Strategy is one of the five key success factors of business that can ensure your success and stand the test of time. Key success factors are not fads or solutions of the month, but enduring qualities you can bet your business on.
Over 25 years, reviewing and analyzing over 100 top-selling books, as well as many professional articles and practical experience with many different clients, we determined that there are 5 really big Key Success Factors, each one with 8 to 12 subcomponents. Over a 5-part series, starting with this one first on strategy, we explain what those 5 Key Success Factors are, and how you can use them in your business right away.
If you really want to learn about all 5 key success factors, get our new book, The 5 Key Success Factors of Business: A Powerful System for Total Business Success, available on amazon in all formats at this link.
First, here are the 5 Key Success Factors:
- Strategy (Strategic Focus, Leadership, Management, Planning)
- People (Personnel, Staff, Learning, Development)
- Operations (Processes, Work)
- Marketing (Customer Relations, Sales, Responsiveness)
- Finances (Assets, Facilities, Equipment)
In this post, we’ll identify the 10 elements of Strategy:
- Our firm is customer-driven based on current surveys of customer value. It doesn’t do much good to focus on what you as the leader, manager or owner want. What matters most is to focus on what the customer values most for effective strategy. And you can’t get that by guessing or even by asking customers. The best results by far are achieved with an objective survey administered by an experienced market research firm.
- Our own core values are shared and taken seriously. Core values are powerful statements of what you and your team passionately believe is most important in your business. These can’t be glib, generic statements like “quality, price and service.” They need to be the authentic words of the leadership as well as the people of the organization. Here for instance is a core value from a company we have worked with: “Our processes must operate in a way that meets or exceeds current best practices of health and safety in our industry.” If you are not comfortable crafting your own core values internally, hire an expert to help you through this important strategy process.
- Leaders “walk the talk” and demonstrate their commitments to our values. It’s not enough to paste your core values on the wall or hand them out on the back of business cards. Your people will know you really believe in those values when they see you talking about them naturally as you “manage by walking around” and work with others to solve problems. Use the values every day to demonstrate your commitment to core strategy and strengthen their benefits for your organization.
- We are focused on what we do best, a sustainable competitive advantage. The most effective strategy in business as in athletics and war is to concentrate your resources on your greatest opportunities. And your greatest opportunities are to build on your strengths which competitors cannot match while focusing on target markets you can dominate. As one expert has said, “Define a niche small enough that you can dominate it.” Maybe you can’t be the best bakery in your city, but you can be the best bakery in your neighborhood. And this advantage must be sustainable in that it is rooted in who you are and what you do best, not some technology you bought off the shelf yesterday. As you can see this is closely connected to your core values and what your customers want the most from you.
- Our purpose is expressed with an inspiring, tangible vision and mission. A vision statement is a picture of what you want your organization to be in the future, say 5 or 10 years out. A mission statement is what you must do to achieve that vision. State the vision in the present tense to make it tangible and believable. For example: “We are the leading health care architect in the Southeast.” Your mission then becomes monitoring the rapid changes in the health care field, designing new and better solutions to meet those needs, and promoting them throughout the Southeast through smart marketing, giving talks at professional meetings, producing white papers and more.
- The mission is supported with stretch goals that are achievable. If your company is generating $500,000 a year in sales, it is not much of a stretch to aim for a 10% increase in the following year. A stretch goal would be more like $1 million in sales. Good stretch goals stretch your organization to perform at its best but not “break” under too much stress and pressure. The best strategy goals are SMART goals – Specific, Measurable, Achievable, Realistic and Timed. But SMART goals can still be easy even if they are clearly defined. It is your job as a leader to stretch your team to its highest performance and win the equivalent of your Super Bowl.
- Each goal is backed with a clear strategy, tactics and responsibilities. A goal is only as good as a plan to achieve it. It needs to be supported with a clear, believable strategy like “We are going to hire 10 more sales people and increase our marketing budget 35%.” Then these specific strategies need to be translated into tactics – what are we going to do week by week, who is going to be responsible, how are we going to measure progress, and where is the work being done.
- Progress toward goals is measured with a system guiding daily actions. Many companies develop strategic plans or operating plans and put them on a shelf or in a file folder where they just gather dust, like pictures of your high school reunion. No real value there. Keep your goals list so simple that it and the key strategies can fit on one sheet of paper. Bring it to every staff meeting. Once again “walk the talk.” Think of the incredible volume of statistics generated in a 3-hour professional football game! A system guiding daily actions generates measurements, data, that can be used as feedback to continuously improve as well as to hit those stretch goals.
- Plans for the future are updated at least annually and communicated internally. While it is ideal to update your strategic action plans continuously as situations change, at least once a year set aside time for a major review from top to bottom – values, vision, mission, goals, strategies, tactics. Create a system that works like a well-oiled machine and can be constantly improved year after year. Once you reach your first stretch goals, set another set, so you continue to stretch further and achieve more.
- All success factors are coherently aligned in a realistic strategic management system. We have identified five powerful success factors for business and organizations. But they cannot be treated as separate departments doing their own thing. They all need to be aligned in one strategy-focused system. They need to reinforce each other. The arm needs to know what the leg is doing, and the eye needs to know what the ear is doing, to use a “body” analogy. It is the job of the strategic leaders of the organization to make sure everything is connected, works as one, works as a whole, so that the whole is greater than the sum of the parts. Results will then be truly outstanding, far greater than you ever believed possible.
Very few companies can claim all 10 of these Strategy elements, but there is always room for improvement. Learn more about the other key success factors with these links:
- People (Personnel, Staff, Learning, Development)
- Operations (Processes, Work)
- Marketing (Customer Relations, Sales, Responsiveness)
- Finances (Assets, Facilities, Equipment)
Meanwhile, be sure to get your copy of the new The 5 Key Success Factors of Business which explains the 5 key success factors in detail at this amazon.com link.
See Also
The 5 C's of Living Life