Knowing What Not To Do: Why Strategy is Important to Irish SMEs
All businesses large and small have goals, either explicit in a mission statement, or implicit in the minds of the management and the focus of teams. Often the vision or goals are to do with how the company envisages business developing or growing to new markets; maximising sales and efficiencies, and how to find a USP or niche in a busy marketplace.
Often, when businesses have strategy days, or produce strategy documents, they focus on where they want to be, their priorities and decisions around where to focus. These days can be time and resource heavy, and because such kind of deep work days are rare, they can often devolve into discussions around what’s wrong at an operational level, or HR and other management issues which have not been addressed throughout the year.
Less common is conducting a strategic planning process and ending up with a clear roadmap for not only where the business should focus and prioritise efforts, but exactly how the business will achieve these goals.
A strategy should be a crystal clear document providing the ultimate in direction for your business, should be actionable and available to everyone on any team. You need a north star, a compass for your company – and a strong strategic plan will be that direction.
Without strategy, management often describe feeling like busy fools. They are incredibly pressured, are doing lots of activity and spreading themselves thinly, with no real plan, focus, or finish line in sight. Trying lots of things to see if they stick, chasing your tail, but never achieving anything concrete is demoralising for staff and management alike. Having no clear objectives mean your team and resources are probably wasting time and energy on low-priority tasks or areas of focus.
If you have a strategic plan and you are not sure if its working for you, you should look for signs of this lack of direction. Sales is a classic time-sucking enterprise when there’s no clear, useful strategy in place. Unless time has been invested in a marketing strategy, the business may not know and understand their customer, and can easily spend months and years chasing ‘the general public’.
Questioning the value of strategic planning is very common – because planning can be intense and time consuming, but indifference towards planning can take root in an organisation and create problems from the top down. Sometimes, business owners can equate a strategy with a lack of agility – and believe a rigid plan will limit opportunities as they present themselves. In some SMEs in particular, a strategy may feel imprisoning. A good strategy should, however, have significant opportunity for agility baked into it. Small businesses may have to pivot, or at least shift course and direction as deals are won and lost which may impact the business significantly. A good strategic planning consultant will be able to work with you to ensure you are not blindly sticking to a plan that isnt working, and that your strategy is focused on exactly what you business is, wants to be, and your mission and values.
Strategy must be all inclusive, with buy-in at every level of operations if its going to work. In most organisations where there’s a couple of departments and moving parts; it should be accompanied by operational plans to actually get the things done.
Not only will strategy help businesses to consciously plan and set goals and objectives, a strong strategy will help businesses stay in line with changes, developments and trends in your industry. The old adage ‘fail to plan, plan to fail,’ is bandied around a lot in business circles, but its an old saying for a reason. And if that plan is in your head and not in the heads of your teams, you can probably plan to fail, too.
A strategy delineates a territory in which a company seeks to be unique.
Some useful reading on strategy for small businesses:
Blue Ocean Strategy, Expanded Edition: How to Create Uncontested Market Space and Make the Competition Irrelevant by W. Chan Kim
Small Giants: Companies That Choose to Be Great Instead of Big, by Bo Burlingham
Great by Choice: Uncertainty, Chaos, and Luck-Why Some Thrive Despite Them All, by Jim Collins
Playing to Win: How Strategy Really Works, by AG Lafley