Someone recently asked me the question, “What is [business] strategy?” Given that I call myself a “business strategy consultant,” I was disappointed to find myself fumbling around for an answer. I only managed to cobble together some vague metaphors involving “horizons” and “guiding lights.”
So what is strategy?
I should have a much clearer and more concise answer to this question, if for no other reason than to keep a better response at the ready for dinner parties when inevitably someone wants to know, “What do you do?”
When Porter came up with the Five Forces, strategy described at a high level how your company contended with these forces and beat the competition in the war for profits. The martial language is both intentional and appropriate since the concept of strategy originated in military theory.
But Porter’s Monitor Group is now defunct, acquired by Deloitte under duress. In an age when the pace of change from technological advancement is ever increasing, no competitive advantage is truly sustainable, and customers are better informed than ever about their available options. Simply aspiring to beat the competition will not suffice.
Firms need a more meaningful reason for being. Call it a mission, vision or something else, they need something with which both their customers and their employees can identify. That’s where strategy for the new era needs to begin – with the impact your company is trying to have on the world, above and beyond beating your competition.
Nonetheless, the Miltonian mandate to make money must also be heeded. Strategy doesn’t stop with impact alone (outside of the social sector). Rather, good strategy also identifies valuable problems to be solved and customers to be served who are willing to pay for that value.
Of course, competitors cannot be disregarded entirely in all this, but it makes no more sense to let your competitors drive your strategy than it does to drive your car looking in your rear view mirrors. You might glance in the rear view from time-to-time, but your gaze generally remains out front on the road ahead of you.
Shifting the focus away from competitors and over to impact and customers and their problems actually leads to a more robust and responsive strategy. Firms can better anticipate threats from disruptive new entrants and are more likely to recognize attractive opportunities in market adjacencies.
As I’ve considered my answer to the question, “what is strategy,” my conclusions have become more consequential than merely offering a new definition. The time has come to replace the notion of business strategy entirely. Music seems a more fitting analogy now than does war.
Imagine if we changed the conversation to be instead about winning business harmonies; rather than tactics, we discussed melodies; and in place of command and control hierarchies and processes, we empowered employees to improvise like jazz musicians.
What is business harmony then? The broad targeting of people (consumers) and problems in the market that in turn guides organizational decision making, coordinates disparate activities, and ensures a consonant impact from a collective effort.
Just call me a business harmony consultant.