Here’s my Top 10 list of deficiencies in the strategy process.
In far too many strategic processes, a conservative approach is taken toward strategy development.
This conservatism is about sticking to what you already are and continuing to do what has brought the company its current business success.
This approach might work in the short term, but not over time in changing markets.
Conservatism is a short-sighted, fear-driven, and naïve approach to strategy.
Business leaders with experience and skills for ensuring efficient operations, managing the board and the media, and motivating all their managers and employees may not necessarily be adept at developing innovative strategies that can accelerate a company’s growth.
Here’s my Top 10 list of the deficiencies I frequently encounter in companies’ ineffective strategy processes:
1. Lack of courage and willingness to understand the company’s real starting point
We’d rather focus only on our current business results (regardless of the level) to maintain the perception of ourselves as successful business people on the path to a profitable future.
2. Lack of insight into customers' current and future needs in the strategy process
We prefer to avoid new knowledge that might force us into changes we can’t fully anticipate, which could affect the bottom line in the coming fiscal year.
3. Lack of respect and understanding for current and future competitors
We need market stability so that we’re not forced to make changes that could impact profitability. Therefore, we only look for signs that the future will be like the present rather than the opposite.
4. Lack of a long-term perspective that enables investment in new profitable business models to future-proof the company
We prefer to maximize our short-term returns because it makes us look most successful in the here and now. This makes it difficult to invest in developing future relevance and competitiveness.
5. Lack of ability and willingness to reinterpret business potential
We are far too focused on optimizing the current business and don’t get around to locating or developing future products.
6. Lack of courage and understanding to use ambitious goals as a catalyst for equally large and crucial efforts
We prefer goals we feel confident we can achieve. This avoids issues with the board and negative media coverage.
7. Lack of brand differentiation
We’re so afraid of failing to stand out that we miss creating the brand differentiation that could serve as a strong foundation for accelerating the company’s growth.
8. Lack of cohesive efforts and sufficient investment in business transformation
We consistently underestimate the resources needed to drive development to secure new and better results.
9. Lack of clear purpose and social responsibility
We prefer to talk about taking responsibility in society rather than actually doing something about it. Mostly because we see it as a short-term cost without fully understanding how taking more responsibility could strengthen our future competitiveness.
10. Lack of focus
We prefer to fish across the whole river and keep as many alternatives available as possible rather than going all-in on what we could excel at.
