Tuesday 29 April 2014
Tuesday 22 April 2014
Why a strategy fails to remain a strategy?
In one
of my earlier blogs I wrote about how strategy is different than a problem.
Let me
try giving some more insights about strategy and ‘misuse’ of the word strategy
in the corporate.
If I say
that the strategy is futuristic in nature which defines decision of making
thoughtful choices. These choices explain assumptions about choices and reasons
of choosing to do something and why not to do something.
But
the reality is different.
Very
seldom, you will find the word strategy being used alone. Generally, it is
sufficed with ‘planning’ or ‘plans’. Therefore, the strategy becomes strategic
planning or strategic plans. This change leads to very catastrophic change not
to the word itself but even to the thought process in the organisation.
Plans
or planning denotes actionable events which are scheduled in advance to carry
out in an agreed manner later. It means aligning some doable actions.
More
so in organisations, strategic planning starts with referring to the vision or
mission – a lofty, aspirational goal- as some say. The vision or mission is
then taken to identify some related initiatives. Each ‘identified’ initiative is
put under the scanner of ‘Financial Feasibility which in turn leads to ’annual
budgets’. The moment this is done, strategy is relegated into the background.
Chaos erupts out. Initiatives fail and whole word demean the ‘strategy’.
Annual
budgets are not used to define a strategy rather a tool check the financial
stability. Secondly, initiatives or for that matter financial numbers provide knowledge
about short & medium term success.
A strategy
is not a financial budget. So is the case with the planning, as planning is not
explicit about what the organisation chooses to do and why. Planning in reality talks about logic of
affordability and therefore, it can be supervised. As we were supervisors
during our course of career, we tend to go back to supervision and fail to
understand the real meaning of strategy. Regarding ‘plans’, it again revolves
around allotment of organisation resources.
So,
when you come across strategic planning or strategic plans, beware, they are
not talking about ‘Strategy’ per se. Check with people what they mean before
you react.
Tuesday 15 April 2014
A strategy is different than a Problem: Change your ways to tackle them separately.
Strategy
– the most abused word in corporate corridors, is perhaps least understood. Different people use it for different reasons, giving different
reasoning. However, the most common misuse by top executives of organisations is
when they change a challenge into a problem and then try tackling such a
problem by tried and tested tools. These tried and tested tools are put on
piece or pieces of papers after long discussions – sometimes running from weeks
to months, under the pretext of Strategy Making. Sometimes, another name of ‘Comprehensive
Plans’ is used instead of strategy. Agenda remains only one, tackling s problem
– far away from their real intention of making a strategy.
Idea
behind such activities in organisations is to feel safe & secured in the
dynamic market conditions. The feel predominantly is that as they have well
placed strategy in place, hence their business is secured. The reason of such
acts of learned well educated executives around the world is overcome the fear
of failure and discomfort.
Do you
such things in your organisations, readers?
But
fact remains a fact. Fear and discomfort are real and integral part of strategy
making. The litmus test of a ‘would be successful strategy’ is shades of discomfort
and fear about its success. The reason behind it, nobody can see & predict
future, therefore no one can make a full proof strategy.
A
strategy in real sense is about placing bets and making hard choices. Hard
choices? That people dread the most. For
all reasons, I can say a strategy should have inbuilt ‘risk of failure’ in it.
In other words, strategy can not eliminate ‘risk of failure’ but only increase
the ‘probability of successes.’
As
organisations go along, a defined strategy should provide the flexibility to
change it. No strategy can avoid
unexpected hurdles in its way. Further, ‘Perfection’ attitude in strategy
formulation has no place.
So strategy
formulators please do not get disheartened when your strategies come face hurdles
on their way of implementation, just ensure you have given enough room for
taking correct actions.
Wednesday 9 April 2014
Cost or Quality will not make your Organisation successful?
You may find organisations struggling to make profit, despite their been having best quality producst in a different category.
Reasons - failure on their part to respond to customer need and ever changing world, complacency
to shrug off need to change themselves and the worst, looking for reasons to justify not to
change. One of causal relationship in these companies is their ‘inward’ looking
approach.
Cost
and quality are hygienic factors in business today. No company can survive if it
does flirt with quality or cost. At the same time none of these two provide, any base for
differentiation and therefore no reason to charge premium. Companies which do not
have ‘anything’ in their product or services to charge premium can only make ‘Survival Profit’ for short run. Lucky
companies can slower down their speed to death as they luckily got a distinct product
category. But question comes how long?
New
world has given a more serious threat as they lowered down their cost of production
by exploiting Economies of Scale but at the same time maintained high degree of
quality standards.
Man
does not stop at challenges. Rather, challenges help him in being more creative
Organisations
have to build a ‘Culture of Receptivity to
new Ideas’ i.e. Culture of Creativity thereby any and every idea being tossed
to it formally and informally is put to test before being rejected having no
substance. Mind it, ‘ideas are not
incubated in labs but in a positive atmosphere of Receptivity to new Ideas'. All studies
show, organisations fail when they start avoiding new thinking on one or other
pretext.
Organisations
therefore, have to look for ‘External Exposure’ to create differentiation in
their products or services to look for premium. We all know, source of
profit is value being derived from a product or service by the customer or consumer.
It thus, means any activity which can define further the value enhancement in
the entire value chain can help organisations in achieving differentiation in
their products or services.
Differentiation leads to Premium. Organisations have to look at both
ends of its spectrum to enhance the value of its products or services. At one
end, they should look for integrating very closely with their supply chain
partners, improving their manufacturing processes and at the other end they
should optimize customer value across the whole chain, not just their part of
it and should also harness technical capabilities of their supply chain
partners.
At
the end, organisations should create an ecosystem of its own to build either product
or service superiority. Mere focus on cost will not guarantee profitability in
changing world and down play with quality will wipe the organisation overnight.
Tuesday 1 April 2014
Leadership in VUCA World
"Leaders
need to 'see around corners' - to see something significant about the future
that others don't see.'
An apt saying for the current VUCA world,
where everything & anything is volatile, uncertain, complex in nature and
ambiguous by its presence or absence.
Leaders make plan well in advance and try achieving
them by organising resources around those plans. But the reality hits them hard
on their faces when these plans are either under achieved or not at all
achieved. This can very well be seen in slipping down financial numbers in
majority of cases.
Learning by most of executives to my mind
is cribbing about the conditions & cursing it, instead of taking
appropriate actions. At the same time there are leaders and organisations which
undertake diagnostics and change themselves to 180 degree. It therefore means
what all needs to be taken into account in this VUCA environment and come out
successfully are.
a.
Actions & Comprehension
Clarity in the minds of leaders is the foremost point to succeed. No
effective actions can be taken if the clarity is not there about what all needs
to be accomplished. Once, the clarity is established, it becomes very easy to channelize
resources and people around it.
More VUCA environment, the harder it is for leaders to comprehend
the situation. Resulting in the difficulty to comprehend and articulate it.
This leads to inaction by leaders or simply following the down trodden path of
reaction.
Therefore, it is of utmost importance to articulate well what all
to be accomplished and actions should not stop.
b.
Higher in position, tougher to articulate
an objective
It is seen that inaction starts at the top. Any immobilisation at
the top has multiplication effect at the bottom. Leaders are being watched by
their followers. They watch you for your every action & inaction and
accordingly make up their minds to take actions or not.
Leaders need to force themselves to get clarity in their own minds
and let their subordinates know how they see things. Articulation and corresponding
actions will become easy for both leaders and their subordinates respectively.
c.
Look for Actions and not for Right actions
I believe ‘one cannot see future with clarity and therefore it is almost
impossible whatever one does will test the testimony of time and will come out
right.’
Instead of fighting for the right actions, it is imperative to
take actions. Correct the actions on way, if required.
d.
Establishing a Common Purpose
Objective in hand will give leaders required insight on continuum.
Objective also will give a common purpose for the people to align their
actions.
Leaders could not see that their incapability to bring people
around one common purpose will eventually be fatal for the organisation. Only
thing they may see or in most cases may not, the date of fatality.
e.
Lead by Values
When everything around is so ambiguous that a decision cannot be
taken, leaders should lead themselves by following their values.
Value your values. I believe in ‘When going gets tougher, hold
tight to your values’. Any slippage on your values will put you on a wrong
path. Leaders need to make their organisations ‘to be values led’. Mind it everybody
is watching you.
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