Many people’s idea of a great corporate strategy is one that pinpoints a winning direction with laser precision and keeps a company steaming ahead of competitors. Whether the strategy prioritises production growth, new products, or investment in employees, much of the thought leadership written about corporate strategy is concerned with getting out in front of the competition and then staying there.
That’s absolutely understandable. Who among corporate leaders wouldn’t want to lead their business to the front of their industry? But while it’s great to be waving casually to your competitors from a position at the front of the pack, it is arguably not at all that common a position from which most strategies are conceived.
For every company making strategic moves with the dominant market positioning of, say, Google or Amazon, there are many more that will be creating strategies where the concerted effort is in keeping up with market movements, or in repositioning a company away from a direction that hasn’t worked out.
If you think of this in terms of an athletic race, this is akin to the difference between the in-race strategy of a runner in the lead, and one who is half way back. The runner in the lead needs to think about pacing, the timing, and conserving energy for defensively handling the challenge of people close behind.
The runner further back needs to think strategically about some of these same things — their pace, for example, and their capacity to push on in the final few miles. But they must also think strategically about overtaking the runners in between them and first place. They need to pick their moment to advance, planning their moment carefully for when they surge up the pack.
The point is that these runners face different challenges, so much so that applying the strategy of the front-runner when you’re halfway down the running order is simply not going to work. This is true in business too. If your company has fallen behind in producing innovative product launches, then merely mimicking the products of the market leader is unlikely to truly make a dent in their dominance.
If you are losing customers because your basic customer service is inadequate, throwing money at flash new marketing initiatives to shine a brighter light on you is unlikely to do much good. Instead, you need to be thinking strategically about where your organisation currently is and planning the most effective route for running at a market from your current position.
That’s not to say that a corporate strategy can never shoot for dominance if a company is currently struggling. It absolutely should be part of a company vision that the combination of great product, great service, and great customer loyalty will produce long-term, market-leading success for stakeholders.
It is absolutely right that a company should seek to instill this same sense of optimism and purposeful direction into its employees to help drive the business forward.
But it should also approach strategy making with realism and informed understanding of where the company finds itself. It cannot simply bluster its way to success by acting as the market leader, or repeating its strategic steps over and over again, then expecting different results.
So, if a company finds itself struggling against newer, more agile competition, strategy making should begin with accepting the current state of affairs. Then it should consider the competitor’s advantages — has it been bolder in product innovation? Has it focused on customer service? Does it actively produce better outcomes for its customers than you can currently muster?
When you’ve thought about individual obstacles such as this, you can start strategically working out the way to overcome them, and then start plotting a route through the race to a position further up the pack. You can plot a shorter-term course of correction, then start building on this to strategically advance until you push your business into first place.
Even the very best of athletes find themselves off the pace occasionally, but they retake the lead when they are flexible with strategy, and willing to apply different techniques to force their way forward.
Ahmad Badr is CEO of Knowledge Group.