The Elements of Strategy

A Pocket Guide to the Essence of Successful Business Strategy

by Mark Daniell
Palgrave Macmillan © 2006
112 pages

Focus Take-Aways
Leadership & Mgt. • Strategy involves planning certain actions to achieve precise goals.
Strategy
• Workable strategy requires careful attention to content and process.
Sales & Marketing
Finance • The right strategy will inspire, improve and strengthen your organization.
Human Resources
• When you evaluate your strategy, results are the only criteria.
IT, Production & Logistics
Career Development • Consider the numerous existing strategic models and then choose one that fits
Small Business your company’s purposes.
Economics & Politics
• The modern business world increasingly prioritizes socially responsible
Industries
corporate strategy.
Intercultural Mgt.
Concepts & Trends
• Corporate plans must be adaptable to succeed.
• Planners can learn tactics from great military strategists.
• A company’s plans must include comprehensive diagnosis, and program design
and implementation.
• The more people you involve in the planning process, the more buy-in you will
have for implementation.

Rating (10 is best)

Overall Applicability Innovation Style

8 8 7 7

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 Relevance

What You Will Learn

In this Abstract, you will learn: 1) What 27 elements your corporate strategy should include,
from choosing a strategy to implementing it in stages; 2) Why corporate responsibility
matters in planning; and 3) How to implement your strategy in seven steps.

Recommendation
Although far too many strategic plans end up in back rooms collecting dust, strategic
planning should not be an ivory-tower exercise. Indeed, to have a viable, competitive
future, your company must set corresponding goals and make realistic plans to achieve
them. Mark Daniell’s knowledge-packed, brief (a scant 100 pages) book on strategy is a
valuable guide for corporate planners who are developing strategic blueprints to achieve
long-term goals. getAbstract recognizes the inherent value of well-planned pocket guides
that efficiently summarize vital, complex business topics in a digestible format, complete
with handy checklists and other easily accessible data. Daniell’s superbly organized book
is exactly this kind of worthwhile guide.

Abstract

The 27 Elements of Strategy

“Strategy is the Every organization needs a well-conceived, goal-oriented, structured strategy that it can
art and science of implement realistically. Your strategy should align the objectives of each department or
informed action endeavor. A comprehensive strategy covers 27 basic elements, in these areas:
to achieve a
specific vision,
an overarching Learning from History
objective or a The process of strategic planning has changed over time.
higher purpose
for a business
enterprise.”
1. “Missing elements of traditional strategy” – Good strategy must be comprehensive,
flexible, creative and appropriately aligned. It should fully engage and motivate your
workforce, and reflect your sense of corporate responsibility. Replace old, impractical
strategies with useable approaches that offer a measurable impact.
2. “Traditional models of strategy” – Look beyond formerly popular but nevertheless
limited or flawed models to develop your company’s strategic plans.
3. “The 7S’s Model” – This McKinsey standard is still a worthy checklist:
“Together, the • Strategy – Decisions taken to gain corporate advantage.
elements of • Structure – The overall plan to identify primary tasks and duties.
strategy combine
to steer a
• Systems – Processes and procedures.
business in the • Staff – The right people will make your plan work.
right direction and • Skills – Desirable capabilities and capacities.
reach its ultimate • Style – It trickles down from the leadership level.
destination
faster and more • Shared values – They set your organization apart and make it special.
effectively than its 4. “Sources of insight” – For decades, company planners have turned to numerous
competitors.”
valuable sources of strategic thinking, including martial arts, military strategy,
science, politics, economics, psychology and past experiences. These fields teach
you to ask, “What is your victory plan?” “Are your alliances working?” “Are your
people motivated?” and “Are you using what you already know?”

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 Steps in Strategic Planning
“Perhaps one of
Make your strategy logical, flexible, creative and innovative. Focus on long-term goals.
the most important
reasons that 5. “Respecting process principles” – Superior strategy depends on proper process. Shoot
the traditional for focused planning sessions that include diverse viewpoints. Outline objectives.
tools of strategy
have lost their
Deal in facts and logic, not hope and emotion. Extend the boundaries.
cutting edge is 6. “Diagnostic phase” – To assess your strategy needs, ask: What is your company’s
that management current state of affairs? Are you properly structured? What challenges do you face?
too often severs
process and
What new or special opportunities exist? What are the strengths and weaknesses
content.” of your business units? Can you cut poor performers? Where do your competitors
stand? What strategic options exist? Probe every area of your operation.
7. “Design phase” – Combine all strategic elements and considerations into a focused,
clear plan for implementation. Outline the “promise,” which states your mission,
values and priorities, sets a plan for engagement, delineates duties and tasks, and
“In this ephemeral
details the actions you will take. Establish clear, achievable targets.
world, it is 8. “Implementation phase” – Activating your new strategic plan requires sharp tactics,
essential to realistic timing and an implementation team with top managers. Seek feedback.
anticipate change,
recognize future 9. “Documenting strategy” – To boost employee morale and to encourage people to
trends and work toward strategic goals, communicate and document each planning stage fully.
invest to create
Integrate all your central business functions. Mesh each group’s goals.
the maximum
competitive 10. “Differentiating characteristics” – How you enact your strategic plan is as critical
advantage out as its goals. Always fully integrate content and process. Involve as broad a group
of inevitable
change.”
as possible in planning and taking action. Adopt a unified approach to leadership,
resource allocation and implementation. Be flexible. Adapt your plan in light of your
competitive circumstances.
11. “Improving creativity” – To stay competitive, your organization needs to be creative
in operations and in strategic planning. Broaden your brainstorming so everyone can
participate. Consider the perspectives of your direct competitors. Step outside your
“By neglecting
the aspirational
industry – or even outside the business world – for new ideas. What can you learn from
and motivational the arts, politics, science, culture and other fields? Be a renaissance organization.
elements that lie 12. “Managing trends and influences” – Is your strategic plan only a snapshot of your
at the heart of
every business, organization at a particular time? If so, it is in trouble. Create a fluid strategy
many strategies that enables you to stay abreast of the evolving business world. Can you adjust to
failed to create globalization, market turbulence and technological change? Are your operations
the energy for
change.”
becoming more virtual?
13. “The 7C’s Model” – Consider seven Cs in strategic planning: “costs, customers,
competitors…context, capabilities, channels and capital.” “Context” refers to your
company’s business environment, as characterized by politics, trade issues, patent
ramifications, regulations and so on. “Channels” refer to your distribution methods.
14. “The ‘rights’ of strategy” – There are right ways to do things:
“A cogent, crisp
and concise • The right process – Get the proper team involved.
summary of your • The right attitude – Be collaborative and committed.
strategy provides
the foundation
• The right people – Strive to deliver the best results.
for aligning group • The right content – Cover everything important. Set the right priorities.
and individual • The right thoughts – Be objective.
objectives across
even the largest • The right creativity – Get out of that confining box.
organization.” • The right results – Keep objectives exactly on target.

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 Making the Right Choices
Planners face multiple options. Explore each one openly and creatively. Be sharp and
“Finding out
where wisdom, selective, because your strategic-planning decisions have long-ranging impact.
information and
skills reside in 15. “Comparative option valuation” – No organization can accomplish everything that
your organization, it wants to achieve immediately. As you plan, carefully weigh crucial priorities:
and how you draw
on and profit from
shareholder value, net present value (NPV), enterprise growth, future capabilities,
these valuable customer relationships, competitiveness and profit.
repositories, are 16. “Setting priorities” – Setting clear priorities is an important strategic-planning
critical elements
in preparing
task. Chart a path others can follow. Allocate resources sensibly for maximum
your business returns. Develop an achievable vision everyone can accept and support. Show all
for the future.” the necessary action steps on a “2 x 2 matrix,” a graph with intersecting horizontal
and vertical axes. The horizontal axis shows the overall, long-term value of specific
priorities. The vertical axis illustrates each item’s degree of difficulty. To make
the right resource allocations and investments, differentiate between high and low
priorities. Proceed according to crystal-clear priority choices.
17. “Smarter goals” – Target intelligent, realistic goals your firm can achieve. Make
them uncomplicated, meaningful and actionable. Target activities that make you
“Even in a process more competitive. Process matters, but the real goal is results.
which has a highly
intuitive element, 18. “Tactics” – Now you have a workable, results-oriented strategy everyone supports.
it is important to So what are your tactics? Tactical activities include gathering intelligence, analyzing
communicate
effectively,
information, allocating assets, negotiating, building alliances and developing
including capabilities. Recognize and seize opportunities. Timing matters, as does sequencing,
developing that is, intelligently planning the order of your activities. Set realistic expectations; if
the skill of outcomes do not match those targets, be ready to activate further tactics.
‘active listening’.”

Take Responsibility
Your company’s approach to corporate responsibility can inspire your personnel, create
a sense of purpose and enhance your corporate and civic network.

19. “Corporate responsibility” – Living up to your corporate responsibilities is a crucial

gauge of your success. Pay attention to:
“We all need to
think and act like • Workplace – Consider health and safety, and other employee issues.
Renaissance • Business systems – Set high corporate-behavior standards. Be sure your partners,
men and women
franchisees and any other allied parties comply.
to extract the
full potential • Reporting – Deceptive or inadequate reporting processes can undermine your firm.
of our modern • Governance – Avoid shareholder lawsuits by staying righteous.
businesses.”
• Customer rights – This litigious area is growing more important daily.
• Environment – Stay on the right side of this emotional, high profile issue.
• Community – Become an active part of your community; it’s smart business.
20. “Why become engaged?” – Being socially responsible makes business sense.
Irresponsible firms can pay a heavy legal and financial price. A responsible attitude
enhances your brand.
“The era of truly 21. “How the private sector can contribute” – Your firm’s savvy skills can help your
responsible town, state, country and the globe. Extend your vision and planning beyond profit.
strategy is
just dawning.”
22. Be “practical” – Corporate responsibility, environmental sustainability and employee
engagement are important new realities. Address them in a practical way. For example,
sponsor socially responsible programs that relate to your core business activities.

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 Leadership Tenets
Establish a framework for thoughtful, comprehensive, practical leadership.
23. “Principles of leadership” – Your firm needs visionary leaders who focus on results
and values. They must engage others, collaborate and innovate.
“Good strategy 24. “Strategic organization” – Structure your organization to meet its specific challenges.
is not just about Do you have the skills, organization-wide, to meet your goals?
respecting
principles and
25. “Trends in organizational design” – Business trends include globalization, mergers and
directives. Asking acquisitions, strategic alliances, decentralization, downsizing, advanced technology
the right questions and a greater focus on intellectual capital. Consider these trends as you plan.
is an equally 26. “Principles of the Orpheus process” – The Orpheus Orchestra is unique because it
important part
of the process.” has no conductor. All the musicians work together harmoniously. Can your CEO
set aside the personal need to lead at every juncture? Can your leadership be more
democratic? Can your senior managers move on, looking forward, if their ideas
are not adopted as part of the overall strategic plan? No executive is infallible. To
accomplish more, put egos aside.
27. “Testing organizational design” – To create a smart strategy, ask the right questions.
For example, is management in touch with customers? Is the level of control
appropriate? Are the right people in place? Can the organization minimize conflicts?
Does the compensation program make sense?
“As in tournament
chess, good
“The Final Element: Beginning Your Own Strategy”
business After you consider the elements of strategic planning, take action in seven steps:
strategists
think many
1. “Assemble and brief the core team” – Designate three to eight people as a “core
moves ahead.” strategy team.” This usually includes the CEO and other top departmental leaders.
Give all your decision makers time to comment and make contributions.
2. “Outline an overall timeframe” – Set a schedule for your strategy program. One
suggested preparation framework is four to six weeks for “diagnosis,” four weeks
for “design,” and two to four weeks for “implementation planning.” In larger, more
complex organizations, the planning stages and the implementation take longer.
3. “List participants in the process” – Start with your core team and add supporters who
add specific expertise. Having the best people indicates the merit of your program.
4. “Develop a communication program” – Use internal briefings to keep crucial people
involved and to give a larger circle of affected parties a sense of “ownership.”
“Good strategy 5. “Allocate responsibilities” – Give each person a straightforward statement of his or
requires her duties. Note everyone who has input in – or approval of – each analysis or task.
constant and 6. “Specify meeting schedule” – This is your accountability lever. Tie your calendar of
comprehensive
change.” meetings and strategy sessions to the completion of specific duties. Take advantage
of occasions when participants from different locations are together.
7. “Emphasize results” – Build a focus on results into your strategic planning from
the onset. Make your goals part of the agenda at every stage, from budgeting to
operations. Assess the value of your strategic-planning program in terms of the
results it achieves.

About the Author

Mark Daniell is an attorney and corporate strategy consultant who appears regularly
on CNN, CNBC and the BBC. He has held leadership jobs in investing, international
banking and consulting.
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