Strategy Formulation

Key Concepts

In this chapter, I introduce the language and several key concepts of strategy, to help with your first meeting with your boss when he or she asks you to lead a strategic planning team. The language can be confusing because it is imprecise and many practitioners add their own spin, create their own buzz words, about fundamental concepts.

Ask your boss these five key questions, in the graphic image on the right.

Make a judgment of how process driven, formal, the planning needs to be. Process is important. At the firm, business unit or department level, we use a process to formulate strategy to:

• deal with uncertainty methodically
• recognize patterns of change, prioritize alternatives and decide the best route
• ensure that the customer is the focus of our business and we provide them value,
• understand our costs, our competitor's costs, and how others complement our business

Strategic planning has been around for thousands of years. The word strategy comes from the Greeks, around the time of Athens' war with Sparta. It referred to the leader who planned and conducted military campaigns. For thousands of years, people expect that someone is thinking strategically.

The five questions are about leaders choosing when and how to act: what do we know, don't we know? Who should be involved? Why now? Radical or measured? When?.