Asking yourself these 5 questions could help you become a better strategist.
1. What is our growth strategy?
Does your business plan to grow organically or through M&A exercises? Are you considering expanding to newer markets or offering new products and services to existing markets?
You will have to understand your business’ current growth strategy and ensure that you have the necessary capital to make these choices profitable.
2. How can we get bigger and better?
This question helps you check if you are thinking big enough and how you could do something differently to grow even further. For instance, if your current goal is tripling your revenue. To do this, you may have to take some calculated risks and you realize that your ability to invest in future growth would be enhanced not by simply multiplying your current sales but by a series of acquisitions that give you the resources and bandwidth to increase them exponentially. Thinking ambitiously, beyond constraints and challenges, may help you come up with never-before solutions and leapfrog your business into the next level.
3. What are our constraints to growth?
Scrutinize what is preventing your business from reaching its optimum potential. It could range from cost of capital to lack (or shortage) of an essential component needed to manufacture your product to a lackadaisical attitude rampant amongst your team members. Then, offer insights and discuss with your CEO about how to tackle these challenges so the business can thrive.
4. How can I ensure better returns for the risks undertaken?
Let’s consider a scenario in which you are spending a considerable amount of money on advertising and promotional activities. Think of a.) How to make the most from every penny spent and b.) How to effectively measure the returns that these activities are bringing in. This exercise may be conducted across all avenues where you are not quite certain about the returns on the risks undertaken. Sometimes, you may have to take tough decisions like stopping a business unit that is not generating required returns. Look at the bright side: this could well free capital and resources for units with greater performance potential.
5. What is the competition up to?
A strategic move like a merger or ground-breaking new technology adopted by competition has the potential to transform the landscape of the entire industry. You need to envision such disruptive scenarios and have your arsenal to combat these ready.
Thus, we see that being strategic has less to do with knowing the latest organizational theory and more to do with asking questions that answer why your business is stagnating or lagging behind and how you can propel it forward.