External market forces such as Environmental, Social and Governance (ESG), regulatory changes, changing consumer trends, macro-economic shifts and emerging technologies are creating uncertainty and pressuring organisations to constantly adapt and reinvent in order to remain relevant.
Even long-standing and multigenerational companies - which once seemed invincible – are being disrupted by the pace of change. It stands to reason that applying a rigid and process-oriented approach to strategy in a dynamic, rapidly evolving environment no longer works.
Organisations must adopt an approach that can meet these challenges head-on - one which is adaptable and allows for complexity and constant refinement. The era of holding an annual strategy day is gone. Studies have shown that up to 90 per cent of businesses fail to implement their strategy and only five per cent of employees understand their organisation's strategy. In other words, strategy documents often sit gathering dust in a bottom drawer.
In this article we explore how a practical, dynamic strategy development and implementation framework can keep pace with change, addressing many of the issues with implementation that organisations are facing and making them more adaptable and resilient in the process.
How a different strategic approach creates better outcomes
Understand your challenges and purpose
Why does your organisation exist? Does your strategy align to that purpose? What are the challenges you’re facing in implementing that strategy? A well-defined, effective strategy framework clearly assesses the current state of the organisation’s capabilities, systems, competitors, key partners and relationships, customer segments and channels so that key decision makers can understand the current strategic challenges and whether they are fulfilling the organisation’s purpose and strategic objectives.
Create a shared vision for the organisation
By formally involving key stakeholders outside of the executive group in the strategy cycle - such as board members, managers, key partners and employees – an organisation can create a shared vision of where it is headed and how it plans to get there. This alignment helps ensure that everyone is working towards the same outcomes, which can lead to better decision-making, more effective resource allocation, and increased employee engagement. In turn, this creates focus to identify key strategic initiatives and validate whether time and capital are invested in the most important areas.
Clarify priorities and roles
Many organisations spend time and resources on complicated business plans that aren’t pragmatic for day-to-day decision making. By having an approach that clearly defines priorities, aspirations and values, organisations can create a roadmap for success and provide clear direction for staff at all levels. This clarity helps leadership, management and employees understand how each organisational layer and team adds value and how their work contributes to the organisation's overall success. This can help them feel more connected and engaged - reducing resistance to change.
Accountability encourages action
By clearly defining priorities, roles, responsibilities and metrics for success, organisations can hold themselves and their employees accountable for achieving their strategic initiatives. This sense of ownership and responsibility not only helps drive performance, but helps to ensure that your strategy document isn’t consigned to the bottom drawer to gather dust. Building a culture of accountability in the organisation has benefits which reach far beyond strategy implementation.
Making the organisation adaptable to change
Rather than being caught off-guard, incorporating regular reviews and an agile governance structure helps organisations quickly adapt to shifts in market conditions and customer needs. Static, inflexible, ‘set and forget’ strategic plans which are only revisited once a year don’t allow for this level of adaptability, nor do they encourage a culture which is responsive to changing trends and emerging opportunities. This adaptability can help organisations stay relevant and ultimately, remain competitive in their industry – particularly during periods of rapid change.
Building your strategy – why get external help?
Objectivity and a fresh perspective
External advisers bring an objective and fresh perspective to strategy development and mitigate the risk of ‘group think’ or conflict. Having more distance from the business than internal stakeholders means they can provide an unbiased assessment of the business's strengths, weaknesses, opportunities and threats.
Access to experience and expertise
Experience and expertise in developing and implementing strategies across various industries and business models can be invaluable in identifying potential challenges, developing effective strategies and ensuring those strategies are successfully executed.
Save time and resources
Developing and implementing a strategy can be time-consuming, particularly for organisations with limited internal strategic experience or resources. Specialist advisers bring a structured and efficient approach, complete with specialised tools and resources – which may be too expensive or impractical for businesses to develop in-house.
Accountability and support
An external resource to provide support for the leadership team and accountability throughout the strategy development and implementation cycle can be invaluable. This can help organisations to establish and track KPIs, identify and resolve issues, and ensure that strategy execution stays on track – and is ultimately successful.
How BDO can help
Our approach builds on contemporary research from leading global strategists. We work with you to tailor the approach to the specific needs of your organisation, which is achieved through stakeholder consultations, workshop facilitation and post workshop consultations for execution.
The resulting approach encompasses a visual roadmap and high-level strategy on a page, supported by qualitative data from the facilitated workshops and incorporates a risk management component to test and validate what would have to be true for the strategy to be realised. This includes identifying potential roadblocks and developing contingency plans to ensure that the strategy remains on track and that key decisions are based on relevant qualitative and quantitative data.
Importantly, our approach works with the knowledge and experience of your people – not just analysing abstract spreadsheets in the background.
Thanks to Tom Key, Director Strategy & Transformation and Matt Cannone, Assistant Manager Strategy & Transformation, for their contributions to this article.