An often undervalued and sometimes overlooked role of the leader is the creation of strategic direction. Organizations have options – perhaps more than ever before. In their quest for competitive advantage, which path should they choose?
Pick any business, maybe your own, and imagine the options…
Do we pursue quality as a differentiator?
Do we increase our product offering?
Do we reduce our product line and specialize?
Do we pursue a low-cost positioning?
Do we pursue industry leading cycle time?
Do we work to become the industry innovators?
Do we want to pursue first to market strategy?
Do we want to be a fast follower?
Do we diversify?
Do we go global?
Etc. Etc. Etc.
The options are too numerous to recount; they are probably unlimited! How are these decisions made?
Leaders set strategic direction. Consider these examples…
Jack Welch established the strategy that every business they owned would have to be # 1 or #2 in their respective field. This drove radical improvement in some businesses and led to the sale of others. Most would agree, Jack’s decision on this significantly strengthened G.E.
George Washington was determined that our new nation would not be a monarchy. He refused to be named king of America. Even with our current political challenges, Washington’s strategic direction has stood the test of time – 216 years and counting.
Sam Walton believed that Everyday Low Prices would help Americans live better lives. Thousands of projects, initiatives and systems have been designed and executed over the years to help Wal-mart create the largest business in the world.
Dan Cathy knew that the food at Chick-fil-A was a great foundation for a strong business, but it could be copied. He believed that our people could create competitive advantage that would be hard for the competition to emulate. It’s a journey we’re still on today.
Herb Kelleher wanted to offer more people the opportunity to fly. The only way he knew to do this was to make Southwest a low cost airline. They didn’t cater to business travelers, they've never offered meals and they’ve never charged for luggage. They’ve also been profitable for the last 39 years!
Bill Hybels believed that his church needed to approach their calling differently. Rather than build a church for churched people, he focused his congregation and staff on the unchurched community. The result, Willow Creek Community Church is one of the largest churches in America.
Certainly, this isn't the end of the story. After the direction is set, there is still much work left to be done. However, until the important decision of strategic direction is made, the battle for corporate resources has no boundaries. In the absence of strategy, every idea is of equal value. That’s a dangerous way to run an organization.[GLS_Shield]
How do leaders make these decisions? See my previous post: 4 Keys to Strategic Insight.