Tag Archives: starting out

What is a business strategy?

Strategy is a word that comes up over and over again in business. You’ve got to have the right strategy; marketing strategies, finance strategies, HR strategies; you can find all sorts of strategy building advice and templates online (Google produces 638 million results for the search term “business strategy”); but really… What is business strategy?

A strategy is a like a route mapMichael Porter (very clever man) defined a business strategy as the “broad formula for how a business is going to compete, what its goals should be, and what policies will be needed to carry out those goals”.

That’s a pretty good definition, in essence a strategy is the route map for getting from where you are now to where you want to be in the future.

So to work out a strategy you need two things: a clear picture of what “here” looks like, and a good idea of where “there” is.

What?!

If you don’t know where you want to be in the future this is a good time to stop and think about it!

Where do you want to be in 5 years time?Why are you doing what you’re doing? What would you like to be doing? What do you enjoy and what would you like to change? This isn’t your strategy – they are your goals or objectives.

These are big ideas, they take a bit of thinking about. But what I’ve learned is that you don’t need to know all the answers for certain at this stage – if you start now you have time on your side, time to move the goal posts more than once!

Possibly an easier question is “What don’t you want? What shouldn’t the future be like?” most of us have a pretty good idea straight away.

Which way?

A map is no good unless you know where you're starting from!You can’t build a strategy without a good idea of your current circumstances. The route map analogy is useful here – a map won’t help you get home unless you can work out where you are starting from so it pays to take some time to write down what you’ve got that you like and enjoy and what you are not so happy about.

Strategy time!

When you know where you’re starting from and where you’re going to the final piece of the jigsaw is to link the two up – set out your preferred route from “here” to “there” in a series of manageable steps.

It is often difficult to see where to start in order to make progress (if it was easy you would have already got there!) but it can be much easier if you break the route down into smaller steps. Over the following years you can weigh up every decision you make against this strategy and see whether or not it will help you reach your goal.

Meaning is like psychological oxygenAt the moment I am reading The Good Psychopath’s Guide to Success by Kevin Dutton and Andy McNab. In it Andy McNab points out that “meaning is like psychological oxygen” – knowing why you’re working hard is the most effective personal power source.

He then goes on to tell a story that illustrates how (in his words) “There’s nothing like a task that is both pointless and physically draining to rip the **** out of you, especially if you don’t know when it’s going to end.”

To me this is where the biggest benefit of a strategy is – if you know that you’re on your way to your better world your effort is not pointless. You are working towards something, you can measure your progress along the way.

Expect the Unexpected: Why I don’t work without a contract

In order to gain a licence to work as an independent Management Accountant I have to do a number of things – I have to have insurance, in case I make a mistake; I have to have a contract which is about 7 pages long, and I have to have a complaints procedure and an ethics procedure.

A house in North Devon which caught fire last month after being struck by lightning... proving that things like that really do happen in real life.

A house in North Devon which caught fire last month after being struck by lightning… proving that things like that really do happen in real life.

When I meet clients I have up until now felt rather embarrassed by the fact that there is so much focus on things going wrong. The complaints procedure seems a bit silly since I am the only person in my business – if you’re not happy there’s no one else to speak to!

However, I have recently been helping a client with a tricky problem which has made me see this in a different light.

Two years ago my client started working with another consultant. They agreed terms etc in an email conversation, but never prepared a written contract to be signed.

One of the terms agreed was that after 2 years the deal would be renegotiated. Now after 2 years have passed my client wants to end the working relationship because it hasn’t delivered the results either side had hoped for, but the consultant feels they are due payment for work on projects that have not yet finished. You can probably imagine the argument that has ensued.

If only there had been a contract at the outset – it wouldn’t have prevented the relationship ending, but it would have made clear instructions as to what each party needed to do (and pay) at the end. By agreeing it at the start, when both parties are friendly it would be more likely to ensure that there was a reasonable deal for both sides.

So this experience has pointed out to me exactly why I have such a detailed contract, even though if my contract is terminated I only get 30 days notice and nothing else.

The point is that I will hopefully be able to avoid having to express all the anger and upset that typically comes at the end of a relationship. In future I’ll be more proud of my contract!