How to make your business strategy a success

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I recently attended a professional programme on Strategic Business Management at Harvard, and I want to share my experience with my fellow readers. In brief, my experience at Harvard has been superb: tuition, location and fellow students were magnificent and greatly contributed to make this overseas trip a unique experience.

As you may know, Harvard is the leading academic institution which has been shaping the domain of business strategy and management over the past 40 years.
The most successful companies in the western world have applied the teachings of Micheal Porter, university professor at Harvard Business School, which in the early 80’s coined competitive advantage and the value-chain model.
His works about competitive advantage, strategy and value-driven models received global acknowledgement and academic recognition in such a way that basically every university-grade management programme over the globe mentions his studies.
As one can imagine, the programme about Strategic Business Management I attended at Harvard was largely based on his works.
Out of an intensive 2 days programme, I have made a personal list of the top teachings I learned and that I feel that any company should keep in mind to make its business strategy work as expected.

1 – Old principles are still valid
Considering that the Porter’s studies were formulated in the 80s, many could argue that these principles are outdated. But as you’d discover the ideas about value-driven businesses and competitive advantage are evergreen.
Take as an example the many start-ups referring to the “Business model canvas” (and “Value proposition design”) formulated in 2008 by Alex Osterwalder to explain their business strategy.
At a closer look one can recognize that Osterwalder’s tools are largely inspired by Porter’s work and develop from the very same old principles.
In Porter’s vision, competitive advantage cannot be sustained without a unique set of internal, value-adding activities. Similarly, Osterwalder’s Business Canvas Model emphasises the value adding activities perceived by the customer as “your unique value proposition” (in the center column of the canvas).

2 – Every organisation needs a strategy
Just like every human being should seek a “purpose” in life, every company shall understand its purpose and how to achieve it. Without a clear-defined strategy, organisations are left into an “idle-mode”, a “still life” that simply aims at surviving to the rollercoaster of market trends.
Unfortunately, “idleness” in business will often translate into incorrect direction and wrong business decisions being taken by the company. And our history is full of examples where difficulties in shaping (and executing) strategies have led companies from huge profitability to legendary business disasters (e.g. Kodak, Nokia).
To my opinion, this is much more applicable nowadays where competition is fierce in global markets, in private and public sectors, thus having a strategy and the resolution to execute it are mandatory commandments for modern managers.

3 – Strategy does not mean complicated
A majority of the executives I spoke with feels that formulating a business strategy is complicated, requires thorough experience and will ultimately find resistance to get it approved and executed.
Indeed most businesses are currently in very dynamic markets and formulating a strategy that can last the various ups and downs of the industries can appear a complicated and exoteric topic.
But it doesn’t have to be that way.
For a good strategy to work, it must be simple and easy to understand.
Not necessarily easily achievable, but easy to explain and communicate to the rest of the world.
If you are in struggling in finding a “sweet spot” between you and your customers, a good start is to review Micheal Porter’s main 2 strategies: cost leadership and differentiation. In cost leadership your goal is to attain the cheapest cost in the industry to build your product or service, while differentiation aims at proposing a unique service or product not found in your current market (finding your niche). Porter’s strategies are not overly complicated, nor require more than one sentence to be explained.
Nevertheless, an important aspect of your strategy is to be unique, not to lead your organisation to become a fac-simile company. In facts, it is the unique blend of internal, value-adding activities that makes your business profitable above your competitors.
As a friend of mine likes to say “you can make big money by selling the same stuff but in a smarter way”. It is your mission to find out how.

4 – Communication is key
Once a strategy is well-defined, communicating it along the business lines of your organization is very important to share the objectives it is supposed to achieve.
Defining a strategy is only the first step of a larger challenge, where prevalent efforts should be spent in communicating and disseminating its precise objectives.
Organisations shall explain the new business direction as soon as it gets out of the board room, possibly with an open presentation, with the entire company.
Failure to do so can generate confusion and can ultimately be frustrating for the workforce.
Imagine a company targeting a “cost-saving” strategy which has put small efforts in explaining to the employees how this is going to be achieved. In such circumstances, a sales manager may not feel any more at ease to offer premium discounts to his most loyal customers because he may not be aware how this decisions will impact company’s profits. It is very much likely that
Hence the key is to have a successful “propaganda” of your strategy.
I like to share some teaching from another reputable source, Harley Lovegrove’s Change Manager’s Handbook: we shall always seek the answers on “why we are doing this?” and “what is the problem we’re trying to solve?”.
Once you know the answers, use them to popularise your message and make your strategy a success.
For this reason, having a good communication plan will definitely help your company in spreading the correct message all along the various business lines of your company.
As an example, use well designed “motivational posters” with your strategy message, or engage your audience in plenary sessions to explain the “Why” and “What is the problem you want to solve”.

5 – Strong leadership is required
So far, we learned that well-thought strategies can be effective only through strong communication. But communication is challenging and a daunting task even for the most experienced manager which often needs to face resistance from the workforce and must deal with dispersed teams with different cultures and regulations.
To overcome any risk of derailment of your strategy, executives must ensure that the organisation is ready to embrace the change required to achieve your goals. They must play the role of “ambassadors” of your strategic plan to educate the workforce about your planned objectives.
First, a best-practice is to select the “influencers” or strong leaders – not necessarily managers – which have a consistent number of “followers” in the workplace so that they can easily share their vision with their peers.
Secondly, you shall not underestimate your opponents and you must keep close your detractors: avoid that “misbelievers” spread nuisance in the company and pull the workforce apart endangering your strategic plan.

An example I like to recall is how Fujifilm survived to the digital photography phenomenon that killed his main competitor Kodak. Mr. Komori – FujiFilm CEO at the time – led a strategic revolution in 2003 to redirect the company’s business to diversify into pharmaceutical, healthcare and cosmetics.
The reorganisation caused strong resistance but this couldn’t have happened without a strong leadership and an effective communication strategy.

The world has offered many examples of organisations that have successfully designed and implemented business strategies and the five topics examined above can be found in a lot of them.
Make sure you use these to make your strategy a success.

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