The 1 easy way businesses fail to develop a winning strategy
I have the good fortune to see a lot of business plans, and more often than not they are in the One Page Strategic Plan format. Some of these plans are in a draft format, where someone has attended a Gazelles workshop or read Scaling Up, and some are mature versions where the team have worked over many years to hone and refine the businesses strategy and plan.
Over time, patterns develop and one is able to see at a glance the difference between a strategy that is sound and a good degree of strategic thinking has gone into creating it, compared to one where people are simply trying to fill boxes. It seems to be human nature that people want to complete boxes trying to create a catchy tagline or slogan. I am going to call these bubble wrap plans.
Bubble wrap business plans
Entrepreneurs instinctively don’t like paperwork. It gets in the way of important stuff like creating new products and doing deals. Entrepreneurs cringe at the thought of writing a 25 page business plan for the bank, as it inherently seems a pointless exercise – in their mind they will just get it done! This is one reason the One Page Strategic Plan has been so successful, remove the unnecessary and focus on the why (we are doing it), how (we are doing it), and what (we are doing). However just because we are condensing the business planning process onto one page, it doesn’t mean that one can develop a winning business strategy simply by putting a few words into a box. It requires serious strategic thinking about each element of the plan, as well as how the components tie together.
When I see people complete a One Page Plan with a Brand Promise such as “Your Silver Service Bullet” it is completely meaningless and is written only to fill a box. In much the same way that bubble wrap is designed purely to fill a box these meaningless statements only serve to fill a box. Much like almost every single tagline, they are a waste of completely good ink.
The problem isn’t theirs alone, it comes from a world 60 years ago where a great advertising campaign could make a product fantastically successful. So many people still think, somehow that a snappy phrase under their business name will magically increase revenues.
But no more.
Since the heady days of the TV show MadMen times have changed. People question authority and instinctively don’t trust the claims made.
Last year, on average US companies spent 10.4% on marketing. Marketing products that could be better and that quite possibly people don’t want or need. Trying to convince us that their products are better than the others, when in fact they are probably just the same. What if only 20% of this, or 2% of revenue was spent trying to better meet the customers need, rather than telling people what they want?
I’m convinced that this is where bubble wrap business planning comes from. But even if it did work for some people 50 years ago it doesn’t work today. Today your business strategy must meet the customers need. You win by being better than the competitor at delivering on the customers need and then having them become advocates for your brand. People don’t care when they see your advert, they care when you meet their need. When you do a great job of it, they tell their friends.
Jigsaw puzzle business plans
A beautiful jigsaw puzzle has many complex parts and when they are joined everyone can both see the whole picture and there is no mistaking what the joined parts have become. There is meaning in both what is printed on the individual piece as well as how the edges interact with one another.
A brilliant business strategy is beautiful because it is a creative piece of work which is unique, all the elements come together and the more you read the more it makes sense. Also you can see a direct path to it’s execution and significant growth in both revenues and profit.
And thats really the key, the reason businesses succeed is not because they spent more on advertising or were lucky to hire better people and develop a better culture, they had a solid strategy that made sense across all the interdependent elements of strategic thinking and how it will meet the Core Customers need, along with how it will be consistently executed. That is the key to growth.