The 5 Core Pillars of strategy

Over the last week we’ve talked about the 5 Core Pillars of strategy and where you sit currently in each one. In this article I will deep dive into each and list all the vital Questions you MUST ask yourself around the 5 Core Areas of Strategy, if you want to scale. These 5 Core Pillars are Finance Operations Marketing Sales Human Resources

Finance:

Let’s use Finance as another example as it is one of the Five Core Strategies for every business. Again, you may well have identified some key action points in this area from your S.W.O.T. Analysis. So, what is it that you need to achieve? Is your focus to sell off the company, or part of the company? Are you looking to make an exit? You might have a particular figure for the value of the business in mind, say three million in five years’ time driven through a series of small acquisitions and building on organic growth. That’s a financial strategy.

To achieve it might require putting in cash reserves through the business. Cash reserves may be key to you raising capital for the next element of the business. It might be putting in a robust financial system if you are currently not getting what you want. Or putting in a management information system so you’re actually extracting data you need to make decisions.

It could be hiring the next financial person, it could be getting a bookkeeper, it could be changing your accountant, it could be getting in a financial director or a financial controller.

There are many different strategies around finance, but that doesn’t mean it needs to be complicated.

All you are looking to do is to bridge between where you are now and where you need to be and what needs to happen to make that so. That will be your strategy for finance.

Operations

Now, obviously Operations and what it encompasses means different things in different industries. If you are in manufacturing, then your strategy in this area might be focused on driving efficiencies through the business, or investing in new processes or new technology.

If you are in more of a service based industry, it could be based around ways that your Customer Relationship Management (CRM) systems help to increase the lifetime value of a customer, or are able to deliver companion products or services to add on to what they traditionally buy from you. It might mean increasing the resources to offer a more personal service to your customers.

So in your world, Operations might not be one of the Five Core Strategies. You might want to call it Service, for example. Again, this does not need to be complicated. Where are you now with this, and where do you need to be? What will it take to bridge that gap? That will be your strategy.

Marketing

If the way you are currently marketing your business is the same as it was 12 months ago then, even if you haven’t changed, the world has changed around you, and so have your customers. There is no one area that is more susceptible to change than the whole area of Marketing.

It may well be that you have just woken up to the world of social media and AI and you need to find a seven- year-old to explain it to you. Certainly there is much happening in that space and some businesses have gained much by positioning themselves there.

Are you looking at rebranding and, if so, was this an emotional decision or one based on an in-depth look at how you are positioned and perceived in your marketplace?

Do you need some reliable data on which to base decisions as to which direction to take your marketing? Do you need to draw on some expert analysis? Are you measuring the results generated by your online presence? Do you know what the trends are? Do you know how to influence them? Marketing can be a complex subject if you let it. Fortunately, as the leader of your business, you don’t need to be an expert. All you need to be able to do is to ask the right questions, and then act on the answers.

As long as you track and measure everything, you will quickly know what works and what doesn’t. You will know what the trends are and what needs to be addressed. You can then make the right things happen.

As there may be a number of different strands to your marketing, there is no reason why you cannot have additional sheets on this to support your main Strategy on a Page, but keep that page as simple as you can.

Ask yourself, where are you now? Where do you need to be? What will it take to bridge that gap? Keep it simple! But pow-erful

Sales

In my experience, there is often very little wrong with a business that a few extra customers couldn’t put right. Yet so many businesses think of sales as a reactive, rather than a proactive function. It is one thing to make a sale when someone walks in the door, but another one entirely to get them to walk through the door (or virtual door) in the first place.

Having a Sales pipeline, a Sales funnel and knowing your conversion ratios from suspect to prospect to customer is the only way you will be able to be in charge of this vital element of your business.

What do you need to do to positively influence sales? Do you need to hire and train a new sales person? Do you have a robust process in place to evaluate potential employees and ensure they have all the appropriate skills, values and qualities you need? How will you be measuring what they do? Do you have a way of seeing the relationship between calls, contacts, appointments, presentations and sales? Can you extract from those ratios where a sales person’s strengths and weaknesses are? How good is your organisation at managing the sales process?

Are you where you need to be, or do you need to make changes? What is it going to take in the next month to make a difference? How will you know if you have?

Human Resources

Looking at the big picture of which direction you want to move your business towards, what are the implications for your people, your contractors, your freelancers, your employees, associates or partners? Are you involved in succession planning? Do you need to put in place new people to take over the aspects of the business you are currently doing yourself? Have you grown to a point that you now need an HR department to take some of that administrative burden off you or others?

Are your HR systems delivering to the needs of the business? Do you need to outsource your HR function?

Look at where you are now, and where you need to be. What needs to happen? Add it to your Strategy on a Page.

…………… Now it’s time to take stock

Well, you have come a long way this month looking into this chapter of my “Strategy on a Page book”. If you have been doing all the exercises and writing down the insights and the learning points you have had, you should be a lot clearer on what your Strategy on a Page is starting to look like.

If you have been cheating and reading ahead and not doing your homework, then all you will have are a few superficial ideas and little more. This book is all about learning through doing. So, no cheating please!

You have looked in depth at purpose, vision and values; your unique selling proposition; the market space you operate in; and the promise you give your customers. It is knowledge based on those core fundamentals in your business that will allow you to drive the strategy necessary to move you forward to the next level.

You should now have identified the five elements of strategy appropriate to your business and will have mapped out where you need to be in the Long Term and what you need to be doing this month to ensure that happens.

Once you have your five core strategies in the month, quarter and in the year, you should now identify what the top one is. There’s usually one strategy which is most important of all and the one that’s usually not being done. It could be within your Critical Strategy or your weak area. Identify it and focus on it.

S.W.O.T.

You’ve also done an exercise off the page, to help you gain clarity on your Strengths, Weaknesses, Opportunities and Threats, and what you can learn from this and apply it to your strategy moving forward.

You will have seen the strategies for opportunity and threat, and you now understand how to map that back into the business. So you are making the bridge.

Remember, strategy is the bridge between the big picture of where you want to be and where you are now. It provides the framework to move towards those objectives step-by-step every single month, piece by piece, and by doing so, ensures that the major core strategies for the business are achieved.

But you are not quite there yet. You will have noticed that there are 3? boxes that are still empty. Your Business Growth Indicators. These are the Tools you will use to effectively measure the strategy and your progress.

?It’s all very well saying you’re going to do something, but how do you know it has actually been done, and how do you measure the success over time? These are business growth indicators, and that’s the next chapter released over the weekend. Following that, you go into the all panel full accountability section, and this is where the magic starts to happen. It’s all very well spending all this time on strategy but if you don’t actually do it and if you don’t hold yourself accountable, all of this will be wasted.

Tomorrow I will share a Case Study: Getting Clarity on your Core Purpose

Till then