STRATEGIC MANAGEMNET

BMT6118
DIGITAL ASSIGNMENT I

SUSHMA D
19MBA0054
QUESTION
Explain the term "Strategy". What are "Strategic Elements"? Explain their meaning
along with examples

Strategy (from Greek στρατηγία stratēgia, "art of troop leader; office of general, command,
generalship") is a high level plan to achieve one or more goals under conditions of uncertainty.
A strategy describes how the ends (goals) will be achieved by the means (resources).

“Strategy is the direction and scope of an organization over the long-term. It helps achieve an
advantage for the organization through its configuration of resources within a challenging
environment, to meet the needs of markets and fulfill stakeholder expectations.”

STRATEGIC ELEMENTS AND THEIR MEANING WITH EXAMPLE:

There are 5 key elements of a strategic plan that must be included to ensure you've got a great
strategy. These include:

 Vision
 Values
 Clearly Defined Outcomes
 Accountability
 KPIs

1. VISION

No surprises here - we need to start off by defining our vision for the organization (the
destination). We've written extensively about how to write the perfect vision statement, so do
check out that post for more detail. We can't emphasize enough how critical a vision is for your
organization. Your vision will help you to:

Bring alignment to your organization. People will unify their efforts towards a common goal,
driving increased efficiency.
Create goals which are cohesive and focused. Inspire employees, investors and other
stakeholders to invest in your business both emotionally and commercially.

Creating a vision statement is the obvious starting point for defining your overall vision. But
you may also want to consider creating a mission statement too. A mission statement differs
from a vision statement - A vision statement defines where you want to be in the future. A
mission statement defines broadly how you will get there.

Many organizations are moving away from separate vision and mission statements, due to the
confusion that often surrounds their differences. Instead, you might want to try converting your
mission statement into a series of focus areas. For example, Patagonia's vision statement is:

"To share our love for the outdoors and create a diverse range of products for all facets of
outdoor life" and their focus areas are:

"Best product"

"Reduce environmental harm"

"Encourage discussion on the environmental crisis”

Their focus areas essentially describe how they will achieve their vision, and also act as the
bedrock for the majority of their strategic goals and KPIs.

2. VALUES

Values really don't get the credit they deserve! People often see them as a throw-away and
vacuous - more aimed at marketing the organization than guiding its true internal behaviours.
But a well-crafted set of values can be the difference between success and failure in your
strategic plan. Check out this blog post for more detail, but in summary, core values help you
to:

Make better decisions by helping you to rule out courses of action that are not appropriate for
your company.

The values that should go into your strategic plan are not the usual sickly-sweet values you'll
see in corporate marketing videos aimed at customers. Instead they need to be a frank self-
assessment of how you want your organization to behave as it goes about delivering against its
vision and mission / focus areas. They should ideally reflect the values of your very best people,
and the values that have helped you to succeed the most in your journey to date.

Identifying your core values is s critical component towards defining your starting point and
your journey.

3. CLEARLY DEFINED OUTCOME

A strategic plan is nothing without a set of clearly defined outcomes. Visions, missions and
focus areas are a great starting point - but no-one will take your plan seriously unless you can
clearly articulate what steps you are going to take to get there - and what success looks like for
each of those steps.

Not all of your outcomes will be immediately quantifiable - and that's ok (your KPIs below
will help you in those cases). But when you define your outcomes, they ought to look something
like this:

Action + Detail + Metric + Unit + Deadline

For example:

Expand our international operations into 3 new markets by 21st December 2018.

Starting with a verb forces you to be specific about what you’re trying to do. If you can include
a metric and a unit – do so. It will help keep you focused and honest when it comes to tracking
your progress. Having a deadline works in much the same way.

4. ACCOUNTABILITY

This is such a small detail, but it is also one of the key elements of a strategic plan that so many
organizations fail to implement. A lack of accountability will absolutely destroy your strategy
execution. Lacking or confusing accountability results in:

Outcomes not being delivered because no-one knew who was in charge

Conflicting interpretations of what the business should be working on

Increased 'finger pointing' and hearsay when things don't go to plan

No-one taking any satisfaction or pride in the outcomes delivered by their team

You need to define your accountability in your initial strategic plan as a part of defining your
journey. Ideally, the people responsible for a particular segment of your plan should also have
been critical contributors to the plan itself. That's the best way to drive engagement and to self-
enforce accountability.

This also shouldn't be a difficult process. For each of your outcomes from step 3 above, simply
state one single person who will have primary accountability for that outcome. Try to avoid
defining yourself as the accountable person for every single outcome. It's fine for that person
to invite other people in to work on the outcome with them (either by cascading the goal or
inviting collaborators), but it needs to be clear that the primary accountability sits with the one
individual initially assigned to the outcome.

5. KPI s

Creating KPIs is probably the hardest of all the key elements of a strategic plan. But without
KPIs, you won't know until it's too late about whether or not you're succeeding as you head
towards your vision. Note that KPIs are different to the metrics that you set as part of creating
your outcomes from step 3. Rather, KPIs should relate to how well you're delivering against
the components of your mission or focus areas. Let's take a look at some examples:

One of Patagonia's focus areas was 'Best product'. A KPI for this focus area could be their Net
Promoter Score - i.e. how many customers would recommend Patagonia's products and
services to others.

For their 'Reduce Environmental Harm' focus area they might have a KPI for maintaining their
carbon footprint at 0 (i.e. being carbon neutral) And finally for their 'Encourage discussion on
the environmental crisis' focus area (probably the hardest to set an effective KPI for), they
might measure something like the number of mentions of the company on social media that
also reference the environmental crisis. Don't let setting KPIs become harder than it needs to
be, we've created an easy 4 step formula for creating great KPIs. You need to ensure that your
KPIs accurately reflect what success actually looks like for that focus area. You'll also need to
be able to accurately measure the KPI on a regular basis. Selecting the right KPIs is therefore
one of the key elements of a strategic plan.