The medical definition of strategy is, roughly, change that contributes to successful evolution. Think about this in terms of your business. Isn’t that the end goal – successful evolution? What’s notable here is that nature evolves through a series of trials and errors, and the organisms that adapt in more successful ways are the ones that survive. In business you can ill-afford the luxury of trial and error, so establish desired progress by making goals and objectives. But strategic planning can’t stop here. The way to insure your company doesn’t end up a dead branch on the evolutionary tree is by coupling goals with the ability to deliver.
This is done through organizational alignment. By establishing what value your business has to offer (strategy), defining what you need to deliver on that promise (resources and capabilities), and making decisions directed towards those efforts, you have aligned your company. Goals and objectives are markers in measuring success, not the end of strategy itself.
How then, can you harness your capabilities and resources to align with strategic plans?
- Identify strategic capabilities. Capabilities are made up of processes and systems that enable a desired outcome. The right mix of aligned organization choices can lead to differentiation.
- Turn strategic capabilities into differentiating capabilities. Your company may have the capability to execute a strategy, but are those capabilities unique in the marketplace? This is paramount – to offer capabilities that set you apart from the competition. This requires leaders with clear vision of what market niche the company is creating or filling and diligence in identifying, building and exploiting new capabilities.
- Shift your resources. New or different demands on processes, systems, practices, and people will strain the current structure because strategy is about the future and capabilities are aligned to the past. Be willing and committed to shifting resources to align with your strategic plans. Revenue may be diverted from one area of the business to another. Cost cutting measures may need to be implemented, but only in surgical ways that don’t undermine the strategic, differentiating capabilities needed to win. Focus capital investments in areas that will lead to the biggest strategic impact.
- Examine work relative to strategy. As resources shift, analyze the work within your organization and reorganize it as appropriate to ensure work and people are structured to deliver strategic value. Restructuring is not the first step in organization alignment, but is often necessary to achieve your strategic plans. Retain and resource work that is most closely connected to the strategy – your “secret sauce.” Work that is farther away from the strategy may be streamlined or possibly outsourced.
Any organization is perfectly designed to get the results it is currently getting. It follows naturally then, that if a company’s results are to change, differentiating capabilities must be developed and resources allocated to support strategic alignment. The goals and objectives that inevitably emerge from strategic planning efforts are great ways to focus implementation efforts and measure success along the way.
There is an inseparable connection between strategy and capabilities. If resources and capabilities are not behind your strategy, your strategic planning efforts are more wishes than tangible, attainable plans.