MBA bingo – making strategy complicated
There is an old joke – how do you know if someone has an MBA? They tell you … And as any MBA student will also tell you, you can play MBA bingo during any lecture and many CEO presentations – choose some phrases like “synergistic benefits”, “cross-pollination”, “client-centric focus” and many others and you'll soon have the foundations for a bingo game and tittering from the back row.
What you'll also get is strategy made complicated when it really does not need to be.
The deer-in-the-headlight look
I've had the privilege of meeting some very bright entrepreneurs, who have a fantastic idea and vision. But when I ask them what their strategy is, a lot of them scribble some mind-maps onto a piece of paper and complement them with some vague discussion on a few high-level notions of what the little circles mean to their vision.
The deer-in-the-headlight look comes when I ask them some very simple questions:
1. Where do you want your business to be in 5 years' time? What turnover and margins will you be making? What markets will you be serving?
2. What is the outcome of a quick SWOT analysis – give me the top 3 points in each section and tell me what they mean to you
3. What do you need to do to get to where you want to be in 5 years' time? What resources do you need that you do not have now?
If these questions can not be answered in less than 10 minutes, you have no strategy. Equally, if they can only be answered by a lengthy thesis, you have no strategy.
What strategy is not
Strategy is not “I have a good idea and I know it will sell”. There is a big “why” and “how” left out of that statement. Equally, neither is it a set of pretty slides filled with MBA bingo.
What strategy is
Strategy is a well-thought through and succinct plan of where you want your business to be in 5 years' time and what resources that you do not have now you will put in place to get there. It is also fluid and will never remain static. Be prepared for and accept the fact that your strategic plan must evolve regularly as circumstances change and new opportunities present themselves.
Of course that is an over-simplification of a long process that leads to the succinct plan. You absolutely do have to answer the following:
- What is my product or service
- Who are my competitors and how do they do business
- Who are my clients going to be and how am I going to reach them
- What is the total market for my product or service and how much of it do I want
- What does a SWOT analysis tell me
- How am I going to make a profitable return (and, on this, remember that turnover is bling but cash is king!)
There are many other strategic tools to use and you can be as complicated in your analysis as you want. But if you do not have a clear, succinct and adaptable plan at the end of it you have wasted your time.