Your organization has several functions and is further categorized into various levels. Warren Buffett says, “we don’t necessarily have to be smarter than the rest, we must just be more disciplined.”
Create effective communication plan
The foundation to creating a disciplined culture is to develop an effective communication plan. A strategic framework ensures all the wheels in your organization are aligned and targeting the same goals. Intrinsically, it is a tool that clearly lays out the targets and goals an organization must achieve within a stipulated time frame. From an external standpoint, a strategic framework embodies your core purpose.
Models and matrix to evaluate biz plans
The nature of an organization's business and its goals govern the kind of framework that companies would deploy to formulate a strategic plan. The BCG matrix and GE-McKinsey nine-box matrix are some of the tried and tested strategic models used across sectors and industries for evaluation of Business Units/product lines to develop the most appropriate investment plans.
Another well-known model is the Ansoff’s matrix that helps to implement a growth strategy while addressing associated risks. Businesses that are inwardly focused and keen to foster competitiveness within their team tend to choose value chain analysis, as this type of analysis also enables comparison against a benchmark in their business.
Developing customs frameworks suited to biz type
If an organization’s leaders can master the principle of developing custom frameworks that are perfectly suited for the business type, its objectives, and the environment it operates in, a strategy framework can help the company achieve great success. Furthermore, the strategy framework can be integrated with existing business philosophies such as lean or theory of constraints. The organization can have customized strategy frameworks that can help create the right action plans and KPIs across functions and hierarchies.
While the recipe to develop your own framework may vary, the ingredients remain the same. To develop an actionable strategy framework for your organization, you must make a flowchart starting with the question “What is the strategic plan for my business segment?” This must always be broken down into two questions: “What facts do we know?” and “What actions need to be taken?” Each of these questions should then be further divided into sub-questions.
The first question may be answered in three parts: defining your company’s goals and vision, understanding opportunities in the existing business segment, and determining your company’s position in the market. The second question can be answered in two parts: understanding the requirement to win in the market and determining its operational and financial implications. Based on the nature of the business, these buckets can be loaded with insights and empirical action points.
If this process is followed to create a strategic plan, it would not only help ensure you are aligned with the vision and mission statement but also attain maximum efficiency and minimize unnecessary spending as all team members work toward the same goals. Ultimately, a well-defined plan that would help foresee growth, backed by specific action points, would encourage investors to fund expansionary projects and programs.
(Aniruddha Mokashi is Manager, Growth Advisory, Aranca. Views are personal.)