefulness. 👇🏼

What is strategy, really?

A strategy is a collection decisions and actions you take to achieve a specific goal.

For example, Southwest Airlines decided to…

  • Serve no food
  • Use one type of airplane
  • Have no seat assignments
  • Hire engaging flight attendants to be themselves
  • Use point-to-point routes between midsized cities

…to be a preferred, low-cost, profitable airline.

A good strategy is clear when the decisions and actions to be taken build up to support the ultimate goal. Good strategy can be applied to any level of a solution – to your short term goal, a new service solution or the company strategy.

In many ways, good strategy is good design.

Here’s a simple approach to help you and your team develop clear strategies and communicate it easily.

1. Break down your main goal into 5 to 7 smaller ones

Strategy is built in a simple hierarchy.

Main goal <- subgoals <- decisions or actions

In the Southwest example, “the preferred, low-cost airline” is the main goal. But it would be difficult to list all the decisions and actions to achieve that goal. Break it into a few others: Limited passenger amenities, fun flying experience, high efficiency ground operations.

2. Start a bubble diagram with the subgoals

You’re going to build this visually to increase engagement with others.

Spread the subgoals out on a page or board. Starting with one, brainstorm decisions or actions you could take to achieve the subgoal. Decisions or actions should answer the question, “How can we best achieve that goal?”

Each subgoal should eventually have 5, 7 or 10 possible decisions or actions associated with it.

3. Ruthlessly evaluate, edit and refine

Now you have an initial set of decisions and actions to assess. It’s time to evaluate which decisions and actions are the best. Best means:

  • It actually helps achieve the subgoal
  • It is a cost-effective and distinctive way to achieve the goal
  • It supports other subgoals, reinforcing the strength of the strategy
  • It is clear that you could execute (make or buy) against it

Prune and edit in multiple iterations to refine the strategy. Revisit each subgoal and assess the decisions and actions. Add, delete, refine. It is OK that this take some time.

A great strategy guides quality work over the long term.

Despite “strategy” becoming a watered down term in business, it is an essential concept that is critical to forming high quality plans. Use this simple approach to build powerful strategies.

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