What is a strategy and why is it important?

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What is a strategy and why is it important?

May 2014 | Servcorp

“What you need is a strategy.”

It's a catch-cry many business owners have heard and undoubtedly spent numerous hours pondering. What exactly is a strategy? And how do you develop a good one? The Oxford Dictionary states a strategy as “A plan of action designed to achieve a long-term or overall aim”.

So while the term ‘strategy' might strike fear into the minds of business owners and managers, most people have developed many – both in their personal and business lives. Saving for a house, training for a sporting event, designing and planting a garden, learning a new skill, choosing what to outsource and what's required, are all part of a strategy – a plan of how to get from point A to point B.

For those who enjoy business jargon, the ‘strategy' is the overarching bridge between where you are now and where you want to be in the future. The ‘strategic plan' is the finer detail of how exactly you're going to build that bridge. Taking the bridge analogy further, there are many different bridges, arch, suspension, cantilever, girder, just to name a few. So too there are many strategies that you could develop for your business. The challenge is to decide which one will maximum the benefits and minimise the drawbacks as it leads you to your destination.

The first challenge is to create an inspiring goal – or vision – one that is challenging, yet motivating and achievable. This has to come first. IBM's founders had a clear idea of how their ‘finished' business would be structured, and they used this blueprint to develop the business. But many business owners and managers find it hard to imagine what their business might look like in the future.

The most beautiful thing about visions and strategies and planning is that you don't have to imagine taking over the world and you don't have to write hundreds of pages of ‘strategy'. If you're finding it tough to make a ten-year or a five-year plan, scale it back. Start with one year or even six months.  Quite simply, just start imagining.

Consider involving your staff in brainstorming where the business could go. No doubt you'll come up with many destinations. In fact, you might be surprised at how much thought your staff have about the business and how excited they are to have the opportunity to contribute to developing it.

Starting with the end result in mind is vital because it not only motivates, it creates focus. Link staff performance appraisals to smaller goals – or milestones – on the road to your ultimate destination. This forces everyone to prioritise.

Anything that's minor falls away. You'll carefully consider how each and every decision will influence achieving the vision. Suddenly there isn't enough time to do anything other than those things that draw you closer to your goal.

And guess what? What's left when all the non-priorities fall away is the core of your strategy and your strategic plan. Forget definitions and business jargon. Focus on the vision for the business. Decide the best approach to get you from where you are now to where you want to be. Let all else fall away and you've got your blueprint for the future . . . or if you prefer, a good strategy and a great strategic plan.