Strategy Execution Life Cycle – All six phases of Guberno’s strategy execution lifecycle
Background context – An engineering consumables business has supplied the mining industry successfully for over 100 years. As an aftermarket supplier of mining consumables the business competes against a few very large Original Equipment Manufacturers (OEM’s) that have an inherently strong market position. Despite being an established brand in the supply market with a long track record of innovation and quality delivery, the business was struggling to identify and deliver growth as per the expectations of its shareholders.
Strategic Challenge – The business was undertaking a medium-term strategy and planning process with clear shareholder objectives to grow and improve the quality of the business. The strategic challenge was to identify potential growth frontiers and develop compelling investment strategies to deliver against these shareholder objectives. Growth would need to be achieved in a low growth demand environment and in a competitive context where OEM’s were increasing their participation in the mining consumables supply markets.
Strategic Activities – Guberno provided strategic advisory support to the leadership team as they developed a growth strategy and execution plan for the business. Key activity workstreams included;
- Strategy foundations – understanding and seeking alignment around the operating performance of the business and its positioning in a changing competitive landscape was a key launchpad for the strategic thinking journey. Engaging with a range of stakeholders to articulate and describe a desired future state helped define the strategic gap to focus the strategic planning process.
- Strategic option generations – through an engaging process involving a diverse group of business operational and functional leaders a range of growth frontiers were identified and explored. This included new opportunities leveraging core capabilities, exploring core capabilities in new geographies, and adjacent opportunities to the core business.
- Prioritising growth frontiers and developing investment strategies – a structured process narrowed down the available growth frontiers to a smaller number of prioritised opportunities. Cross-functional leadership teams worked through investment strategies to deliver credible capability platforms to deliver against the growth potential. Each growth option was presented and debated by the leadership teams in a ‘shark tank’ like environment where each of the investment strategies were stress tested.
- Business planning – translating opportunities to executable capability plans was the key link from strategy to business planning. Identifying key resources and capabilities to deliver the plan was a key focus of building credibility amongst shareholders on the deliverability of the growth plan.
Outcomes – The business developed a compelling strategy and plan to deliver a step change in growth and an improvement in the quality of the business. Importantly the business established a detailed and prioritised investment strategy that was presented and endorsed by the Board.
Key Learnings – The project was an ideal case study for the power of disciplined and structured strategic planning processes. Developing strategy does not need to be a complex process – but it is a process. Aligning leaders around the realities of the current state relative to a desired future state describes the strategic gap. Harnessing diverse thinking to identify alternative pathways to bridge the strategic gap is a critical precondition to selecting a preferred pathway amongst the alternatives. Ensuring a capability platform exists to deliver the preferred strategic pathway with discrete actions and plans is key to executability. A clear strategy and plan that is the outcome of deep leadership engagement throughout the development process is the key ingredient to effective strategy execution.