Some people, particularly those who view business as primarily a value-generating entity, will argue that the core aim of strategy is to create value. Meanwhile, ask a marketing expert, and they’ll likely make a strong case for strategy being all about differentiation – carving out a unique market position to stand out from the competition. These objectives have merit and represent aspects of strategy worth pursuing.
However, these definitions can be limiting because strategy is a multifaceted tool applied across various contexts. When you consider strategies for personal goals like losing weight or scenarios like winning a basketball game or negotiating a salary raise, do the concepts of creating value or differentiation still apply? These situations suggest that the traditional view of strategy as merely a means to create value or differentiation is narrow and limiting.
The idea that creating value or differentiation applies uniformly across these scenarios falls short. Creating value or differentiation are specific perspectives on strategy that may apply in some cases but not universally.
So, what, then, is the ultimate purpose of strategy?
At its essence, what role does strategy play in our lives?
The Ultimate Aim of Strategy
A closer look at these diverse scenarios reveals a simple truth: the fundamental purpose of strategy is to improve your odds of success.
That’s it. That’s the simplest concept that explains what strategy is all about and why it exists in your toolkit for achieving success. Your strategic choices are driven by your assessment of which path will likely be the most successful.
Your decision on which path to take is guided by your estimation of whether that path offers the best chances of success. And when you examine various situations where strategy is employed, you can ask – does this overarching definition of strategy’s purpose hold true across the board?
For instance, does the notion that strategy enhances our success resonate in these 15 scenarios?
- Negotiating a raise or promotion at work.
- Planning a successful and cost-effective vacation.
- Preparing for a professional certification or exam.
- Developing a marketing campaign for a small business.
- Training for and completing a marathon.
- Managing household expenses to save for a large purchase.
- Organizing community action for a cause or initiative.
- Navigating a career change or transition.
- Building a personal brand or online presence.
- Learning a new language or skill efficiently.
- Crafting a successful college or graduate school application.
- Implementing sustainable practices in daily life to reduce your carbon footprint.
- Orchestrating a complex event like a wedding or conference.
- Creating a study plan for academic success.
- Developing a parenting plan to manage the challenges of family life.
In every one of those scenarios, you will try to develop strategies to improve your odds of success.
Advantage
Now, considering the purpose of strategy as a means to improve your odds of success, there’s a term that encapsulates this idea perfectly – “advantage.”
Advantage, quite simply, refers to any factor that increases your likelihood of success.
Hence, you can boil the true purpose of strategy down to this: the purpose of strategy is to create advantage.
Yet, the concept of “advantage” in business is often tied to the idea of competitive advantage. While competitive advantage is undoubtedly important, it’s not the whole picture.
There are scenarios with clearly defined goals, like achieving a certain weight or securing a job promotion, where strategy is about navigating the journey.
Does the selected strategy enhance your chances of success better than other alternatives? I call this “advantage in the journey,” and it’s highly relevant in business. Any challenge a business faces can be assessed to determine which strategy offers the best chance of successful resolution.
In business, however, the endgame isn’t as neatly packaged; business is an ongoing saga akin to the journey of life. You aim for continuity and enduring success, ensuring that every strategic move positions your business for a healthier, stronger future with a competitive advantage.
In the business world, you’re pursuing two types of advantage: the advantage in the journey and the advantage in the destination – the former concerning the immediate path and the latter, our long-term competitive stance.
Advantage in the Journey
“Advantage in the journey” refers to the strategic benefits that aid in overcoming immediate challenges and effectively progressing toward a goal. It’s about making the right choices that give you an upper hand in the here and now.
Example: A sales manager at a software company is preparing for a crucial product launch. The “advantage in the journey” is realized when she devises a short-term strategy that includes a series of targeted pre-launch marketing campaigns, training sessions for the sales team on unique selling points, and partnership deals with influencers in the industry. This strategy is designed to build immediate interest and momentum, ensuring the product makes a significant impact upon release, thus improving the odds of a successful launch.
Advantage in the Destination
“Advantage in the destination,” on the other hand, is about setting yourself up for long-term success. It’s the strategic foresight that ensures your actions today will lead to a sustained, competitive position in the future.
Case Study: Let’s consider a tech startup focused on renewable energy solutions. In its early stages, the company prioritizes research and development, securing patents for its innovations — this is an “advantage in the destination.” It’s not just about immediate sales; it’s about creating a foundation that will give the company a stronghold in the market for years to come. As a result, when the renewable energy market matures, the startup is well-positioned with proprietary technology, leading to long-term success and a significant market share. This advantage ensures the company’s sustainability and growth, aligning with its vision of being a market leader in the renewable energy sector.
Testing Your Strategy
This duality of advantage in business presents a set of criteria, tests to apply to strategy, broadening your understanding and enabling you to select strategies that significantly improve your odds of success.
What tests can you use to assess if you’ve crafted an effective strategy? Let’s break them down.
First: Does the strategy improve your odds of success in the present moment? Is it the best choice for your current challenges? It’s about evaluating the immediate effectiveness of your strategic decisions.
Second: Does the strategy set you up for future success? Here, you’re looking beyond the immediate payoff to the long-term benefits. It’s about sustainability and making sure your strategy keeps your business competitive and relevant down the line.
And third: Is the strategy resilient? Can it withstand changes and adapt as needed? This is crucial because a rigid strategy that can’t evolve will likely fail as conditions change.
These three tests – assessing immediate effectiveness, long-term benefit, and adaptability – help you evaluate a strategy’s potential. When your strategy passes these tests, it will be more likely to play out well.
Strategy’s Broader Implications
Ultimately, strategy isn’t just about business. It’s about life. Whether it’s securing that promotion, planning the perfect getaway, or leading a successful company, strategy is the compass that guides you to your desired destination. It’s the calculated approach you take to navigate the complexities of your goals and aspirations.
In every scenario, the strategic application is about gaining that all-important advantage. And while ‘advantage’ may have different implications depending on the context, its essence remains the same: it’s the catalyst that propels you toward success, however, you define it.
When you embrace the role of strategy in your life, remember that being a strategist isn’t about leaving things to chance. It’s about hacking your luck and knowing when to make the right moves, being the one who understands that with the right plan, the odds of success can be shifted in your favor.
The Personal Journey of Strategic Mastery
Navigating these complex dynamics is where the artistry of working with strategy truly shines. The concepts we’re discussing are best learned through hands-on experience gained by practicing. While you can accelerate this learning curve by seeking guidance from a mentor, coach, or consultant, the responsibility of grappling with these challenges ultimately falls on leaders themselves.
Your grasp of strategy and your ability to execute it effectively hinges largely on your personal investment in it and your deep understanding and belief in its merits.
The most powerful way to foster this belief and understanding is through self-discovered logic. It’s the notion that your self-driven understanding of why and how you need to change is far more compelling and impactful than someone else dictating the need for change.
Conclusion: Strategy as a Life Skill
With these insights in mind, we’ve now defined the purpose of strategy and established approaches and tests for assessing its effectiveness. We’ve also emphasized the importance of cultivating a personal connection with your strategy through self-discovered logic—a key element in bringing your strategy to life.
In closing, strategy is your guiding star, not just in the boardroom but in every aspect of your life. It transcends business. Strategy is a vital tool that helps you realize your ambitions and dreams. Whether you’re charting a course for your business or navigating the personal odysseys of your daily life, strategy ensures you’re not at the mercy of the winds of fortune.
By understanding and applying strategy, you give yourself a clear advantage at every step. Embrace it, and let ‘advantage’ be your watchword, your ally, both in your journey and the rich mosaic of your destination. By mastering this art, you become the architect of your fate, transforming the abstract into the concrete, the possible into the actual, the dream into reality. So, arm yourself with good strategic thinking, for it is a powerful tool that guides you on your quest for better outcomes.
Until next time, Be Enactive. Be someone who happens to the world.
Best,
Alex
Your Customer: The First Competitor and Collaborator in Business