We’re joined by Kevin Garton, Chief Operating Officer of Context Capital Partners a leading alternative investment specialist firm.
Kevin has taken a very circuitous route to where he is now. He’s worked in organizations of every size, from Fortune 500 companies to small startups. And he’s hung his hat across a variety of industries, from consumer products, internet media, financial services to enterprise software.
And along this journey, Kevin learned that the heart of a strategy is making choices that enable you to be competitive or have a competitive advantage in the market that you decide to operate in – regardless of your organization’s size or what industry you’re in.
So over the past year, he’s used his expertise to help Context Capital Partners redefine their business strategy – and put the right people in the right roles to make this new strategy happen.
Kevin walks us through what it takes to develop a sound business strategy – and, just as important, the misconceptions many people have around what a strategy actually is.
The idea of creating a strategy may sound simple, even obvious, but as you’ll learn in this episode, the choices you have to make almost never are.
What is a Strategy - The Myths, Misconceptions, and Challenges
The heart of a strategy, Kevin says, is really about making choices that enable you to be competitive or have a competitive advantage in the market that you decide to operate in.
But there are myths and misconceptions on what a sound strategy entails:
Strategy = Vision or mission
Mission and vision are important part but really provide the direction and don’t provide the details that you need to encompass a complete strategy. This is an extremely common mistake.
Strategy = Best practices
They can be part of the strategy, but they are not the strategy itself.
Strategy = Plan
The plan is really the set of tactics that you use to implement that strategy
Another big challenge for many organizations is that there's nobody in the company is specifically responsible for creating, communicating, and implementing the strategy – and every organization needs a Kevin!
“Making those choices is hard. And what happens, I think, in a lot of environments, is it's inherently easier to focus on plans and tactics.” But when you make the right choices, they free you to focus on the things that really matter.
Developing a Sound Strategy is a Marathon not a Sprint
The process of creating a strategy starts with research and analysis, and that can go on for months – and it should go on for months!
You need ensure your data reflects a comprehensive viewpoint internally and externally because you are going to miss something if you only approach it from a narrow perspective.
And while there isn’t necessarily a secret sauce to creating a perfect strategy, Kevin believes in leveraging frameworks (e.g. SWOT analysis, Point of Parity/Point of Difference Model) because they help create structure, mutual understanding and alignment.
Once it’s developed, however, you still need to constantly iterate on the strategy by examining the outcomes, analyzing the results, and starting the whole research analysis process again.
A strategy requires a lot of intellectual honesty. Just because you say you do something as a company or you write it as a goal doesn't necessarily mean you have the capability, the resources, or the know-how to do that.
One of the most important things is to make sure that someone at your company is responsible for strategy. If there is no one with a holistic understanding of the strategy and the ability to communicate it, you won’t make progress.
A valuable way to develop your strategy is leveraging frameworks. You can even think of it like a Venn diagram where it’s the intersection of what you are passionate about, what you are great at and how you make money.
Strategy development should also be top down, and then bottom up. You're going to miss something if you only approach it from the entry level or the mid level or the top level. You really need to get all throughout the organization.
It’s critical to create alignment when building your strategy and then making sure that you're communicating the process and the plan. If people don't understand the strategy, they can't buy into the strategy and it will never be executed correctly.
The process of creating a strategy starts with research and analysis and your research should involve going outside of the organization and interviewing people externally. It needs to reflect an outside in, inside out, top down, and bottoms up perspective. And this insight should be collected on an ongoing basis.
Think of it as a circular process where you research, plan, get feedback, implement and analyze your activity which will lead you back to potentially need to do more research. It’s ultimately an iterative process.
A strategy isn’t one and one. You need to constantly iterate on it. And to do that, think of doing a pilot – build something small, deploy it in a controlled environment and see how it works.
And these iterations are also about having your cross-functional teams be part of the strategic planning process, putting in their input at every step of the way.
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