Strategy in Action

This week I had a very enjoyable day facilitating a couple of sessions for the tax faculty of a reasonably large accounting firm. During the introductory session the faculty head put up the strategy statement and said, rightly, that organisations that stick to their strategy do better than those that change it frequently.

When I was doing my MBA, strategy was a concept that I struggled with at first. I read more strategy books than any other subject and I talked about it ad nauseam with my classmates, because I didn't really understand it at first and it takes a while to see how it influences an organisation. Strategy is the direction given to an organisation. It is the yardstick against which all plans, projects and activities are judged. In a well run organisation the only activities that are undertaken are those that directly support the strategy, and being a firm of accountants this is a well run company.

The strategic statement of this accountancy firm basically said, (and I admit that I am paraphrasing for effect, I defy anyone to actually remember the statement from one viewing), that the firm existed to build shareholder value and put money in the pockets of the stakeholders, partners and staff. There was not one mention of the client or the customer.

As the day progressed we uncovered the issues that they felt were holding the firm back. They included, not understanding their customers sufficiently to be able to cross sell services or respond to changes in customer circumstances, not being able to easily upsell their services and being stuck in the lower value transactional work such as preparing tax returns. Some of the reasons given for this were not talking to their customers often enough, sending emails and 2 sentence letters rather than picking up the phone and being driven by cost recovery rather than value add.

It struck me that this really was strategy in action. Actual proof that strategy really did work. By not putting the customer in the strategy, all the strategic blockages were coming from that direction.

Clearly the changes needed here are wider than simply changing a few words on a PowerPoint presentation, the organisational drivers, metrics and reward schemes will all have to be aligned. But here is one of the clearest examples of what to do to do better that I think I have ever seen.