Successful Leaders Master These 7 Decisions of Strategy

Strategy

In today’s environment, good execution and good operations aren’t enough. You may manage the day-to-day profitably and solve problems as they happen. But many companies often stagnate. Competition becomes stronger and clarity on differentiation becomes fuzzy. Simply put many companies lack a clear strategy.

Verne Harnish helps entrepreneurs and leaders address their strategy issue in his new book, Scaling Up. Harnish provides a new comprehensive tool called the 7 Strata of Strategy that helps define a decision framework to dominate your industry. Here are seven key decisions to develop your strategy.

Is Your Sales Pipeline Protected?

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One of the most important decisions you can make as a business owner is to protect one of your company’s most valuable assets…your sales pipeline. The relationships that you and your team have built with customers and prospects will lead to future income. Some prospects will close now, some in three months, some in six months and some next year.

Too many companies don’t protect these assets, but rather leave them on scribbled notes and in the heads of sales people who leave the company taking these assets with them. And, if you don’t possess these assets, you can’t use them. Here are some recommended best practices to protect your sales pipeline by our guest columnist Caryn Kopp.

What Drives Your Economic Engine?

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Is your company on track to be as valuable as you want it to be? Is it growing? Is it maximizing profits? If you have difficulty with your answer, you are not alone. Now is the time to ask yourself the ultimate question to achieve change and focus in your business. What drives your economic engine with the greatest and most sustainable impact?

Author Jim Collins states a company can go from “Good to Great” if it determines and understands the intersection of three elements: 1) What it is deeply passionate about, 2) What it can be best at in its industry, and 3) What drives its economic engine.

Your economic engine is measured by one key metric that defines the essence of your business model and is tied to your long-range goal. And that metric is your revenue (or profit or gross margin) per “x”.

Your Focus Determines Your Reality!

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One of the biggest challenges for many companies is a lack of strategic focus. We say, “yes” to too many things. The result is reduced business performance, ineffective ways of working, and indecision among our teams. This leads inevitably to decreased motivation. I believe, as leaders, our prime directive is to confirm, clarify, and communicate priorities. Then we hold our teams 100% accountable for delivering on those priorities.

Focus drives priorities. Here are some of my favorite words of wisdom from great leaders and thinkers on the art of focus, prioritization and clarity. What are your favorites? Use one or more of these in you next leadership team meeting. Insure your team is focused on delivering on the right priorities, and getting the right things done.

Want a Better Strategy?

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“The world is shifting from selling products to selling subscriptions, and in the subscription economy, companies are focused on generating recurring revenue. So it’s not about the price of the product and the margin. It’s about delivering value to customers, so they don’t want to switch services.” This is the advice of Tien Tzou, CEO of Zuora, in his recent FORTUNE article.

In order to manage this effectively, Tien Tzou advises there are five things a company must do and one very important question to answer (yes, its all about asking the right question!) to leverage a once-in-a-century transformation in business.