Have a clear road map, but stay flexible
Creating a defined vision and plan with a clear strategy and strong value proposition is essential for highly effective businesses. That’s why the strongest performing companies tend to have a clear, up-to-date road map.
Recent research highlights how important the connections between direction, strategy, goals and purpose are to an organisation’s sustained performance.
But while a road map is certainly a useful tool, there is also a clear need to be flexible with it.
The Harvard Business Review (HBR) echoes this sentiment, recommending business leaders “assume the plan is a work in progress.” Strategy is not a set-and-forget instrument, rather “a living and breathing document that guides decision-making and helps marshal resources.”
Agility is key in a fast-changing world. By considering multiple scenarios in advance, companies can identify potential consequences and volatility within their organisation.
Running various ‘what if’ scenarios may seem time consuming but it means that businesses can adapt much faster and make the right decisions when uncertainties arise, having already anticipated the consequences of such decisions. With the advent of cloud-based reporting, organisations can also react much quicker to warning signs in their underlying performance.
Scenario planning uncovers a range of routes your businesses could take, and can help you prepare for any eventuality.
The key point - wholeheartedly supported by BDO - is that while there needs to be a structured plan in place for where the business is going, owners are encouraged to change and adapt. The road map is a guide, not a cast-iron arrangement. Its’ purpose is not to reflect reality at some point in the future, but to get the business closer to that reality.
Regular, robust strategic reviews will lead to better planning and greater agility.
Creating a road map is a continuous process that leaders need to embrace to be accountable (and ensure others are accountable).
Sometimes the questions being asked in the strategy review process are not incisive enough to challenge the assumptions behind the plan, and to ensure the plan is flexible enough to deal with changes in the business environment.
To help you consider this, we’ve put together a list of strategy review questions, as well as a list of more incisive questions to challenge the assumptions behind your business plan.
Strategy review questions
Vision, purpose and advantage
- What will your business look like in three years’ time?
- What is the purpose of your business?
- What are the competitive advantages of your business?
- What are your financial objectives over the next three years?
- What are your top three growth opportunities?
- What are the top three actions central to achieving these goals?
- What markets will you operate in?
- What is your customer value proposition for each market?
Operations and resources
- What operational systems and processes must you excel at to deliver value to customers?
- What people and resources do you need to execute your strategic plan?
- What are your key milestones for growth?
- Who will be responsible for driving business growth and achieving milestone events?
Second stage, robust review questions
- What are competitors doing to increase market share?
- What do you know about your competition, their leadership and key people?
- Could a competitor conduct merger or acquisition activity, or form alliances to enter your segment?
- Do you have the right people in the right roles, and do they know what they are accountable for?
- Can your sales force win in existing and new market segments?
- How will technology help you execute strategy?
- Are you focused on your key market segments?
- Can your people explain your business’ strategy in a few simple phrases?
- Does your plan have a few (around three or four) strategic priorities?
People and operations
- Have you broken down the strategic plan into one-year operation plans and quarterly initiatives?
- Does each business unit or function have the right kind of people and resources to implement these plans and initiatives?
- Does everyone know what they are accountable for?