Often, an executive team will create a great strategy, only to find that their strategy has created more problems than it’ resolved. Instead of catapulting a company to new heights of success, the strategy causes the company to get mired down in a cascade of new, unforeseen challenges. Sometimes a misguided strategy can even cause a decline in growth and profitability. Often, the cause of these additional problems is that the underlying strategy was developed to address a symptom rather than the underlying problem. Consider this scenario…
A company’s sales are sluggish and the president wants to take steps to address the problem. So he calls an off-site strategic planning session with all his top executives in attendance.
After reviewing the company’s performance over the past three years, they strategize about ways to drive revenues. They discuss new pricing models, expanding their sales force, and entering new markets. They examine the levels of activity of their sales team along with ways to leverage social media to build brand awareness.
Then, a plan of attack is developed. The plan lays out specific actions to be taken, provides a timeline for implementation, and details who is accountable for what. All-in-all, they develop a comprehensive plan which should address the problem of lagging sales.
But the reality is that poor sales were a symptom of some other issue and not the real problem!
The consequence is that these strategies – although well-intentioned – will undoubtedly fall short of their mark. Had they dug deeper and asked the right questions, they would have discovered that sales were slipping because 1) their products were out-dated and needed an overhaul, and 2) they were having quality issues which resulted in customers looking elsewhere for the ongoing needs.
Had they arrived at the real problems, the strategy would have been something like, “Our strategy is to develop new products which meet the current expectations of our customers and to improve the quality of our products to be more reliable.”
Because they had not uncovered the real issues, they had developed strategies which ironically would have shown the market more quickly just how poor and out-dated their offerings were, which in turn, would ultimately have driven sales even lower.
The key to uncovering the real problem(s) is to continue to ask “why” until the problem reveals itself. Often, the means to get to the root issues is to solicit input from the front line people in the organization – the field sales force or customer service force. They are some of the best informed about the problems customers are having (or at least the additional symptoms which will point to the real problem). Of course, asking customers directly can be extremely enlightening and revealing.
By asking “why” enough times, the underlying problem will reveal itself. Generally, once the problem is identified, the right strategy becomes self-evident.
The key to developing an effective strategy is to gain clarity as to what the true underlying problem is and only then creating a strategy to address it. A strategy which address a symptom always creates more issues.