Becoming a Brilliant Strategist

To make sure you understand the difference between a tactic and a strategy, here are some simple, yet essential, definitions.

A tactic is a method or technique used to achieve an immediate or short-term gain. You run ads or send direct mail pieces to get leads. You go on a sales call to make a sale. You attend trade shows to meet with potential buyers and get more leads. These are examples of tactics.A strategy is a carefully defined and detailed plan to achieve a long term goal. In business, a strategy is the overall impact, the ultimate position you would like to achieve in the market. To think like a brilliant strategist, you will design and combine your tactics with the long-term strategy in mind. In addition, you will constantly ask yourself and your team, “How many strategic objectives can we accomplish with each tactic?” In this chapter I’ll show how every tactic can potentially achieve 10 or more strategic objectives.

There are three types of executives. A full 90 percent are “tactical executives,” while 9 percent are “strategic executives.” And only 1 percent-the most effective executives possess the rare combination of both tactical and strategic abilities.

Tactical executives think only in terms of making the sale for today. They don’t understand strategy. If you tell them that it’s twice as difficult today as it was 10 years ago to get an appointment, with a prospect, they will think of ways to make the sales team try twice as hard.Strategic executives will often look at the situation from a global perspective and see if they can develop some high-level strategy that might help to solve the problem. These executives are brilliant. They create concepts, ideas, and strategies that most would never develop.Below are the 5 points to consider as and when you wanted to take strategic move in your organization.

Strategy is not Operational effectiveness

In many of the cases we found out business owner’s are taking Operational Effectiveness as a Strategy, and I think the root of the problem is the failure to distinguish between operational effectiveness and strategy. Total Quality Management, Benchmarking, Time based competition, Outsourcing, Reengineering, Change Management all are examples of Operational Effectiveness not Strategy. However, OE will dramatically change the bottom line (profitability) of the business but it is not sufficient.  A company can outperform rivals only if it can establish a difference that it can preserve. It must deliver greater value to customers or create comparable value at a lower cost, or do both. OE means performing similar activities better than rivals perform them. In contrast, Strategic Positioning means performing different activities from rivals’ or performing similar activities in difference ways. Constant improvement in operational effectiveness is necessary to achieve superior profitability. Japanese companies rarely developed distinct strategic positions; they mainly focused on operational effectiveness.

Access-based positioning—access can be a function of customer geography or customer scale or of anything that requires a different set of activities to reach customers in the best way. A sustainable Strategic Position Requires Trade-Offs. Strategic position is not sustainable unless there are trade-offs with other positions. Trade – offs occur when activities are incompatible. Trade-offs creates the need for choice and protect against repositioners and straddlers.  It will totally affect your all efforts (advertising, sales, marketing, and distribution channels). Trade-offs arises for three reasons. Inconsistencies in image or reputation. — A company known for delivering one kind of value may lack credibility and confuse customers – or even undermine its reputation – if it delivers another kind of value or attempts to deliver two inconsistent things at the same time.Activities itself – different positions require different product configurations, different equipment, different employee behavior, different skills, and different management systems.Limits on internal coordination and control – by clearly choosing to compete in one way and not another, senior management makes organizational priorities clear.

Alignment drives both competitive advantage and sustainability.

Positioning choices determine not only which activities a company will perform and how it will perform and how it will configure individual activities but also how activities relate to one another. While operational effectiveness is about achieving excellence in individual activities, or functions, strategy is about combining activities. Alignment locks out imitators by creating a chain that is as strong as its strongest link. One activity’s cost, for example, is lowered because of the way other activities are performed. Similarly, one activity’s value to customers can be enhanced by a company’s other activities. That is the way strategic fit creates competitive advantage and superior profitability.  Alignment is important because discrete activities often affect one another. A sophisticated sales force, for example, confers a greater advantage when the company’s product embodies premium technology and its marketing approach emphasizes customer assistance and support. Strategic alignment among many activities is fundamental not only to competitive advantage but also to the sustainability of that advantage. It is harder for a rival to match an array of interlocked activities than it is merely to imitate a particular sales-force approach.

Rediscovering Strategy

Why do so many companies fail to have a strategy? Why do managers avoid making strategic choices? Or, having made them in the past, why do managers so often let strategies decay and blur?Most companies owe their initial success to a unique strategic position involving clear trade-offs. Activities once were aligned with that position. The passage of time and the pressures of growth, however, led to compromises that were, at first, almost imperceptible. Through a succession of incremental changes that each seemed sensible at the time; many established companies have compromised their way to homogeneity with their rivals. A number of approaches can help a company reconnect with strategy. The first is a careful look at what it already does. Within most well established companies is a core of uniqueness. It is identified by answering questions such as the following;Which of our product or service varieties are the most distinctive?Which of our product or service varieties are the most profitable?Which of our customers are the most satisfied?Which customers, channels, or purchase occasions are the most profitable?Which of the activities in our value chain are the most different and effective?For more inquiry please feel free to contact on sanjay@nucleusconsultant.in. To get free analysis of your business mail “Business Analysis” to the above mail id.