Acclaro Growth Partners' M&A and Strategy Weblog

What is Strategy?

While strategic planning is intimidating to some, we can break the process down into six simple steps:

1.  What is the primary goal we are trying to achieve over the next 12 to 36 months?  Be as specific as possible, but limit the answer to one goal.

2.  How will we accomplish the goal?  What are the three to five big-picture actions that will enable us to accomplish this goal.  We'll call these strategies.

3.  Now, take each of these strategies and think more specifically about how they will be executed.  What are the three to five steps that must occur in order for each strategy to be carried out.  These sub-sets of strategy can be called tactics. 

4.  Who is responsible for carrying out each of these tactics?  Mid-level managered probably need to be involved at this point.  We will call them "champions" of each tactic.  There are somewhere between nine and twenty-five tactics, so one or two people cannot execute them over the next twelve months, which is the time-frame our strategic plan refers to.

5.  Speaking of timelines, we will need to explicitly address when each tactic will be accomplished.  Some will take a lot longer than others.

6.  Results:  What are the measurements of carrying out each tactic?  In other words, can we quantify their impact on the Goal?  If a tactic does not seem to address the Goal, we may consider eliminating it at this time.  If the Goal is, say, gain a million dollars in ebitda by the end of FY2011, we would specify how much in dollars saved or earned each tactic impacts the goal.

It starts, and ends, with the goal.  Then we answer "how" we will achieve the goal.  And finally, we describe who performs each tactic, how long it will take, and what the expected result of each tactic is.  There, not that complicated now, is it!  Just visit our website for more background information www.acclaropartners.com or call Kit on 703.434.3597.

Coping with a Down Market: Eight Steps for Dealing with a Troubling Economy

When faced with a downturn in the economy, many companies continue to operate, business as usual.  What they should be doing is making eight simple adjustments. 

1.     Reconnect with your best customers in a formal way.  Make a point of telling them how valuable they are to your business, and ask them in no uncertain terms what you can do to make life better for them.  If the requests are reasonable, fulfill them.

2.    Consider new market entry.  Not every segment you serve, or could serve, is down.  There may be opportunities to become more active in a growing segment, or one that allows greater room for profit.  Now may be the time to make the move into an ancillary segment.

3.    Study your competitors to learn from their mistakes (and their strengths).  What are they doing so well that you should emulate them?  What are they doing so poorly that they are creating opportunities for you?  In a down economy, some competitors are destined to make rash decisions that negatively impact their customers or their brand.  Become aware of the latest opportunities and threats being created by competitors.

4.    Become Operationally More Efficient.  Evaluate the process steps your organization carries out in order to earn revenue.  Are all of these steps necessary?  Are they occurring in the right order?  Can anything be done to improve the efficiency of these steps?  Are there unnecessary costs involved that can be eliminated?  While the most obvious way to cut costs may be to reduce headcount, there are often opportunities for working smarter, as well.

5.    Communicate, Compensate, Collaborate (and Organize) – Are you Taking Advantage of your Human Capital?  While reducing headcount may be the only HR initiative that comes to mind when the demand goes south, your company has several options at its disposal for increasing the value of your human capital.  Communicate with everyone to ensure they understand their personal impact on the business and the business’ potential impact in real time (positive and negative) on them.  Compensation schemes may be adjusted to better reflect the realities of the economy, and to tie compensation to desired performance.  Re-organizations to help people focus on the specific strategic objectives at hand, can help, as well.

6.    Refine your Strategy to Define How you will Accomplish the Revised Goal, Given Current Economic Conditions.  It is important to get the entire team aligned and focused on the same priorities, especially when business is more competitive.  Who does what differently, when, where, how, and why?  How will they be held accountable, and how will they be rewarded? 

7.    Tweak the Brand Message.  It takes time to build a brand.  Customers and prospects brand you; you cannot brand yourselves.  We can merely influence the perspective that users have of our brands.  In a down economy, the message may need to evolve subtly to convey a real change in buying behavior.

8.    Forecast the Worst Case scenarios.  In order to be better prepared than competitors, it makes sense to think about the Wildcard scenarios that may occur in your industry, and then develop a planned response should they occur.  Doing so will make you more confident in the short term, and potentially more successful should disaster strike in the longer term.