Why Most Businesses Have No Strategy

All businesses have a brand.

All have a product.

All have people, sales, marketing, and various other building blocks which add up to “a company”.

But not all – in fact very few – have a strategy.

I don’t mean to say here that most businesses have bad strategies (though quite a lot do).  I mean, quite literally, that most businesses have no strategy.  They simply have a void, a vacuum, where one would normally be.

Needless to say vanishingly few of these would admit to having no strategy.  I guess everyone thinks they have one.  But the evidence to the contrary is overwhelming, and easy to find.  Simply ask them whether the business in question has a clear and focused direction, which carves out unique market space, and which everyone in senior management can eloquently and consistently explain on demand.

If you don’t have that – and almost nobody does – then you have no strategy.  Or at least, not a conscious one.

This has always struck me as very weird.  After all, not many people dispute the value of strategy, and pretty much all of them pay it lip service, so you’d think it would be pretty commonplace.  But clearly it’s not.

A lot of this of course comes down to the well documented confusion surrounding the term.  The majority of people – even a sizeable chunk of CEOs – don’t really know what a strategy is.  Hence the stubborn persistence of strategies like:

“To go international”
“To double in size”
“To be number one”

…and so on.

This is pretty well-worn territory, so I won’t go on about it too much here.  Instead I want to mention another more subtle and perhaps more common reason that strategy is forgotten.

It’s summed up by this quote from a mentor of mine:

“When a business isn’t working, they always try to fix things with either sales or marketing, even though their problem is strategic”.

What’s he saying here?

Well, as we’ve discussed before, strategies alone don’t actually do anything.  It is only execution of the strategy that matters.  A strategy without execution is like a conductor without an orchestra – some idiot gesticulating into the ether with no meaningful results.  What the conductor needs, like the strategist, is tools of implementation – whether they be violins and oboes; or in the case of a business, brand, product, marketing, sales, and so on.

Now because it is the tangible executional factors that do the heavy lifting, it is they that get the credit for the result.  It is they that get the attention:

  • We credit brand for Nike’s success
  • We credit logistics for Amazon’s success
  • We credit R&D and patents for Pfizer’s success
  • We credit design for Apple’s success

Consequently, companies tend to jump to execution when they have a problem.  They jump to solution.  They know that execution solves problems, so they are doing something apparently logical.

But what they miss is that behind every amazing execution, just like every great symphony, is a strategy guiding the way.

Although this isn’t always the case (and I want to stress that), it’s fair to say as a general rule that if you think you have a marketing problem, you actually have a strategy problem.  If you have a sales problem, you actually have a strategy problem.  If you have basically any kind of problem which pertains to the company’s performance in the market, then you have a strategy problem.

All those things in your business you think aren’t working probably aren’t dysfunctional because they’re poorly implemented.  They’re dysfunctional because they lack coherent and effective direction.  It might be true that, say, a new brand is going to solve all your problems.  However it will only be able to do that if a guiding strategy precedes it – not a “brand strategy”, but a macro market strategy.

Understanding this, it’s very clear why strategy is forgotten:

  1. Because it’s invisible in comparison to its executional manifestations
  2. Because it means that all problems need two solutions, rather than one (a strategy first, and then an execution – and that’s quite a lot to bite off)

It takes patience, guts, and foresight to invest time and money into a process which, technically, will amount to nothing more than words on a page when it’s complete – a few words which you may never do anything with.  It’s far more satisfying to do something “real” where no matter what happens you’ll have something to show for it.  To whip out the violin and bash out a few chords.

And who knows, maybe like the monkey’s and their typewriters something incredible will emerge.  But more likely will be just noise.  Because it’s not the notes that make music, but the space between them, and their relationship with each other – the stuff you can’t hear – that counts.

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