How to successfully manage strategy to execution in uncertainty
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As executives get lost in day-to-day handling of business, strategic review is often considered as something to be approached after a specific amount of time, or after a significant corporate or economic event. Executives often look to delay until they feel they have the time to consider and define a long-term strategy, plan to execute it systematically, and then sustain the resulting competitive advantage due to the unique strategic insights. However, as we all experience now, reality is rarely so organized. Revolutionary technological developments, significant regulatory or policy changes, new approaches in choices made by customers, variations in macroeconomic variables, and competitors can stymie the best laid out plans.
As the world prepares to enter the second year of the pandemic, uncertainty is high and creates difficulty in being able to define and execute a strategy with so many unknown variables. But we know that not only this uncertainty is here to stay, but that looking back over the last few decades situations of significant disruption brought about by global events are faster and stronger. Living and sustaining advantages throughout these events means the ability to abandon the view of strategy as a straight-line execution reviewed every few years and left with a gap to be executable, to approach strategy as a recurring action that allows the company the agility to adapt to changing circumstances.
Donald Sull (MIT Sloan) describes it as the Strategy Loop, a 4-step process focused on bridging the gap between strategy and execution. A) Create a common understanding of the existing internal and external situation, developing and challenging existing assumptions on where we are, and where we are currently headed. B) Make clear choices on what are the priorities targets and allocated resources, clarifying what will be done and what will we stop doing. C) Execute with a view to make things happen, focusing on results based on targets and guaranteeing the necessary support to those on the ground. D) Set up a review strategy and targets focused on reviewing assumptions held, what led to the results and what needs to change.
At Cluster Advisory we are focused in creating value through actionable strategies with entrepreneurs and executives. Although doubts remain about the speed and impact of vaccines companies need to prepare a managed recovery gameplan to handle going through and coming out of the pandemic. Not only defining an executable strategy for what happens as restrictions are relaxed, but looking specifically at: identifying which new markets or segments they want to target, and how to target them; understanding how to handle different markets recovering at different speeds; adapting the supply chain and delivery logistics model to increased proximity and the rise in delivery platforms and informal networks; increasing focus on the right R&D for each firm; and recognizing and adjusting to new export capabilities.
Cluster Advisory is an International boutique advisory firm, focused on Strategy, Corporate Finance and M&A.