Progress is best built on strong foundations with a clear sight of the summit to be reached. But in today’s competitive marketplace where there are many distractions, multiple options and lots of noise, it is easy to become overwhelmed. Clarity, however, can be achieved through anchoring your strategy.
Active Knowledge Question:
How do you ensure that your business is always heading in the right direction?
There are many options available when it comes to plotting the way forward for a business. Do you seek to build a platform and control it, create an ecosystem and invite others to participate, build strategic partnerships, invest in core competencies and license these discoveries to others, control strategic assets, and so the list can continue?
There are so many growth options put forward these days, so much jargon, lots of noise to confuse everyone, so much uncertainty and change, that it can all become too mind-boggling.
So when it all becomes too much, you pause, take a step away, gain perspective and remember why your business exists.
Some would say that their business exists to maximise its profit and that honestly would likely put them back in the middle of the confusion. Profit is an outcome, a result, of the activity of the business and seeking to maximise it typically undermines performance and weakens competitiveness.
The confusion, the noise, the doubt is cut through by anchoring your strategy and from that ‘rock’, that foundation, looking upward and seeing customer need.
The Elements Of Your Anchor
Anchoring your strategy involves:
- Re-establishing the purpose for your business;
- A relentless customer focus and
- Your vision, better expressed as the quest, for your business.
‘I know the foundations upon which I stand, I clearly see the need I seek to fulfil, and I have imagined where I am taking this business to – the impossible is now possible.’
Knowing what paths you will not follow as a business can bring clarity to your strategy, but you can only know that by knowing what you will pursue. Often that single-minded clarity does not exist in a business, and its leaders are continually distracted by considering options that simply are not consistent with its anchor.
There is a resurgence in the language of purpose in business today. But it is still confused with the notion that businesses exist to profiteer. Allowing a profit-first motive to preside in your business will only disperse and neutralise its competitiveness and therefore, its potential profit. Be focused on profit and your business will likely earn less profit than it could otherwise earn.
There are two elements to purpose:
- The need that your business seeks to meet in the community, and
- The motive that underpins its existence.
Purpose is the cornerstone and reference point for the existence of your business. Real competitive strength lies in that purpose, and everything else builds upon it. Purpose reveals opportunities, ensures alignment, and a compounding of effort. Such a purpose is only founded in meeting customer need.
The right purpose can be powerful in underpinning the long-term and compounding success of a business:
- It clearly defines the need you seek to meet in the community and therefore keeps everyone focused on the customer value you are competing to deliver.
- Through this focus, you can become the best of the best in meeting that need and outcompete everyone else in your chosen marketplace.
- That focus on need will become a source of innovation and growth and allow you to lead change rather than chasing it.
- It prevents you from being distracted and chasing every opportunity that comes along.
- It supports emergent strategies and can serve to challenge paradigms that may exist in your business.
Steve Jobs saw Apple’s purpose as ‘to make a contribution to the world by making tools for the mind that advance humankind.’
In 2017 it was amended to be ‘Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.’
And there would seem to be variations around this latter statement, but which do believe casts a better purpose for Apple?
And what about your business? Is there a purpose for the existence of your business, apart from profit, and how well does it cast everyone’s gaze towards customer need for today and tomorrow?
Purpose and motive go hand in hand; they are a partnership. You cannot say that your purpose is to meet a certain need in the community and then proceed with a motive of profit-first. They are incompatible.
Where a purpose of meeting need exists, the motive can only be to compete. That is to deliver the greatest customer value that you are able to today and tomorrow. And if you do that well, then great profits will be one of the outcomes.
Customer Focus and Competitive Posture
A focus on your customers requires that they come first in all your actions and decisions.
Your business exists to meet their needs today and into the future. They are today’s and tomorrow’s lifeblood and the compass for future direction. Failing to place them first is to allow yourself to be defeated in your chosen marketplace.
Your understanding of customer need is best described as intimate. So close, you know it well, but at the same time, you can step away from it to understand change, impact, evolution, and opportunity.
Your customer focus reflects the way you think, organise the business, and the basis upon which decisions are made. It reflects the business’s purpose for being.
Decisions are made on the basis of ‘how will that impact the value we are able to deliver to our customers’? Improving customer value is the goal.
Posture reflects how you have chosen to compete and is an expression of your business strategy. Your posture allows you to deliver the greatest customer value leveraging your capability as a business.
And while capability will influence how you compete, ultimately it must be tailored, crafted, and built to enable you to outcompete all others in your chosen market. Capabilities cannot be left to chance or simply what exists today.
The competitive posture of your business is an outcome of the way you view customer need. It is targeted at a specific need and built upon your capability to lift those strengths to the forefront and to meet those needs.
But need and value are complex. There are many unique positions that you can take within that matrix which allow you to position your offerings so they outcompete others in your chosen market.
The core competitive strength of your business lies in the combined talent and effort that you are able to muster from everyone who works within and with your business.
Your quest, your vision, is a vital element of anchoring your strategy. It sets not only trajectory but provides the glue and energy to propel your business forward. It will either win the hearts and minds of everyone or simply falter and have little meaning.
Your quest is a clear image of where your business must move to and is fueled by a conviction that it is a destination that must be reached. Reached not because of profits but because of the value it delivers to the community of customers you seek to serve as a business.
Powerful visions echo what is already in the heart. They call out what is already sought but not expressed. They should inspire the impossible and carry conviction, action, determination and completion.
‘Our business exists for a real and righteous purpose. One which everyone can feel a pride in and contribute to. It has a purpose beyond profit, a purpose that contributes real value to our community.
We know clearly the needs of the community we seek to serve and where those needs are tracking to. We have and are continuing to compound our capabilities to deliver greater customer value every day.
And we have a vision of where we can take that customer value to. A vision that may seem impossible to many, but it has become our quest as a business. And one which will see us outcompete everyone else today and tomorrow.’
Anchoring your strategy is not an academic or intellectual exercise. Many boards struggle with such a task as it requires an intimate connection with the customer, a real empathy with their needs and imagination as where customer value might be taken. It requires that you live the business.
An entirely new level of performance.
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All the best in the success of your business,