The majority of strategies fail.
As a strategy and business development coach for new entrepreneurs, this is something I’m quick to point out to people.
It’s as high as 70%, according to Harvard Business Review.
Why do most business strategies fall apart?
There are a lot of different reasons. Sometimes, it comes down to problems at the strategy development phase. Here are a few risks to strategy that I’ve found particularly potent.
Stopping at a vision.
A vision is essential, but not sufficient. It’s too ambiguous to drive real actions or decisions when it counts. Because a vision is open to interpretation, it leads to decision paralysis and therefore no action.
Saying yes to everything.
At a very basic level, strategy is about seeing everything in terms of trade-offs and options. So, by saying yes to something, you’re saying no to something else. That’s because you only have so many hours in the day and a limited amount of resources at your disposal. A strategy is a way to maximize what’s available to you.
Jumping immediately to tactics, process, and structure.
Eventually, these steps are needed. But they become logical conclusions after other choices have been made. Defining an organizational structure, for example, without first deciding the activities of the organization tends to lead to discussions that go in circles.
Optimizing the status quo.
What you have might feel comfortable, so it’s normal to gravitate toward just making it slightly better. The problem, however, is that it will prevent you from imagining what’s possible.
Failing to create clarity.
Strategy isn’t just about having a plan on paper. The best strategies empower front-line people to make decisions and choices that support the strategy. If you’re not clear on who you serve in the market and your unique way to create value for consumers, you haven’t got a prayer of scaling your business effectively.
As an entrepreneur, especially if you’re on your own, these mistakes can be devastating to your progress. The start and stop nature of starting a business is normal. But, an effective strategy can accelerate your growth because it allows you to act with intention. If you want your business to grow and become more than just a hobby, then you need a strategy – one that provides a sense of clarity and, ultimately, makes decision-making a breeze. Clarity drives the right actions in the right direction.