strategic hierarchy

The Customer-Facing Reality For Any Business

As we all know, strategy is confusing.

If I tell people that I’m a strategist, they typically respond in a similar manner as if I told them I’m a pixie – a mixture of bafflement and scepticism. “I don’t really know what you mean, but it sounds like bullshit anyway”.

This, frankly, is fair enough.  It is a bit of a nonsense word, which is used in a vastly broad variety of contexts, often completely erroneously.

It is for this reason that most businesses simply don’t do strategy, at least not knowingly. Equally, it is for this reason that there isn’t really an established strategy industry.  A friend of mine, a very senior strategist within a number of organisations, once sent me a market map of supposed “strategy agencies”.  What was remarkable about it was that it was divided into four quadrants: research agencies, branding agencies, innovation agencies, and the big consulting firms like McKinsey.  Note that none of these categories are pure strategy.  Their work all overlaps with strategy, but none of them specialise in the thing itself.  This is because nobody’s really clear on what strategy is, so nobody shops for it, and thus it’s very hard to sell (I should know!).  Thus almost all “strategy companies” become forced to root themselves in an understood discipline like branding or research.  This gives them access to a market, and thus an entry pointthrough which to practice strategy, or something vaguely like it.

Quite interesting I think – and probably the main reason why I have not yet met anyone else who does precisely what I do, at least not in the same capacity.

At any rate, all this is a shame, because the absence of strategy is what leads pretty much all businesses to being somewhat muddled and directionless.  I dare say if you were to undertake an analysis of the most common problems afflicting brands across all industries, number one would be something like “lack of focus” or “messiness” of some description.

This messiness in turn is what I think makes business difficult.  It can feel like a tangled knot; a confusing headache, and cause of sleepless nights.

Here I want to outline a very basic idea that can go a long way to solving that – even without needing to get a clear handle on strategy: the strategic hierarchy.  It’s something I’ve mentioned in passing a couple of times recently, but have never dug into, so let’s do the here.

The strategic hierarchy presents three elements that, when taken together as a unit, represent the entirety of any business’ customer-facing reality.  The best advice for brands that I can offer is simply to address each one, in turn, ensure they align with each other, and you will be operating under a far greater degree of clarity than pretty much any other brand.

They are:

1 – Value proposition
The value you deliver to the market

2 – Delivery
The way you deliver that value

3 – Branding
The way you communicate that value

As you can see it’s embarrassingly basic, and yet also pretty complete. You can probably also see how in spite of its basicness, it’s not something many people really have a handle on; preferring instead to overcomplicate things.

For one thing, most businesses never manage to nail down a strong value proposition.  I won’t dig into this at all here, because we’ve discussed it in many different ways before, but sufficed to say this is the thing your customers are paying for.  The thing you are doing which people are prepared to exchange for cash.  It can come in a great many different “flavours”, from raw functionality to complex social signalling, but it needs to exist if you want to get paid – and ideally you need to have a strong grasp of it.  All successful businesses have one (they wound’t be successful without it) – but not many have it clearly defined or understood.

Without this first element, the model is useless, since the other two are wholly dependent on it.

Delivery is naturally how you give people that value you promise.  The actual practical elements of your product or service which make it happen.  It goes without saying that you should put a huge amount of energy into maximising this, because it’s the whole point of your operation, and where you create meaningful differentiation.

And then finally brand (by which I simply mean “presentation”, because strictly speaking these three things together add up to your true brand) is how you communicate that value.  How you let people know, in an eye catching manner, what it is you actually do.

This last one I’ve found often catches people off guard.  It’s a far more simplistic description of branding than they’re used to, but if we’re honest, it’s really all there is to it.  Your business does something of value, and you need to tell people about it in a way they care about and understand.  If they’re into it, then they’ll pay you for it.  Not rocket science right?

Although there is a huge amount of complexity buried in each one of these elements, that complexity isn’t necessarily what most brands have an issue with.  Instead they have an issue with the high level ordering of these complexities (seeing the wood for the trees) – and that is what the strategic hierarchy is designed to address.

The value you deliver, the way you deliver it, the way you communicate it.  This is the scaffolding on which your businesses – every business – hangs. The strategic hierarchy.

Think like that, and it all becomes way easier.