As you need a good chef to make delicious food, you need a good strategist to make a winning strategy.
Most of us know the importance of good strategy. A good strategy is like a beacon shining brightly for a firm sailing in dark times amid dark, foggy, and treacherous seas of competition. A good strategy guides CEOs, managers, and employees toward victory even when the odds are unfavorable. A good strategy determines the very survival of Firms in the long run (read more about the Holy Trinity of Business here).
Unfortunately, most firms these days don't have a good strategy. Many think a strategy is a nicely formatted document containing big "strategic" words and jargon. Others confused flashy vision and mission statements as a good strategy. Many others mistakenly take a long-term sales projection for a strategy. (read more about the Seven Types of Losing Strategies here).
How do you know if your strategy is good, not bad? Knowing the principles of winning would help, for example:
If your strategy doesn't exactly tell how your firm can overcome competition, surpass obstacles, and achieve your goal, then you don't really have a (good) strategy.
If your strategy doesn't dictate the choices made by your firm's executives, managers, and employees, then you don't really have a (good) strategy.
If your strategy isn't reflected in your firm's culture, policies, processes, procedures, and systems, then you don't really have a (good) strategy.
Bad strategies are apparently common. In my book, the G. O. S. P. E. L. of Strategy, I laid out the finding that 98% of strategies are bad, losing strategies. Only 2% of strategies are good. , winning ones.
But why do firms have bad strategies? Let me use the analogy of cooking to illustrate the answer.
All of us like delicious food. Just as all of us like a good, winning strategy.
And just like not everyone can cook delicious food, not everyone can cook a winning strategy.
But firms often ask the non-experts in strategy to develop a strategy by giving them a strategy framework.
If cooking a winning strategy is like cooking a delicious dish, then you cannot create a winning strategy by simply filling in a strategy framework (e.g., SWOT, Porter's 5 Forces, Value Curve). Give a novice the best, most premium saucepan and pot in the world and ask him/her to make delicious pasta. Even with the best stove in the whole world, the result wouldn't be good.
Why? Because to make a delicious dish, you need more than just the tools.
For a chef to cook a delicious dish, he/she will need seven things.
Cooking theories, i.e., the knowledge of what makes a dish taste good, e.g., X and Y do not go together.
Cooking techniques, i.e., the practical way of cutting, mixing, trying, etc. While it looks small and insignificant, it actually makes a big difference in the finesse of the dish.
Cooking recipes, i.e., the ideal step-by-step procedure of preparing the dish. First, do X, then do Y, before Z.
Cooking tools, i.e., specialized tools and equipment such as knives, trays, ovens, etc.
Cooking ingredients, i.e., all the elements required to make a dish. Good quality ingredients can enhance the quality of the dish.
Professional conduct, e.g., not using rotten food, ensuring clean utensils, and paying attention to allergens.
Capable assistant(s), i.e., reliable and capable team members who support the chef in preparing and serving the dishes.
Similarly, for a strategist to cook a winning strategy, he/she will need seven things.
Strategy theories, i.e., deep knowledge of what will and will not work in the strategy. For example, economies of scale are good, but vague positioning is bad.
Strategy techniques, i.e., the practical know-how to develop and implement a winning strategy. For example, the skill to deliver engaging workshops, the ability to create a compelling story, and the capacity to digest a large amount of information and data.
Strategy process, i.e., the step-by-step actions needed to create a winning strategy. For example, the analysis should be done at the beginning, not at the end. Communication is to be managed from the beginning.
Strategy tools, e.g., specialized frameworks, software, and instruments that help solve various problems. For example, a strategist may use R programming language to analyze large amounts of data or Prezi to create a non-linear, conversational presentation.
Strategy ingredients, i.e., the firm's given internal and external factors. For example, developing a winning strategy will be much easier if the firm already has a winning product. Conversely, it will be more challenging if the external environments are hostile.
Professional conduct, i.e., a set of norms that a professional strategist voluntarily follows, such as no fake data, misleading advice, confusing jargon, harmful impact on society, leaking of confidential data, and sub-par work.
Capable assistant(s), i.e., reliable and capable team members who support the strategist in developing and implementing strategy.
As you can see, the difference between the experts and the non-experts is often not in the tools. Anyone can buy an expensive set of high-grade Japanese steel knives. Anyone can try to make a delicious dish by following an online recipe. But to cook well requires sharply-honed techniques and a solid understanding of the basic principles. This is the same as in strategy: anyone can use the frameworks and follow templates, but applying them well requires sharply-honed techniques and a solid understanding of the basic principles of winning strategy.
Furthermore, you cannot replace experts with a lot of novices. Quantity is not a replacement for quality. In cooking, too many cooks spoil the dish. It is the same in strategy: you need only one master-strategist to lead the strategy exercise.
Given the importance of strategy, make sure a top-notch strategy chef develops your firm's strategy. Don't leave the long-term fate of your company in the hand of bad chefs.
Continue exploring winning strategy here.
Quote of the day:
I am not supposed to be an expert in every field. I am supposed to be an expert in picking experts.
-Moshe Dayan, a famous military leader
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