From revisiting and updating the underlying assumptions about your business, markets and competitors, to the vexing issues of deciding what to do and what not to do, it’s no surprise that many management teams avoid this work and focus more on incremental operations planning and improvement. However, for those who are courageous enough to go down this important path and do the heavy lifting, here are my top 10 pitfalls and speed bumps to avoid during your journey.
10 Places Where Management Teams Misstep on Strategy
- They Over-Admire the View from Their Window. The Inside-Out View that too many teams rely on is a giant decision-trap waiting to swallow the business. Always strive to cultivate the Outside-In perspective. It’s hard work and takes time and help. And yes, it is priceless.
- They Equate Action with Progress. Action doesn’t equal vector. Strategy is all about choosing specific vectors and ignoring others. Many management teams cut through the front-end of the work in a rush to action, instead of asking and answering the tough questions about their business.
- Strategy Vocabulary Babble Boggles and Bewilders. Ask 10 executives how to define strategy, vision and value proposition and watch the fun begin. Ask them what business they are truly in and how they differentiate from competitors and the discussions can go haywire. Work hard to establish common terms and definitions up-front.
- Warning, Rapid Descent! Discussions Rapidly Descend to the Operational Level. Along with the Rush to Action, it is common for the discussions to dive deeply into operations long before the hard questions have been asked and answered.
- Teams Experience a Power Shortage. Instead of focusing on how to create power…that is to create new revenue, capture new customers, grow faster than the market and grow profits, the discussions emphasize incrementing off of old power sources. Finding “new power” is critical to every firm and must be the focal point of every strategy process/discussion.
- They Delegate the Deep Thinking to Consultants. I strongly advise using outside help to guide the process work … to ensure that the teams focus on creating power and fostering an outside-in approach. However, don’t fall into the trap of expecting the consultants to be able to tell you what might be your best next steps. Let them help you find the way forward … and don’t shirk your responsibilities to make the hard calls.
- Too Many Teams Forget to Involve the Right People in the Process. While those at the top of the pecking order own the final calls, there are many, many people in your organization with insights to share and ideas to proffer. Find a way to engage and solicit input. And since these are the same people who will carry out your new directions, early involvement reduces some of the natural barriers to change. Strategy is a full-contact sport across the organization!
- They Falsely Expect Sure-Fire Miracles to Emerge. Strategy is nothing more than a series of educated hypotheses backed by intelligent experiments. Instead of expecting the Ah-Ha moment (they happen sometimes, but don’t count on it), look at strategy as a series of experiments designed to build power. Of course, don’t forget to build in the feedback and learning loops or the experiments will go nowhere.
- They Lack the Leadership to Make Asymmetrical Bets. This is Geoffrey Moore’s terminology from “Escape Velocity” and I strongly believe he is right. If management is struggling to find new sources of power, the right choices will often be those that are different, radical and perceived as highly risky. It takes true leadership to stare asymmetrical bets in the eye and move forward.
- It’s Never Just an Event! Strategy is a process, not an event. The annual offsite is fine, as long as the issues and experiments and engagement on strategy and learning is happening all of the time.
The Bottom-Line for Now
In my experience working with many management teams, it takes incredible fortitude and discipline to steer clear of the Top 10 and keep the process moving. Use the list above in good health. Reference it frequently as a reminder of the pitfalls and traps. And of course, feel free to add your own. Focus on this, and you’ll uncover a number of other traps along the way.
And yes, then there’s number 11 … this little problem with Strategy Execution. That however, is a topic for another day.
This blog originally appeared at artpetty.com.