Strategic thinking (as a part of strategic planning) is the first step in any business long-term plan. It’s the stage when the key players come together to discuss, brainstorm, and kick around new ideas and directions that can help a company look down the road to create new opportunities. Although many recommend looking three to five years into the future, I believe you need to identify a time frame most comfortable to you and/or your organization. Good strategic thinking will consider new ways to create value and will encourage new ways to think about a company’s value proposition. Simply put, strategic thinking is the process that you apply to be intentional and deliberate with the business development of your organization.
Every company can benefit from creative strategic thinking. It’s a matter of getting to the ‘why’ of a business, then encouraging the kinds of conversations that challenge conventional thinking about those ideas.
All of the following are essential for effective strategic thinking:
Strengths & Weaknesses: There has to be an honest, clear-headed, and objective assessment of a company’s strengths and weaknesses. How can they be honed into a unique competitive position? What can be done to encourage innovation and new perceptions? What do we consider our strengths? What do outsiders see as strengths of the company? How can these be used to create a unique competitive advantage? What do we see as our weaknesses? Which of the company’s weaknesses could be used as an opportunity by our competition? How can we turn our weaknesses into tactical advantages?
Products and Services: In terms of product, service, price, branding, and image, what does the company have to offer? Where do our products and services overlap or duplicate each other? What gaps do they leave? How can those gaps be addressed with marketing or innovation? What brands make up the overall company package, and are they consistent with the company’s image? Everything is up for discussion and sacred cows cannot be protected. Strategic thinking leaves no stone unturned.
Environment and Industry: What are the legal, regulatory, and accreditation requirements for the company? How will these determine the strategies under consideration? How does the economic climate affect the company? Where is the industry going? In what direction is the company headed? Where would we like to see the company fit in? How does the company collaborate or compete with others, and what exactly does that mean in the long run?
Markets and Customers: What is the profile of an ideal customer for our company? What companies or individuals fit that profile? What exactly do these ideal customers need, and how are we uniquely suited to meet those needs? How can we evolve to meet those needs as they might change? Do we also have internal customers that need to be identified and considered?
Competitors: Who are the competitors in our industry? Are there any new ones that need to be identified? What are their strengths and weaknesses? What will the economic climate do to our competition? Are there any companies that the company should consider for strategic alliances versus competition? Who are the key players within their organizations that the company should take notice?
Alliances: With which companies should we align resources? Who is their competition? What are their strengths and weaknesses? Are there ways to leverage such an alliance to make the end result more than a sum of the parts?
Process Considerations
Strategic thinking isn’t just what pops out of people’s heads in water-cooler or break room conversations (even though those ideas can certainly help). Strategic thinking is the intentional and deliberate process of reviewing the business for new ideas and business decision-making. It’s important for there to be a process behind the ideas.
Use the following to ensure that strategies are consistent with the company’s intention.
1.) The determined strategies agree with the organization’s mission and vision.
2.) The strategies set expectations to accomplish the determined goals for the organization.
3.) Strategic thinking is using real information to determine future plans. This process is only as logical and useful as the information being used for consideration.
4.) A company can’t afford to be narrow minded in its thinking. Be open to multiple alternatives and be flexible in making strategic choices to meet a range of scenarios. Have a ‘Plan B’ in the wings.
5.) Effective business strategy allows a company to determine its priorities and resources. There will always be new and different opportunities presenting themselves. Maintaining focus on effective strategy will provide the direction needed to the overall organization.
6.) Leaders know that in large, complex organizations a strategy must be a team effort. There needs to be consensus, with multiple points of view and open discussion so all involved feel they have a direct stake in what’s happening. Trust is imperative to strategic thinking!
7.) There has to be involvement from various levels of the organization. It is when everyone is on the same course that the organization can achieve the desired outcome in the manner identified through its mission and vision for its culture.
8.) Adaptable: Every strategy, every game plan needs to be adaptable. The market and the environment change, and a company must be able to read those changes and recalibrate strategy to fit a fluid situation. The business environment is littered with the wreckage of companies who couldn’t adapt and didn’t survive.
9.) The strategies identified must be implementable. Strategic thinking is not just an annual exercise. It is only productive when the thinking, planning, and discussions result in an actionable plan that can be implemented, observed, measured, and tweaked along the way.
Strategic thinking allows an organization to set a course, detour when necessary, but build momentum with intention. It is the company that takes the time and effort to strategically think for their organization’s well-being that will be in the race for the long haul.
~Thanks for reading!