When preparing for the year ahead you start to think about the goals you want to achieve next year. Before you do that, instead, think about your strategic destination and align your annual goals to this further-reaching position you want to get your business to.
If you have defined a strategic destination, review it and check that it is still valid. If you don’t have one then now’s the time (before you set your annual goals) to create it.
A strategic destination is a clearly defined destination for you to aim your business at. Ideally it would take your business to the next level. It should be a massive milestone that gets your business a big step closer to your ultimate vision.
It’s important that you define an overall vision – an aspiration of where you ultimately want to get your business. But, as most visions are 10 years or more away, you cannot reach it in a single strategy.
Your strategic destination breaks this vision into major milestones and your strategy should be created to meet this destination.
Think of your strategic destination as the basecamp and intermediate camps that you aim for, rest and acclimatise at, on the way to reaching the top of a mountain. They are clear milestones that you need to reach.
Your strategic destination could be 2, 3 or more years ahead and it gets your business to a natural plateau.
Create a Clear Strategy Statement
Your Strategic Destination is written in the form of a Strategy Statement that details how you will reach this destination, within what time frames, with what products and services and who your target customers will be.
It creates a more concrete destination than a vision does and fills a too-large-a-gap between your vision and mission and the goals you set. It is a simple statement that communicates what your overall strategy is.
Your strategy statement is vital because not only will it help you stay focused and on course, it will help your people understand exactly where they’re going, how they fit into the overall direction of the company and the difference they make to the success of the business.
A strategy statement should be a statement that is unique to your organisation and which differentiates it from others. It will also help you and your people with the strategic, and often difficult, choices you and they have to make.
In their Harvard Business Review Article, “Can You Say What Your Strategy Is?” David Collins and Michael Rukstad state that, “Most executives cannot articulate the objective, scope, and advantage of their business in a simple statement. If they can’t, neither can anyone else.” They go on to say, “Companies that don’t have a simple and clear statement of strategy are likely to fall into the sorry category of those that have failed to execute their strategy, or worse, those that never even had one.”
A good strategy statement provides clarity and should cover the objective of the organisation, include boundaries of expectations such as results and time and communicate an advantage.
The key elements to a strategy statement can be broken down into the following:
- Action – what is it you’re going to do?
- Result – what will be the result of your action?
- Timeframe – over what period will you achieve this?
- Method – how will you do this?
- Product or service – what is your offering?
- Customer – who are your targeted customers?
- Means – through what means will you achieve this?
A single strategic destination and strategy statement describes a more specific vision and mission in one step. For example, one of my clients owns 2 care homes, which she wants to expand to 10. That is her vision. Her strategy statement is a major milestone to reaching that vision.
___ will expand to 5 care homes, each of which will be one of the top 3 care homes in its geographical region (what she will achieve) by 2017 (time period) by offering the best quality residential care (what she’s offering) to people over 55 with acute mental health problems (specific customer base) through evidence and research based care and a culture that focuses on wellbeing as well as clinical care (how she will do it).
Take out the text in brackets and there’s her strategy statement.
Strategy statements provide clarity.
Collins and Rukstad poetically use the analogy of employees being like iron filings. Pass a magnet over the iron filings and they all line up. The strategy statement is the magnet and with it the people are aligned in the same direction and have a clearer understanding of their role how it fits. “It allows everyone in the organisation to make individual choices that reinforce one another.”
Once you have your strategic destination defined then, aligned with a set of strategic priorities, you can break it down into your annual goals. Now, your annual goals will align with a clear and further-reaching destination.
Most organisations lack a strategy statement and come unstuck when trying to connect their high-level purpose, vision, mission and values (assuming they even have them) and what they will do to realise them, because the gap is too wide. The strategy statement, and the strategic priorities, bridge that gap.
Setting this strategic destination is a vital part of the preparation you should be making now to make next year the best year possible. It is also a key part of making your business stronger and falls under having Strength of Purpose. Strength of Purpose is 1 of 4 levels of strength. All 4 are needed to give you the best chance of meeting your goals and reaching your strategic destination.
Download the eBook “How Strong Is Your Business?” to understand all 4 levels and establish them in your business.
Photo credit: ilkerender on Flickr