Background
For entrepreneurs attempting to craft powerful strategies, it’s extremely important to conduct an analysis to give you the necessary frame to match your strategy with your internal and external circumstances. This blog guides entrepreneurs through a path of creating a strong analysis to support your strategic planning efforts.
Framing the Analysis
Previous blogs (https://ventrek.com/latest-news/what-is-entrepreneurial-strategy/) described entrepreneurial strategy as “the allocation of resources toward activities that lead to a desired outcome”. This is the essence of entrepreneurial strategy and it is important to craft strategies that are in context with your strategic circumstance. Strategy must be crafted in the context of key internal and external factors or you risk creating a strategy that just doesn’t work and does not address critical items to help strengthen your company. An effectively conducted analysis will give you the important context and clues to craft a powerful strategy for your company.
Conducting an Analysis
To conduct a strong strategic analysis, we recommend three distinct analysis: 1. Review Year, 2. Start-Stop-Keep Doing Exercise, 3. SWOT Analysis (strengths, weaknesses, opportunities, threats). This is the minimum set of analysis. For companies that are already strong at crafting strategies, we would also add deep dive analysis items such as Diversified Company Analysis, Blue Ocean Strategy, Hedgehog and Flywheel Analysis and other more advanced analysis techniques. For now, we will stick to the core analysis which still offers a solid framework for building out your strategy.
Prior to your actual strategic planning session, we do recommend pre-session work. Ventrek uses a template with our clients that is filled out about two weeks prior to a session. We recommend you do the same. The template is sent to the leadership team and asks the following questions:
- What are the top misses for the year?
- What were the top hits for the year?
- What should we start doing as a company?
- What should we stop doing as a company?
- What should we keep doing as company?
- What are our top strengths that we can try to leverage?
- What are our top weaknesses we should try to eliminate?
- What are some external opportunities we should consider capitalizing on?
- What are some external threats that we need to try to mitigate?
For the SSK questions, we strongly encourage you to solicit input from as many staff as you can AND from key clients/customers. This is incredibly important in gaining valuable insights that you might otherwise be blind to.
Once you’ve got the pre-session results, just collate all that data and have it ready for the session. During the session, through various techniques such as voting, your goal is to isolate the most salient analytical items. Less is more in strategy! You cannot fix everything in a one-year strategic plan nor should you. Your goal is to conduct an analysis that help’s you focus on those critical items that will move your company forward and continue to strengthen it. We recommend the top three only in each category.
And, this is very important. As you move through the analysis DO NOT repeat items from a previous section. For example, say you identified a top miss for the year as ineffective recruitment efforts. In late sections, such as Start Doing, you would not repeat that item (we need to start doing better recruitment). This is a waste of analysis space and is not effective. Look for original ideas for each section – this is where the richness comes in for the analysis. It is also important to frame opportunities and threats correctly – these should be EXTERNAL to the company. For example, an threat is not “people leaving the company”- no, that’s an internal weaknesses. Opportunities and threats are external – thing macro (the world), your industry, your competitors. Often this includes government opportunities and risks as well.
Next Steps
Once you’ve completed your analysis (which, by the way, should take about 2 hours max), it’s time to move onto crafting your strategy. Some of our other blog posts help you with this (https://ventrek.com/latest-news/creating-impactful-strategic-objectives/ and https://ventrek.com/latest-news/building-powerful-quarterly-strategic-rocks/). We also strongly, strongly recommend two other things. First, we recommend you share the summary table with your staff and team (of course, cleaning it up for any sensitivities). This drives cultural buy-in and strategic awareness with the rest of the company. Second, and this is important, for each quarterly monitor session you do (we will explain this is a later post), you must check back on this analysis to map progress through the year and identify any other issues. We use a technique call green/yellow/red. For each item, ask, “have we resolved this issue fully (green), partly (yellow) or not at all (red).
Conduct a strong, effective analysis is critical in building great strategies. Strategy must be crafting contextually and this analysis description should help you.