Worse, actually choosing a strategy entails making decisions that explicitly cut off possibilities and options.
But almost all also find it scary, because it forces them to confront a future they can only guess at. Self-referential strategy frameworks.Įven managers who avoid the first two traps may end up using a framework that leads them to design a strategy entirely around what the company controls.Ī company can avoid those traps by focusing on customers, recognizing that strategy is about making bets, and articulating the logic behind strategic choices.Īll executives know that strategy is important. Planning can’t make revenue magically appear. But for revenue, customers are in charge. Cost-based thinking.Ĭosts lend themselves wonderfully to planning, because the company controls them. Planning arguably makes for more thorough budgets, but it must not be confused with strategy.
If you are entirely comfortable, you’re probably stuck in one or more of the following traps.
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But good strategy is not the product of endless research and modeling it’s the result of a simple process of thinking through how to hit a target and whether it’s realistic to try. It’s not surprising, then, that they try to make the task less daunting by preparing a comprehensive plan for how the company will achieve its goal. Strategy making forces executives to confront a future they can only guess at.