CEOs and investors often express that they don’t have time to develop a meaningful strategy. They view strategy as an onerous corporate initiative that consumes executive bandwidth without delivering tangible business results.
However, the greatest obstacle to crafting winning strategies that foster high-performing teams is when strategy becomes a people issue. We’ve identified four common reasons for this:
- Ambiguity of the Term “Strategy”: The word “strategy” can mean different things to different people, often losing its relevance due to overuse. Developing a strategy requires specialized expertise to define what strategy means for a team and to guide them through a structured process to identify the critical elements for their specific business.
- Variability in Financial Literacy and Business Acumen: Team members often possess varying levels of understanding regarding how the company generates revenue and drives results. It’s essential for teams to regularly review the Profit and Loss (P&L) statement together and develop a Strategic Performance Dashboard to build a common understanding of the key factors influencing financial and business outcomes.
- Lack of Data Leads to Subjective Decision-Making: Without access to relevant data, teams may resort to wishful or fearful thinking when it comes to strategy. Utilizing current and accurate data is crucial for uncovering new insights and addressing challenging questions about future opportunities.
- Challenges in Future-Oriented Thinking: Strategy requires individuals to think critically about the future, which is often difficult as we are not inherently wired to envision it dispassionately. Leaders must inspire their teams around a future vision and strategy, overcoming the noise created by personal hopes, fears, and uncertainties that can cloud clear thinking.
Addressing the people aspect of strategy begins with a commitment to effective communication across the team. This involves clearly defining strategy, enhancing financial literacy and business acumen, leveraging the right data to tackle tough questions, and uniting the team around a future that prioritizes what matters most. While the future is inherently uncertain, a well-defined strategy is the best tool leaders have to guide their teams toward winning outcomes.