The greatest difficulty encountered by most leaders when it comes to developing strategy is how to start. The enormous scope of what is possible creates an insurmountable obstacle and is often the reason serious strategic thought or planning does not occur. More often than not, discerning the why is far more difficult than figuring out the what.
When starting the strategy process in a new environment I have found it useful to keep in mind a fantastic piece written by Zabriskie and Huellmantel in 1991 that highlights the importance of strategic questions. To my mind, it helps clarify how to start your strategic planning process.
The setting of strategic questions allows the leader to direct and control the planning process and, importantly, keep it on target. However attention needs to be paid to the questions to ensure that they are strategic in nature. Critical or important questions are not necessarily strategic. In the terms of strategic planning, your strategic question should pass five simple tests:
- Does the question define your organisation’s relationship with its external environment? If the question relates to how you can increase your profit margin through production efficiency then it is not likely to be strategic. Important yes, but not strategic. If you are however, looking to create a situation where you can significantly under-cut your competitors and thus redefine the way your customers relate to you – that could be strategic in nature. It’s about changing your relationship with the market, customers, competitors or even contractors.
- Does it take the whole organisation into consideration as a unit of analysis? Dependent sub-units are unable to ‘do strategy’ as they are reliant on the greater organisation to enable their capabilities. Thus any question that only looks to improve or change sub-units will inevitably be tactical in nature. The exception of course, would be if it changes the way the organisation, as a whole unit, operates.
- Is the question multi-functional in character? Does it rely on more than one functional area for information? Similar to the previous test, the key is looking at the organisation as a whole. If you are only relying upon one functional area for information, it indicates that you are only looking to make a minor improvement that is limited in functionality.
- Will the question result in direction for, and constraints on, organisational growth and development activities – specifically on people? This is critical and is linked to your organisational vision. The ability to provide direction to the organisation frames (or constrains) the limits of growth in certain areas. How will you best optimise your organisation, what activities are useful and what are not. Ultimately the direction will also limit the growth of your people to the areas that move your organisation in the direction of your vision.
- Is the question of major importance to the growth and success of the organisation? Finally, will the answers to your questions actually matter or are you just playing in the edges?
Once you have your list of questions, you can then focus on the more laborious, though often easier, work of planning. So simple!