Faust: Four Questions Focus Your Business Strategy
As consultants who have worked intimately with hundreds of companies, we're amazed how often we've had to come back to basic questions because they were never adequately answered. There are a handful of these deceptively simple questions the majority of businesses could do a better job of asking, discussing and answering. As a result, they would be more effective and focused. We refer to them as the Core Strategy Focus Questions.
Any manager can use Core Strategy Focus Questions to sharpen a business' focus and make advancements in strategy, positioning and focus. Regardless of your role, consider the questions detailed below and think about the opportunities for improvements or increased clarity.
We have found many intelligent managers avoid asking basic questions for fear of coming off as unaware or unprepared. If that's the case, reframe the question with just the right nuance.
For example, asking, "What business are we really in?" might get the unhelpful answer, "The X industry." You may need to say, "How do you think we can best phrase what business we are really in? In other words, what do we ultimately deliver to our customer, and what does the customer most value? When asked what business we are really in, what answer differentiates us from competition?"
Yes, it's a mouthful, but it's how it might need to come out to really get someone to think about all the nuances.
These questions help to define the theory of the business, and having a theory about the business is part of the science of management and strategy.
In fact, we've used that reframed question many times. It has led to some brilliant strategy dialogues and, in turn, innovations in marketing, positioning, selling and more.
Core Strategy Focus Questions:
1. Mission Focus-What business are we really in? Do we have just one business, or do separate businesses demand a unique strategy? Many organizations have more than one business. Whether or not these are distinct units with separate P&Ls, different businesses in an organization have unique primary sources of leverage, and strategies that may or may not overlap. In most situations, it is best to break out the separate businesses and discern the strategy, objectives and role focus for each. What is the purpose of the business? How is this business different from the competition, if at all?
2. Customer Focus-Who is our ideal primary customer? Who are the most profitable customers? Who are easiest to win, most abundant and not in a "red ocean" (a highly competitive market)? What does the customer value?
3. Results Focus-What results do we deliver to our customers?
4. Priorities Focus-What must we improve, or do, to achieve our vision? What should we stop doing?
Mark Faust is a business consultant and author. This column is an excerpt from his book, High-Growth Levers, which is available at www.barnesandnoble.com and www.smile.amazon.com. Rob Vickery also contributed to that book and this column. Vickery focuses on marketing, business development, product development and operations for Echelon Management's office in San Diego, Calif.