A Tactician’s Guide to Strategy By Jon Orozco, MBA, SHRM-SCP. Author’s note: This guide breaks into four digestible phases. First the fundamentals of effective strategy. Then my approach. What is strategy, anyway? Fancy MBA terms will walk you through building a unique plan that involves a position and the maximization of activities for success in your niche. To me, strategy is three words: How to Win. Strategy is about winning. Whether you define winning as buckets of money or as accomplishing your organization’s goal of saving the world, define what winning means. Dig deeper into those words and a strategy must include six elements: An assessment of your market. Your company picks a corner to compete in intentionally. You and your team master your craft. Your organization fights to keep most rivals out. You select the activities your company will not undertake. Your team and company resources stay in sync. Whatever the end game, careful planning, the right resources and tools, and constant adjustment of your strategic roadmap is the only way to win. Why? The game changes. The landscape evolves. Your competitors think and recalibrate too. There is more. Like the secret recipe of Coca-Cola or the secret sauce on a Big Mac, any product fit for the market has a distinct element. A strategy only works when tacticians align the leaders and managers of the company around the right competencies, psychometrics, and emotional intelligence. My approach will deviate from the pack. You have to make your own path to be a trailblazer. Here is how. Your managers must evolve into influential, emotionally intelligent leaders. Your leaders must coach with compassion. Being kinder than necessary is what lets your team recalibrate and refocus as they build the plane already in the air, with the weather and the destination changing. All of this becomes what is called Strategic Intention, and it demands your full attention. Phase One: The Role of a Strategist and Understanding Competitive Forces One of the original thought leaders on strategy, Professor Michael Porter, wrote “How Competitive Forces Shape Strategy.” He laid out the essential functions of the strategist and how she copes with competition in the marketplace. Porter argues five competitive forces are in play: The threat of new entrants. The power of suppliers. The power of buyers. The risk of substitute products or services. Rivalry among existing competitors. New entrants are competitors coming into your corner to take market share. Suppliers with power can charge premium prices, limit quantities, and force vendors to fund product or service development. Buyers with power demand lower prices and higher quality, and force competitors to court them. Substitutes create uncertainty as other industries pull your target customers away. Rivalry brings disorder. Competitors race to price-compete for market share, which cuts revenue and profit while you fight the other four forces at the same time. Phase Two: Fundamentals of a Classic Strategy Porter returned in “What is Strategy” and amplified the ideas around the company’s approach. He covered creating a plan to win by assessing and selecting a market, defining success, creating goals, allocating resources and tools, and knowing how to define defeat. Before you can be a formidable foe in business, you have to master organizational effectiveness. Why? How can you be moved on a chessboard when your pieces are not aligned and lack defined roles? Organizational effectiveness (OE) means being substantially better at the essential functions of your craft than your direct competitors. OE is about efficiency. Mastering your utility. Reducing waste. Building more widgets or services faster and better than before. Maximum value at the lowest cost. To get there, eliminate unnecessary mistakes. Deploy technology. Automate as much as possible to increase profitability. If you need guidance, the MBA hoopla terms apply: change management, continuous learning, and other words that do the same thing. Make the company leaner and better. OE only gets you so far. Rivals see your success (and your ideas), wise up, and counterpunch. Once the tactician guides the organization to mastery of the OE essentials, you have to move to strategic positioning. Strategic positioning is where the organization intentionally performs its essential functions differently. Rivals can mimic, but not without significant changes to their business model and plan. Retooling and retraining is significant work. It can be nearly impossible if two companies specialize in different positions. Kia venturing into the Lamborghini market would have to rethink the entire concept of luxury versus run-of-the-mill cars. There are three positioning segments. First, variety-based positioning. The company focuses on a specific product or service, like Jamba Juice or Salt and Straw. Jamba Juice does blenders, juicers, mixes, and nothing else. Salt and Straw does fresh-made ice cream with funky seasonal flavors. Second, needs-based positioning. The company locks in on a specific group of customers that need a diverse group of items in the right price range. Think Walmart, with everything at low prices. Or Chase Private Client, where a high-asset minimum gets you all your banking needs handled. Third, access-based positioning. The company focuses on a geography or customer scale. JetBlue uses smaller airports like Long Beach to offer better service and save on costs through streamlined operations. Why does a tactician intentionally pick a strategic position? To keep rivals out by making it expensive and complicated to follow you. The trade-offs are significant, for you and for them, because your business model is specific to those essential functions. Whether you are a specialized fresh and organic burger joint or an electric car company, entering your arena takes concerted effort. Strategic positioning forces competitors to think hard. Joining your world makes them incongruent with their brand, forces capital investment in retooling, and requires team reorganization. The company’s master plan matches OE with strategic positioning perfectly. Innovative competitors will see it and bow out gracefully, hunting for another market to corner. Once you establish your corner, two cautions: be consistent and intentional about your focus, or you enter a tailspin that confuses customers, splits your team’s efforts, and wastes resources. Imagine if the Dollar Store made high-end designer bags. Consumers would cringe. Teams would be baffled. As TLC said, don’t go chasing waterfalls. Phase Three: Specifying Your Strategy Type With the classic strategy fundamentals covered, look at the other three. Professors Reeves, Loves, and Tillmanns argue in “Your Strategy Needs a Strategy” that there are four advanced strategic paths: classic, adaptive, shaping, and visionary. Their thesis sits on two essentials in any industry: predictability and malleability. Predictability is the ability to forecast the future. Malleability is the probability that you (and competitors) can shape the industry. An adaptive strategy keeps most of the classic essentials, but the plan covers a shorter period and evolves quickly. Adaptive requires the strategist to recalibrate, read the battlefield, and change tactics as competitors encroach. Examples: divest assets that have become liabilities, or sell them off to reallocate resources. In the adaptive state, expect tacticians to be nimble and less efficient than a well-oiled machine. That is okay. They can move deliberately to accomplish a goal or beat a competitor. Expect the strategist to recommend devices that are 80% as efficient as the best-seller at a third of the price. Good enough. The savings fund other areas. Like a weatherman reading the winds and incoming storms, the strategist plays ship captain. She watches the shifts in customer taste and market fluctuation and corrects course. Shaping is like adaptive but more volatile. Almost nothing is established. Expect brief planning periods, and even shorter periods before the strategy changes again. As the name suggests, shaping requires the strategist to move fast and build hubs of commerce that attract the masses. Shaping carries real risk. The company is marshaling resources behind a product or service with no ecosystem yet. The ecosystem has to be built. With risk comes reward. When the iPod hit the market in late 2001, it was not the first music player. That was Sony with the Walkman in 1979, which created a new consumer product and segment: portable music. The iPod brought portable music into the 21st century. Hundreds, then thousands, of songs on a single device, versus a CD that held maybe 20. Apple added iTunes so consumers could buy albums, individual songs, audiobooks, and digital recordings to sync to their iPods. Visionary is brand new. Like the all-screen iPhone Apple released in 2007. Nothing else in the category. It disrupted several industries at once. Visionary requires careful planning because customers need guidance on who, what, and where they are engaging. Phase Four: Executing and Adapting the Strategy Phase four is execution and adaptation. Arguably the most important part. This is where the rubber meets the road. A great strategy is only as good as its execution. You need a clear plan to implement it. As a member of the leadership team, no matter the size of the company, vocalize and convey the strategy with clarity. Stay in sync with the rest of the leadership team. Line management needs direction and guidance. They need answers and focus to succeed. The most effective approach for a 21st-century workforce is an organic two-way conversation that includes uncomfortable talks. The strategy is only as strong as the leaders rallying behind it. Inclusion matters. Intent matters. Strategy spoken with clarity is storytelling at its best. You communicate the careful planning, the climb, the tools and resources, and the urgency the team needs. Why? You are painting a blank canvas with broad strokes and asking for help shading the areas you missed. Most importantly, if they disagree, they need to tell you so you can recalibrate. As you lean into the story of strategy, three things become crystal clear: strategic intent, mission, and commitment. To execute, the organization has to align all stakeholders around the strategic goals. Train and equip employees with the right skills and resources. Build a strong communication and feedback system so everyone is working toward the same goals. Beyond execution, prepare to adapt. The market and the competitive landscape evolve. The strategy has to adjust to stay competitive. Ongoing monitoring and analysis surfaces emerging trends and threats. Phase Five: Improving Strategy with Information and Transparency Information asymmetry and transparency shape competitive advantage. Uneven access to information and varying levels of transparency between stakeholders affect who wins. The competitive landscape gets distorted when some players exploit information gaps and others cannot compete on a level field. This matters most in the digital age, where access to information and the ability to analyze it can swing competitive advantage hard. To be clear: information asymmetry means some players have more information than others. A supplier may know market trends or competitor moves the buyer does not. Transparency is the opposite. Information is open and accessible to everyone. This shapes competition. Suppliers with better information negotiate higher prices or better terms. Buyers with more information demand lower prices or better terms. Asymmetry can keep new competitors out of the market. Transparency makes it easier for them to understand and compete. Instead of pursuing the typical path of masking your strategy from competitors, flip the approach. Focus on your clients. Use information asymmetry and transparency to attract more clients by giving them more information and more transparency. You build trust and credibility. Both are essential to attracting and retaining clients. Offer precise, detailed information on your products, services, and operations to show expertise and commitment to client satisfaction. Transparency helps clients feel confident working with you and increases the likelihood of repeat business. Use data analysis to understand customer preferences and trends, then tailor your offerings to your target market’s specific needs and desires. Phase Five: Execute to Win Strategy is the cornerstone of any successful business. It is about winning, which means creating a plan with a position and the maximization of activities for success in your niche. To build an effective strategy: assess the market. Pick a corner intentionally. Master your craft. Fight to keep rivals out. Select what you will not do. Keep team and company resources in sync. A strategy only works when tacticians align the leaders and managers around the right competencies, psychometrics, and emotional intelligence. Porter’s work on competitive forces frames the fundamentals: build a plan to win by assessing and selecting a market, define success, allocate resources, and fend off competitors. OE is essential. It means being substantially better at the crucial functions of your craft than your direct competitors. Once you have achieved OE, move to strategic positioning. Perform your essential functions differently and intentionally. The key to success is careful planning, the right resources and tools, and constant adjustment of the strategic roadmap as the game changes, the landscape evolves, and competitors recalibrate. Being a trailblazer means making your own path. To do that, your managers must evolve into influential, emotionally intelligent leaders. Your leaders must coach with compassion. That is what lets your team recalibrate and refocus as they build the plane already in the air, weather and destination shifting. Porter’s competitive forces, OE, and strategic positioning are the elements. Becoming a strategic tactician demands your full attention.