The myths never end. Lightning never strikes the same place twice (it does). There is no gravity in space (there is, just less). Humans only use 10% of their brains (we use more). So which strategic myths or half-truths is your brand following? Let’s face it—running a business on myths is a flawed strategy.
A study of 10,000 senior executives showed that the most important leadership behavior critical to company success is strategic thinking at 97%. It is important to understand the strategy myths that may be keeping your team from reaching greater levels of success.
Let’s break down some of the more popular business myths:
Strategy Myth #1: Strategy comes from somebody else
“We get our strategy from the brand team/upper management.” This is a common refrain when managers in other functional areas are asked who develops strategy. It is also wrong. The strategy you execute should be your own. Why? Because each group’s resources are different. For example, the sales team has different resources—time, talent and budget—than the marketing, IT or HR team. How they allocate those resources determines their real-world strategy. It is important to understand company, product and other functional group strategies to ensure your strategies are in alignment. But their strategies are not a replacement for yours.
Myth Buster — Identify the corporate strategies, product strategies, functional group strategies and your strategies, and seek alignment.
Strategy Myth #2: Strategy is a once-a-year process
In a recent webinar presented to more than 300 CEOs—“Is Your Organization Strategic?”—the question was posed, “How often do you and your team meet to update your strategies?” The percentage of CEOs who meet with their teams to assess and calibrate strategies more frequently than four times a year is only 16.9%, with nearly 50% saying once a year or, “we don’t meet at all to discuss strategy.”
A study of more than 200 large companies showed that the No. 1 driver of revenue growth is the reallocation of resources throughout the year from underperforming areas to areas with greater potential. Strategy is the primary vehicle for making these vital resource reallocation decisions, but as the survey showed, most leaders are not putting themselves or their teams in a position to succeed. If strategy in your organization is an annual event, you will not achieve sustained success.
It is important to understand the strategy myths that may be keeping your team from reaching greater levels of success.
Myth Buster — Conduct a monthly strategy tune-up where groups at all levels meet for one to two hours to review and calibrate their strategies.
Strategy Myth #3: Execution of strategy is more important than the strategy itself
A landmark 25-year study of 750 bankruptcies showed that the No. 1 cause of bankruptcy was flawed strategy, not poor execution. You can have the most skilled driver and highest performance Ferrari in the world, but if you are driving that Ferrari on a road headed over a cliff, you are finished. A sure sign of a needlessly myopic view is that everything is an “either or,” rather than allowing for “and.” Strategy and execution are both important, but all great businesses begin with an insightful strategy.
Myth Buster — Take time to create a differentiated strategy built on insights that lead to unique customer value and then shape an execution plan that includes roles, responsibilities, communication vehicles, time frames and metrics.
Strategy Myth #4: Strategy is about being better than the competition
Your products and services are not better than your competitors. Why? Because “better” is subjective. “Is our product better than the competition?” is the wrong question. The real one is, “How is our product different from the competitor’s product in ways that customers value?”
Attempting to be better than the competition leads to a race of “best practices,” which results in competitive convergence. Doing the same things in the same ways as competitors, only trying to do them a little faster or better, blurs the line of value between your company and competitors. Remember that competitive advantage is defined as “providing superior value to customers”—it is not “beating the competition by being better.”
Myth Buster — Identify your differentiated value to specific customer groups by writing out your value proposition in one sentence.
Strategy Myth #5: Strategy is the same as mission, vision or goals
Since strategy is an abstract concept, it is often interchanged with the terms vision, mission and goals. How many times have you seen or heard a strategy that is “to be No. 1” or “to become the premier provider of …”? Mission is your current purpose and vision is your future purpose, or aspirational end-game. Goals are what you are trying to achieve. And strategy is how you will get there.
Starting with an inexact statement of strategy will derail all of the other aspects of your planning and turn your business into the equivalent of the grammar school volcano science project with red-dyed vinegar and too much baking soda.
Myth Buster — Clearly distinguish your goals, strategies, mission and vision from one another.
If left unchecked, strategy myths can cause you and your business to fail. A 10-year study of 103 companies showed that the No. 1 one cause of business failure is bad strategy. Arm your team with the strategy myth busters and your business will soar higher than a pigeon with a belly full of uncooked rice.