Is Your Strategy Driving Your Strategy?

Is Your Strategy Driving Your Strategy?

What’s driving your bus? Is your organization’s direction the logical result of a strategy you’ve put in place or are there other significant factors dictating where you’re going. In this episode, David and Justin discuss the importance of setting direction and how easy it is to get off the beaten path. Here are the notes from the show:

  • David and Justin share some pretty amazing stories about outside factors that have influenced their attempts at setting strategic direction. In particular, the importance of aligning strategy with execution as well as capabilities.
  • We discuss Strategy that Works by Paul Leinwand and Cesare Mainardi. In their book, Paul and Cesare did a lot of surveying of top leaders about strategy and execution. Some of their results were:
    • 2/3rds of companies said their capabilities do not support their strategy
    • 9/10 companies were missing opportunities that their strategy said they should be winning
    • 80% said their strategy is not well understood inside their company
    • Only 8% said they believed they were both good at strategy and execution
  • The road to strategy is narrow (see Matthew 7:13!)
  • 5 ways successful companies align their capabilities with their strategy
    • Choose a core identity
    • Link cross functional capabilities behind your core
    • Reorganize your organization to best utilize the existing culture
    • Cut costs in non-core areas
    • Shape future by reimagining your core capabilities instead of reinventing
  • “Choosing a core identity” is the first rule; and the first to be broken. We like “Positioning for Professionals” by Tim Williams as a good read for understand the counterintuitive rule that focus leads to scale.
  • Reorganization needs to be done around your culture; not by upending your culture. Want to “map” your culture and impact it? Check out the Culture Map from Strategyzer.
  • Underlying all of this wisdom is understanding companies as living systems and not as machines. Machines can be rebuilt into whatever form you want them to be to accomplish very different tasks. Living systems, on the other hand, all have a given genetic code, that, for the most part, cannot be altered into something completely different.

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