Tuesday, October 9, 2012

Strategic Clarity

Reaching $10 billion in revenue is a goal, not a strategy.   

A strategy is a plan for succeeding in the market.  It is fundamentally about how.  A surprising number of companies think they have a strategy when, in fact, they only have financial goals.  Reaching $10 billion in revenue is a goal, not a strategy.   

Breaking down the $10 billion into specific divisions, regions, customer types, or product categories is just a finer dissection of the goal; it is still not a strategy.  Adding probability bans, performing sensitivity analysis, or doing complex "what if" scenarios is simply further manipulation of numeric goals.  These spreadsheet exercises are not strategy because they don't show how you will reach the excruciatingly precise numbers.

ACTION POINT: Don't confuse financial or numeric goals with strategy.

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