38 THE NAFCU JOURNAL MAY–JUNE 2022 For more than 30 years, I have been helping companies develop their business strategy, and I’ve seen many organizations fall into the same traps. Here are just a few: 1. Going with the first right answer Throughout our scholastic careers, we are taught that if we want to get an “A” on the test, we have to find the one right answer. Then, we graduated and realized that there is no one right answer in many situations; rather, there are multiple possible solutions. Good strategists find one great solution, then set it aside and look for another possible solution, and then another. Typically, combining these three ideas coalesces into the best possible strategic decision. 2. Inviting too many people to the meeting Here is the rule: invite only those with a strategic mindset who understand the company deeply enough to give meaningful input. It’s assured that if you ask someone who isn’t entirely up to speed, you will spend an inordinate amount of time explaining the situation. I am not saying that only the senior management team should set the strategy, but it is best to keep strategy meetings limited to people who genuinely have their finger on the pulse of the business. 3. Making up numbers I have been flabbergasted in some strategy meetings where senior executives will throw out numbers with no basis in LEADERSHIP DOWNLOAD SIX TACTICS TO AVOID WHEN IMPLEMENTING A STRATEGY By John Spence reality. Here is an actual example where the names have been changed to protect the innocent. Mary is asked, “What do you think the revenue looks like for the European division this year?” She replies, “Well, Bob, we did 15 million this year. I think we can get above 17 next year.” To which Bob says, “Okay, I’ll put you down for 22 million. I think that’s a reasonable stretch goal.” And then subsequently every department head now bears the burden of this unrealistic expectation as they go around the table. To avoid this, make sure that you deal with real numbers that are accurate and timely. Look at historical trendlines to get a feel for where the market is likely moving. Consider any external factors that might either positively or negatively impact your business. When you make a prediction, make it real. 4. One of the essential words in strategy: No At its foundation, all strategy is simply the allocation of scarce resources. Even Google and Amazon have limited resources. So, to build a solid strategy, you must have the courage to say, “No.” If you’re going to say “yes” to a lot of new things, you must effectively take other things off the table. 5. Lack of execution I have been teaching strategy for the Securities Industry Institute at the Wharton School of Business for more than 20 years. In my lectures, I typically get about 120 senior executives from the financial industry. Each year, I ask them the same question: “What percentage of companies that have great ideas, excellent people, and a high-quality product or service effectively execute their strategy?” The answer they give me year after year is a mere 10–15%. This means that if you can successfully execute just 50% of your strategy, you will crush the competition. 6. Making the strategy too complex A major factor inhibiting the execution of a strategy is that they can often be convoluted and confusing. We all know the common refrain about strategic plans being “credenza wear.” You spend a couple of days and thousands of dollars at a retreat only to come back and stick the plan on the shelf, rarely looking at it until the next retreat. Excellent strategies are elegant. A few big ideas simply stated with a handful of metrics that will drive business results. If you don’t understand the strategy, you can’t implement it. I could probably list another dozen, but these are a few of the top issues I see where an organization puts together a strategy and strategic plan and falls short of meeting their goals. If you can avoid these six traps, I am confident you will create an impressive and executable strategy. John Spence is widely recognized as one of the top business and leadership experts in the world. He has been working in the credit union industry for more than 20 years and serves as one of the lead instructors for NAFCU’s Management and Leadership Institute. To find out more about John, go to www.johnspence.com.
RkJQdWJsaXNoZXIy Nzc3ODM=