In August, 1833, a volcano on the island of Krakatoa erupted. It sent pyroclastic flows 25 miles into the air. The explosion was heard 2,800 miles away. As a result of the ash and debris, average global temperatures fell by as much as 1.2 degrees for the next five years. That’s what you call power at work.
Now let’s consider your strategy. Is it a force of nature, driving you forward, drawing gasps of admiration? Is it a sleeping giant, waiting to be put into practice? Or, worse still, is it no longer fit for purpose, doing nothing to help your business – is it extinct?
You may ask – why does it matter what state your strategy is in? You could have grown to a reasonable size without a robust plan, or just winged it. But ask yourself how much bigger do you expect to grow? How are you placed to deal with a major downturn? Are you still able to attract investment? What do your team and your customers feel about your plan, or rather lack of it? Not having an active strategy in place means putting your faith in hope, rather than facts, data and information. You may get away with it for a while. But how many gamblers stay lucky forever? We bet the answer is none.
Let’s take a closer look at the three types of strategy.
Having a meaningful, active strategy can be the difference between success and failure. Having dealt with hundreds of UK businesses, we’ve found that the successful ones all have one thing in common – a coherent strategy, that is worked on and implemented regularly.
When businesses are very small they can sometimes get away for a short while without an active strategy. But energy and enthusiasm can only get you so far. As you get bigger you’ll experience growing pains in key areas – sales, marketing, operations, finance and talent. Big, successful companies get to stay big and successful by having active strategies in place, that can deal with problems as and when they occur. Their strategies give them, their customers, and their investors reassurance and confidence that they know what they’re doing.
Smaller businesses tend to be much less active with their strategies. Is it any surprise that a meagre 4% of businesses make it to the £1m turnover mark, and only 0.4% make it to the £10m target? By having an active strategy in place you’ll find yourself in a much stronger position to scale up.
The neglected strategy is a common occurrence in British business. From our research fewer than 37% of companies implement their strategy on a regular basis. But if they felt it was important enough to come up with a strategy, why didn’t they think it was important enough to put it into practice? Perhaps they’re too busy to pay it much attention.
That in turn tells us that something is broken. It’s usually a talent/finance issue. You’d need more talent to give you more time, but you haven’t the finances to hire the talent. Sound familiar? All roads lead back to strategy. Where is your talent management strategy? Where is the financial management strategy? By having these in place you can head off the finance/talent conundrum before it arises.
Unfortunately, many owners carrying on with a sleeping strategy, failing to put it into action. Is it any wonder that so many businesses come unstuck? Without the guidance and clarity that strategy can give you, they lose focus, they lose clarity, and they ultimately lose customers. An active strategy can hold your business together. It can act as a beacon, uniting your team, bringing certainty, and motivating those around you. To just let it go to sleep is to unplug one of the most powerful tools a business has in order to scale up.
You started your business with huge amounts of energy and excitement. You had a strategy that brought you talent, drew investment, and helped you take off. But now, years later, what’s happened to it? It’s gone the way of the Dodo. While everything about your business will have changed – your team, your goals, your customers, your marketing, your financing – your strategy lies buried in a file. It’s no longer fit for purpose. It’s extinct.
A strategy needs to be malleable and meaningful in order to deal with the ebb and flow of your business and the market you’re in. Consider how the internet has changed everything. You wouldn’t dream of going back to pre-internet practices, so why think that a defunct strategy is going to help you grow? You need to adapt and adopt in order to keep up with your competitors, attract customers, and make the most of new opportunities. It’s the same with your strategy. It’s a living thing. It needs to be current. It needs to be relevant. It needs to be active.
To discover whether your strategy is active, dormant or extinct take the Certainty Scorecard Test. In just three minutes you will see how your business strategy is performing.