{"id":27271,"date":"2022-06-26T07:42:00","date_gmt":"2022-06-26T11:42:00","guid":{"rendered":"https:\/\/opexsociety.org\/?p=27271"},"modified":"2022-06-27T10:16:59","modified_gmt":"2022-06-27T14:16:59","slug":"getting-strategy-wrong-and-how-to-do-it-right-instead","status":"publish","type":"post","link":"https:\/\/opexsociety.org\/body-of-knowledge\/getting-strategy-wrong-and-how-to-do-it-right-instead\/","title":{"rendered":"Getting strategy wrong\u2014and how to do it right instead"},"content":{"rendered":"\n

Too many companies equate strategy with hitting financial goals. They underestimate the difficulty\u2014and the value\u2014of the real thing.<\/p><\/blockquote>\n\n\n\n

The word \u201cstrategy\u201d<\/strong> means an approach to dealing with a difficult challenge, especially that of competing with a clever opponent. To have a strategy is to have an approach to overcoming critical obstacles and difficulties. However, through many years of working with companies, government agencies, and the military, I have too often seen strategies that are actually a toxic mix of wishful thinking combined with a jumble of incoherent policies.<\/p>\n\n\n\n

In 2016, an S&P 500 company I\u2019ll call Royalfield gathered 25 of its senior executives in a hotel ballroom for what was billed as a strategy discussion. I was there to give a prelunch talk on strategy and had been invited to spend the day with the group and join them for dinner.<\/p>\n\n\n\n

The chief financial officer spoke first and showed clips from Marvel\u2019s Thor <\/em>movie to dramatize the financial report. A key point was that the company\u2019s debt burden was becoming a constraint, so investments had to be carefully controlled if return on equity was to be preserved.<\/p>\n\n\n\n

The chief executive officer spoke next, armed with PowerPoint slides presenting what he called the Strategic Commitment and the Success Score Card (SSC). He reminded the group that the strategic commitment grew out of a key acquisition made three years earlier and defined the newly expanded scope of the business. It comprised a description of the market being served and the admonition that the company\u2019s products would \u201cprovide its customers with the most effective solutions to their needs.\u201d It would also aim to \u201cprovide a high level of service\u201d for its products.<\/p>\n\n\n\n

The SSC for the whole of Royalfield was specified as a 15 percent annual growth in earnings and a 15 percent return on equity. These targets were somewhat higher than the company\u2019s recent financial record. The CEO ended with a quote from 19-year-old Katie Ledecky, who had won five Olympic gold medals in swimming: \u201cSet goals that, when you set them, you think they\u2019re impossible. But then every day, you can work toward them, and anything is possible.\u201d<\/p>\n\n\n\n

Click here to read full article…<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Too many companies equate strategy with hitting financial goals. They underestimate the difficulty\u2014and the value\u2014of the real thing. The word \u201cstrategy\u201d means an approach to dealing with a difficult challenge, especially that of competing with a clever opponent. To have a strategy is to have an approach to overcoming critical obstacles and difficulties. However, through many…<\/p>\n","protected":false},"author":1284,"featured_media":24063,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kad_blocks_custom_css":"","_kad_blocks_head_custom_js":"","_kad_blocks_body_custom_js":"","_kad_blocks_footer_custom_js":"","_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"","_kad_post_sidebar_id":"","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"footnotes":""},"categories":[336,624],"tags":[1005,1008],"class_list":["post-27271","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-body-of-knowledge","category-thought-food","tag-business-transformation","tag-strategy"],"taxonomy_info":{"category":[{"value":336,"label":"Body of Knowledge"},{"value":624,"label":"Thought Food"}],"post_tag":[{"value":1005,"label":"Business Transformation"},{"value":1008,"label":"Strategy"}]},"featured_image_src_large":["https:\/\/opexsociety.org\/wp-content\/uploads\/2021\/04\/McKinseyLogo1.jpg",768,432,false],"author_info":{"display_name":"McKinsey & Company","author_link":"https:\/\/opexsociety.org\/author\/mckinsey-and-company\/"},"comment_info":0,"category_info":[{"term_id":336,"name":"Body of Knowledge","slug":"body-of-knowledge","term_group":0,"term_taxonomy_id":336,"taxonomy":"category","description":"The collected Body Of Knowledge<\/strong><\/em> of the Operational Excellence Society.","parent":0,"count":1243,"filter":"raw","term_order":"0","order":"0","cat_ID":336,"category_count":1243,"category_description":"The collected Body Of Knowledge<\/strong><\/em> of the Operational Excellence Society.","cat_name":"Body of Knowledge","category_nicename":"body-of-knowledge","category_parent":0},{"term_id":624,"name":"Thought Food","slug":"thought-food","term_group":0,"term_taxonomy_id":624,"taxonomy":"category","description":"Curated articles from various sources.","parent":0,"count":746,"filter":"raw","term_order":"0","order":"0","cat_ID":624,"category_count":746,"category_description":"Curated articles from various sources.","cat_name":"Thought Food","category_nicename":"thought-food","category_parent":0}],"tag_info":[{"term_id":1005,"name":"Business Transformation","slug":"business-transformation","term_group":0,"term_taxonomy_id":1005,"taxonomy":"post_tag","description":"In\u00a0management\u00a0it has been said that\u00a0business transformation<\/b>\u00a0involves making fundamental changes in how\u00a0business\u00a0is conducted in order to help cope with shifts in\u00a0market environment. <\/sup>\u00a0However this is a relatively narrow definition that overlooks other reasons and ignores other rationales.","parent":0,"count":7,"filter":"raw","term_order":"0","order":"0"},{"term_id":1008,"name":"Strategy","slug":"strategy","term_group":0,"term_taxonomy_id":1008,"taxonomy":"post_tag","description":"Strategy is a general plan to achieve one or more long-term or overall goals under conditions of uncertainty.","parent":0,"count":10,"filter":"raw","term_order":"0","order":"0"}],"_links":{"self":[{"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/posts\/27271","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/users\/1284"}],"replies":[{"embeddable":true,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/comments?post=27271"}],"version-history":[{"count":2,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/posts\/27271\/revisions"}],"predecessor-version":[{"id":27294,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/posts\/27271\/revisions\/27294"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/media\/24063"}],"wp:attachment":[{"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/media?parent=27271"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/categories?post=27271"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/opexsociety.org\/wp-json\/wp\/v2\/tags?post=27271"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}