A vision and mission by themselves won’t actually make anything happen. You need to work out what actions you need to do to turn your vision into a reality and docu- ment it in a strategic plan. What you document, you can monitor, measure and amend when appropriate.
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Table 1.3.1 The vocabulary of strategy
Term Definition Personal example
Mission Overriding purpose of the business, in line with the values and
expectations of the stakeholders
Be healthy and fit
Vision Desired future state; an aspiration
To run the London marathon next year
Goal General statement of aim or
purpose
Lose weight and strengthen muscles Objective A precise statement of the goal Lose 7 pounds by 31
December and run the London Marathon next year
Capabilities and scope Resources, activities and processes.
Some will be unique and provide
‘competitive advantage’
Proximity to fitness centre, a successful diet
Strategies Long-term direction Exercise regularly,
compete in marathons, diet appropriately Controls The monitoring of actions in order
to assess the effectiveness of strategies and actions and be able to modify them as necessary
On a weekly basis measure and monitor weight in pounds, the number of miles run and the time taken. If goals not achieved consider alternative strategies and actions
Strategic plan
Any supporting strategic plan should include the mission, values and vision state- ments plus the following in some detail:
ᔡ Marketing and sales: Having a good value proposition does not mean that your products and services will sell themselves! You need to create a new business strat- egy that will support the strategic objectives of the business, creating new business opportunities day in and day out, regardless of the current economic climate. This will involve many things, including the building of targeted databases, appoint- ment-getting strategies, the provision of collateral, leave-behinds, credentials, pitch documents, proposal outlines, contracts etc.
ᔡ Clients: Having won your ideal client you need to create individual client develop- ment strategies which should be reviewed on a regular basis. Such strategies should ensure that you maximize the long-term value of client relationships by a variety of means, including: cross-selling or up-selling, creation of long-term contracts, winning repeat business, performance questionnaires, wining and dining (where appropriate) etc.
ᔡ Human capital: None of the above will be possible without the ability to recruit and retain talented individuals. Your talent management strategy will help you understand exactly what talents, skills and experiences your business needs to succeed in the long term. It will define where future employees will come from, how you will remunerate, train and reward them. In order to grow you will need to create succession plans enabling you to promote or replace key staff, which in turn will support the organizational structure you need to achieve your long-term goals. Above all, you should have a strategy that creates a culture of confidence, profitability and enjoyment that stakeholders (whether they be employees, clients or suppliers) want to work with.
ᔡ Innovation: Plan to create a business, and products and services, that others will want to emulate. You should also build in time to think of new ideas and new ways of doing things. Encourage all your employees to find time to think about the future, to innovate and to be creative. The insights gained will help you put clear water between you and your competitors in the future.
ᔡ Profitability: Profit strategies should recognize that all corporations are in busi- ness to make money (even not-for-profit organizations have to show that they have put their hard-won donations to good use). Net profit margins should be stretching, achievable and, above all, sustainable. They should not be set at such a level that they are too easy to achieve, nor so hard that they create a culture of
‘win at all costs’. Profit strategies should take account of client satisfaction, cash generation and stakeholder needs (including shareholders, employees, partners, suppliers etc).
An old adage states that ‘turnover is vanity and cash flow is sanity’. Being very profitable on a small turnover is as precarious, however, as being marginally prof- itable on a large turnover. Getting the balance right between turnover, profitabil- ity and cash flow, and understanding the consequences, is very important for the long-term growth and success of your business.
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ᔡ Key performance indicators: Define measures of success (eg turnover per employee, ROI etc) and then use them to benchmark your business against its past performance, your competitors and your business plans. Make sure that you review and act on the information you collect on a regular basis.
It is worth remembering that Noam Chomsky said ‘Whoever sets the agenda controls the outcome’. If you create a vision for your business, communicate it, monitor and adapt it for changing market conditions, you are more likely to achieve it than if you sit back and hope for the best. But – you can’t do it all on your own! Your vision will never happen unless you connect your strategy to action plans; you employ talented, empowered people and allocate them roles and responsibilities; you identify, monitor and act on critical success factors and reward those employees who make it happen accordingly. As Henry Ford said:
‘You can’t build a reputation on what you’re going to do. It’s simple: fantasize, rehearse, then go out into the world and DO IT!’
Allison McSparron-Edwards has worked for many years in the service sector.
She began life as a Chartered Accountant with one of the top six accountancy firms before using her management skills in various multinational organizations and marketing and communications agencies. She has worked at board level in regional and London agencies, using strategy, new business development programmes and psychologically based management skills to improve commer- cial returns. Allison combines a shrewd business sense with the ability to under- stand the human issues involved in any group working together. Honest and forthright, she tells it how it is. Consultrix Ltd works with creative and knowl- edge-based companies improving profits and capital value.
For more information contact: Allison McSparron-Edwards BSc Hon Geology, BSc Hon Psychology, ACA, Managing Director, Consultrix Ltd
Tel: 01793 726128 www.consultrix.co.uk
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