Business Strategy for the Win


Business Strategy for the Win
© master1305; Аня Комар; lianez

In the world of sports, a strategy is a plan outlining what you and your team will do to achieve a victory. Similarly, success in the business world also requires a strategic plan that outlines how each member of the team will contribute. In fact, having a well thought out business plan is one thing that nearly all successful companies have in common.  

Regardless of the size of your business, the benefits of having a strategy extend from your frontline staff through to management and shareholders. A formal strategy will help to align the efforts of everyone in your organization, and the supporting plan will outline how you will do it. 

How can a well-developed strategy help your company to operate at an optimal level?

First, a clear strategy helps to clarify business goals. The outcome of a great strategy is that anyone who looks at it will know your goals and how you will achieve them. Let’s say management’s goal is to increase revenue by 10% in 2024. All levels of staff, management and shareholders know that you must have a robust plan to achieve this goal. When you think about the plan (tactics) needed to grow revenue, you and your team can determine what will be the best path forward. 

To achieve this 10% increase in revenue, one of the sales team’s goals, for instance, may be to adopt and utilize a customer relationship management system, or CRM. To do this, the sales team should complete all CRM e-learning courses, meet weekly to review progress and meet in person monthly to review all key performance indicators, best practices and company financials.

This is a simple example of how a big business goal has been clarified at the team level. As you will see, the true success of a strategy comes from clarifying goals right down to the responsibilities of an individual employee.

Next, a clear strategy can provide a basis for decision making. Imagine that it is now March of 2024, and one of your top-performing salespeople tells you that they found a new CRM tool that utilizes artificial intelligence to fill out the CRM for them, allowing them to focus on cultivating relationships with existing customers. At first, this may sound like a great idea; however, when you look at your strategy, you have identified using the existing CRM as a focus for your sales team. In this situation, rather than deviate from the path, you can reaffirm to your salesperson that although this is a great idea, the company will need to stay the course for the time being. During the next strategy review, you can revisit this and determine if and where it fits into your overall goals.

When key changes occur in your business, referring back to the strategy allows you to always think about how you will achieve your goal by identifying the resources you need, the risks you face as well as the existing opportunities. Armed with this information, you will begin to think strategically. 

Increasing employee engagement is another main benefit of having a solid strategic plan in place. Management plays a vital role in communicating the strategic plan to its team members and working with them to create objectives that are relevant to the strategic plan. As an employee, you show up to work, complete what is asked of you, then rinse and repeat. 

The key to employee engagement is to help your employees connect what they are doing to a meaningful result. For instance, if your technical department knows the sales team is focused on growing revenue through existing relationships, then one of its key metrics should be based on the quality of support that the technical department is providing to existing customers. In turn, the technical department will track and report these interactions in the CRM, giving the salesperson a holistic view of the service that the customer receives. When everyone in your business understands how their contribution impacts their team, department, division and the overall business, they can work together more effectively. 

A good strategic plan can help to secure financing, too. A business plan supported with financials is a critical element to securing financing. Adding a strategic plan to this mix lets the lender or investor see that you are thinking in the short, mid- and long-term. The mid- to long-term thinking paints a picture of a business that is focused on winning but also on how it will get there. When this thinking is supported with strong tactics of achieving 10% revenue growth over the next two years, a lender or investor will have a better idea about how this goal will be achieved. 

While a detailed strategic plan may initially seem rigid, it can actually help to enable flexibility in your business. A strategic plan is not set in stone. It can and should be updated periodically to reflect changes in your business environment. By regularly reviewing and updating your plan, you can stay nimble and respond to changes in the market or unexpected challenges. Looking at the current economic environment with rising interest rates and increasing inflation, you may have to slow your investment in adding a new tech stack to your CRM. Meanwhile, you may want to continue to invest in training in the CRM, as this is a key success factor. A reasonable cadence in reviewing your strategy is quarterly.

Creating a strategy is not a task done in isolation. Instead, it requires engaging with your entire team from the warehouse right through to management and shareholders. 

So how exactly does a strategy come together? 

Information Gathering. Individuals in your organization know their functional role better than anyone else. They also are very aware of the challenges and opportunities within their role and department. Your aim is to create small working groups (3-8 people) within departments to facilitate brainstorming sessions. There is no right or wrong response in these sessions; you are just trying to create a collaborative space for idea sharing. 

This information can be divided into factors that are external to the company and those that are internal.

You may want to use a PEST chart (political, economic, social, technological) to capture a snapshot of the most relevant external influences on the company. In contrast, a SWOT chart (strengths, weaknesses, opportunities, threats) allows for a better look at the company’s internals. Enough can’t be said about the value of these one- or two-hour brainstorming sessions in connecting people and discussing how they see the company. After all, the people who are most closely connected to the work should have the best gauge of what is working and what is not.  

Figure 1. Developing a Formal Business Strategy

Clear Direction. What are your company’s vision and mission statements? Is everyone at your company aware of what these are? More often than not, I find people from all levels of staff who do not explicitly know what these statements are nor how they connect to what they do on a daily basis. 

The next question is, are these statements still relevant to your business today? This is a great opportunity to reinforce these statements or to rework them on a regular basis. This is the time to get everyone excited about your daily mission and, ultimately, where the company is headed in the future. 

Create Themes. Find common themes from your information gathering that need improvement or change. Once you have met with all teams and begin your analysis, you should be looking for emerging themes that more than one person has raised. It could be that your CRM is not easy to navigate, and a more intuitive interface would provide for a better user experience. When these common themes are identified, you can turn them into goals. 

Share Goals. Now that you have narrowed the themes down to a handful of the most important ones, turn them into SMART (specific, measurable, attainable, realistic, timely) goals. Do these goals link back to the big objectives management wants to achieve, such as the 10% revenue growth? At this stage, you can reengage with management to share these goals as well as how they connect to the company’s mission and vision. This is your chance to make further changes before sharing these goals with the broader organization. 

Tactics. Now that you have developed a few SMART goals, they must be broken down into smaller tasks, or tactics, to achieve the overarching goal. The only way to accomplish the company’s goals is with the efforts of each individual contributor. Your main objective is to grow the revenue by 10%, so one of your SMART goals could be to create a CRM workflow that increases sales staff engagement to 100% by the third quarter of 2024. 

Here are a few examples of how individual contributors from different departments can help to achieve this objective:

  • If I work in IT, one of my objectives will be to improve the CRM workflow experience by collecting feedback and piloting updates with the sales team between the first and second quarters. 
  • If I work in the technical department, one of my objectives will be to input my customer interactions into the CRM. To do this, I will work with IT to understand any changes being made to the workflow.
  • If I work in accounting, my objective will be to provide the sales team with data on customer discounts and volume purchasing. To do this, I will make notes in the CRM workflow.
  • If I work in shipping, my objective will be to let the sales team know of any delays or backorders for products. To do this, I will make notes in the CRM workflow. 
  • If I work in sales, my objective will be to utilize the CRM to better serve my customers fully. To do this, I will work with IT to map the current process and identify the required improvements. 

All of these individual contributions add up to improving the CRM workflow as well as enabling the company as a whole to meet its goal of increasing revenue by 10%. That is the power of a strategy. 

It is vital to remember that a strategy cannot be developed or carried out in isolation. To be effective, you must involve all levels of staff. When it comes time to execute, the role of management is to communicate and get team members involved in creating meaningful objectives and providing updates through a feedback loop. At the end of the day, you are running a team—no different than any of your favorite professional sports teams—and a strategy helps everyone to know how they can contribute to a win.  

Ron Ramesh has been involved in the automotive service, fuels and home services industries since 2004. He currently serves as the CEO of The Franchise Strategy Co., a division of New Path Ventures Co. Utilizing industry expertise and technology such as AI, The Franchise Strategy Co. creates effective business, marketing and operational strategies to help achieve business goals.

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