Every quarter the board gets together to discuss the company’s direction. The meeting will normally be led by either the CEO or the CSO, yet encourages feedback and interaction from a number of senior executives whose roles are directly linked to the organization’s outlook.
The Harvard Business Review - one of the eminent voices in company strategy - recently cited research which claimed that only 29% of company employees can correctly identify their company’s strategy when given six options.
This would seem to suggest that most are happy to just nod their heads and smile when discussing strategy.
Below, we look at four other major strategic mistakes companies can make.
Overestimating organizational strengths
It’s rare for a company to underestimate its strengths, as that does little to breed confidence in the company’s staff. Yet senior management should also be wary of overplaying how well their company can cope with change.
A strategic plan must have the capabilities of the company at its core. This means that the CEO must make strides to identify the company’s strengths and weaknesses and plan appropriately.
Thinking you’re too good at something to then find out you aren’t, equates to lost time and probably money too.
Promote risk but punish failure
Most successful companies take risks on a regular basis. Whether it’s shifting production somewhere new, venturing into new markets, or investing more money in marketing; risk plays an important role in company strategy.
Through innovation, companies must actively encourage their employees to get onboard with risky projects, assuring them that failure won’t necessarily be punished if things don’t work out. This doesn’t sit well with certain companies - telling employees that it’s OK to fail might set them up to do just that - as the pressure they place on their staff is central to their ability to motivate them to work towards specific goals.
Clearly there’s a happy medium to be had. But if a team does all it can to make something succeed, they shouldn’t be punished for being unable to make it work. Taking risks - regardless of who is working on a project - can always fail and companies shouldn’t punish people for being involved in a project that was destined to fail.
Not involving everyone
Although it’s impossible for everyone to get involved in the planning process - if they were, nothing would get done - once a plan’s been devised it should be communicated to everyone in the company.
Not only should they be told, they should be actively encouraged to contribute ideas as to how the strategy could be improved upon.
Not putting enough emphasis on timing
Timing is important from two perspectives.
First, a company must work out how long the process is going to take - as this will give them a good idea about how to allocate resources - and secondly, at what time during the year they’re going to start it.
It’s also essential that your timing works in conjunction with your budgeting process.