Oct 4, 2010

Developing Strategy is Fun. Implementing It Is Work.

In my consulting business, I've often said, (and more often thought), that good business planning is 9 parts implementation for every 1 part strategy.

I have argued for years that implementation, not strategy, is what usually separates winners from losers in most industries, and generally explains the difference between success and failure in most organizational change efforts, sales campaigns and so on.

It could be that strategy is very important to the success of firms, but it does not explain differences among firms in an industry because following the right strategy is required to stay alive. Executing strategy explains the differences in performance among living firms.

So you could say this is a matter of survivor bias; we only here about the winners, which, presumably, had effective strategy. The losers don’t have a voice. That’s an interesting thought. But I also think most good business strategies are relatively obvious, particularly if you look at entrepreneurship and small business. Do a SWOT (strengths, weaknesses, opportunities, and threats) analysis. Look at how your company is different. Look at how you match that difference with what you offer, and to whom you offer it. And then bear down, get realistic, and focus on your keys to success, and what you can actually do well. Presto, business strategy.

And how about this one: Better to have a mediocre long-term strategy consistently applied for years than a series of brilliant but contradictory strategies that never last long enough to matter.

Developing creative new innovative strategy is fun, but most good strategies are sort of boring, particularly when you keep to them over the long term. Implementing strategy is work.