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First things first.

I've been helping a large outdoor goods company with its strategy development. The CEO has been struggling to move the process forward for a few months now, and he turned to me for outside perspective. It became quickly apparent that his difficulty was not with the process per se. The difficulty was rooted in the lack of a clear direction: what does his company represent, and where does it want to go in the next 5-10 years? You can't develop a strategy until you can answer those questions.

I'm personally fond of the approach Jim Collins described in Built to Last. He suggests that you first clarify your core values and purpose, and a "big, hairy, audacious goal" that will take you 10-30 years to reach. (Read more about it in this HBR article, and download this helpful worksheet from his website.) Now, not many companies are ready to commit to a 10-30 year goal, but there's no reason you can't modify it by setting a 5-10 year goal.

I haven't consulted to them, but my guess is that both Nike and Patagonia have absolute clarity in these areas, and as a result they're able to set -- and change -- their strategies as needed to attain their goals. Their strategies are documents designed to help them create their envisioned future. As for what particular tool or process they use to develop the strategies? Who cares. There are a host of approaches out there, any one of which will do an adequate job. And since strategy is flexible -- It has to be, since external conditions change so frequently -- it doesn't really matter which you use. The critical part is defining who you are and where you want to go.

Following a strategy without first having a core ideology and a clearly defined goal is like following a compass without a magnetic needle pointing north. You'll certainly move, but you have no idea where you'll go.


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Strategy lessons from septuagenarian mall-walkers.

I used to work at Asics many years ago, where the strategic direction was to focus on the serious athletic enthusiast. We made wonderful, relatively high-priced (and high-margin) shoes that addressed their needs. Unfortunately, we also wanted to chase the sales volume that major retailers like JC Penney and Kohl’s could provide. That required us to make low-priced, low margin shoes. Our designers and developers were overburdened by the need to produce great shoes for both enthusiasts and for, well, septuagenarian mall-walkers in Miami. That bifurcation of work made it impossible to handle all their responsibilities. It also confused them as to what our business strategy actually was. As a result, we missed deadlines, made product development errors, and didn’t deliver to either market terribly well.

It’s not exactly a Copernican insight to say that your strategy should match (sorry, I should use the all-important buzzword, “align” with) your daily work. If it doesn’t, you run a serious risk of overwhelming yourself and your people with pointless activity that leads nowhere—except to feelings of overwhelm, missed deadlines, and unmet commitments.

As I’ve written about before, what often manifests itself as a time management “problem” is actually a mismatch between your strategic direction and what you’re asking people to work on. Because people are being pulled in two or three different directions, they can’t get any of their important (i.e., strategically aligned) work done. They’re busy serving pretzels when they should be piloting the plane.

Asics wasn’t the only company in this boat, of course. According to data in The Strategy Focused Organization, 80% of businesses fail to accomplish their strategies because of poor execution. 65% percent don’t align budget with strategy. Less than 35% of mid-manager activity contributes directly to the execution of business strategy, and less than 10% of front-line employees can articulate the institution’s strategic imperatives.

The numbers may not have been exactly right, but that sure describes Asics when I was there: a whole bunch of activity not tied to the company’s strategy.

Next time you see overwhelmed staff and unconsummated strategy, consider those “problems” as symptoms. The real problem—the root cause—may very well be strategy that’s neither clearly defined nor clearly articulated.

At Asics, we made the tough decision to adjust our product line to match our espoused strategy. We dropped the bottom end of our product line—saying goodbye to a sizable chunk of revenue and earning the rather considerable wrath of our sales reps. It sure hurt for awhile. But it freed up our designers and developers to do the right work, and in the long run it positioned us to build a truly sustainable business that leveraged our core strengths. Three years later we had regained all the lost sales and built a rock-solid position at the high-end of the market.

Who are your septuagenarian mall-walker customers? Bringing clarity at the top level leads to focused action at the front line. And that’s your job.

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