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This article gives an overview of #StrategyOS and then describes the approach used in our Strategy Choices Workshops to Envision your business future. It’s a little longer than most to allow for a good overview of how to get started with StrategyOS and create a focused Positioning, Strategy, and Plan for the coming years.

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Strategy OS has 3 key activities:

• Envision: Define the enduring properties of the business and how they will be achieved in the medium and near term. This is where to start with StrategyOS and the focus of this article.
• Transform: Execute the strategy on a daily, weekly, and quarterly cadence to create changes that make progress toward the company’s strategy and positioning. This phase delivers business success as shared here.
• Adapt and Grow: Review progress regularly to assess success and improvement priorities and to understand what thematic changes are needed to grow and stay relevant. It includes an (at least) annual refresh of the Envision elements and practices to stay attuned to your business Context.

Definitions:

Before we dig into Envision, it is helpful to review a few definitions. Your StrategyOS must have a defined Business Model on which it works to implement, grow, and improve. The Business Model is first created in this Envision phase and consists of the following elements:

On the right side of the above diagram is the hierarchical list of elements that define your Business Model. As we go down the list, we are getting more near-term and more detailed.

• Positioning terms are the elements that are ten-plus years out and should endure time, technology, and people in the organization. They define why the business exists.
• Strategy terms are two to five years out and create a picture of how to build toward your vision within a timeframe that can be reasonably imagined.
• Plans are made annually and quarterly to guide what to do to achieve the Strategy through daily, weekly, and quarterly actions.

All of this projects on a shadow of the Context that impacts strategy through internal resources and capabilities relative to external trends like customer needs, competitive positioning, and social and regulatory limitations. Your strategy must define how you will compete to win within this Context through your product market fit, go-to-market activities, and resulting business processes and policies. More on this in the Go To Market Theme when we Tune Strategy.

The left funnel is the People Practices of the Business Model which I’ve previously detailed here.

Overall Approach:

When first starting to practice StrategyOS, I work with leaders across the business to define their Business Model in a Strategy Choices Workshop. This is a series of work sessions that allows leaders and influencers in your business to give input and share ideas. It produces a better result than any individual can create and builds needed buy-in through the process. If you’re working to self-implement, I suggest adopting this workshop approach. Some best practices are:

• Ensure ownership and commitment from the CEO or owner. He or she will have selected their strategy operating system in Step 1 and started sharing the approach with workshop members.
• Schedule in advance to allow pre-work and to clear calendars for the effort that is free from distractions.
• Allow 1.5 to 3 days to work through the Envision Steps with the workshop team.
• Develop the business model elements through group exercises like brainstorming, nominal group technique, and voting to generate collaboration and build consensus.
• Build time into the agenda to allow for transfer of information to the Business Model Worksheet and Score Card for review and wordsmithing.
• Allow time after the workshop to refine outputs and continue to execute StrategyOS.

A typical agenda for the workshop looks like this:

Following the Strategy Choices Workshop, I work with the leadership team to ensure they get good at the Transform phase. Daily and weekly progress on your business model is necessary to ensure priorities are a regular focus of the management team and that progress is not overshadowed by the daily running of the business. Through a Strategy Execution with Rhythm Audit leaders get insight and practice on how to establish a StrategyOS execution rhythm on a daily and weekly cycle. We then focus on running effective Leadership Team Team meetings and implementing the other 8 fundamental practices of StrategyOS.

Further support can come from Strategy Refresh Workshops to get practice on the regular checkups and renewals needed. In this workshop, teams review their progress from the last quarter, set new Rocks and Goals for the upcoming quarter, and work on important decisions and Issues to accelerate results. The annual workshop adds a review and refresh of strategy elements and annual planning.

Envision Phase Steps:

1. Commit to a System:

Much like in AA, the first steps to success are to admit you have a need and to accept that there are systems that have delivered the results you are looking to achieve. The strategic operating system that you choose must be made explicit to create buy-in, a common process, language and tools, and shared accountability to make the system work.

The idea of strategy as an operating system that links planning with execution and feedback is not new. The concepts have been developed and repackaged over the years by many academics, practitioners, and writers. Each has a little different focus and different terms, but share common elements. The most important factor to success is to create one that works for your business and people.

StrategyOS as presented here is borrowed and blended from tested ideas that fit most businesses that have at least a few employees and some customers. I typically modify it depending on company maturity and size as you might do for your business. Or, you might pick another author’s “pre-packaged” system. Popular options that are built into StrategyOS include:

• EOS from Gino Wickman’s Traction is a fairly lightweight way to add a common system.
• Mochary Method from The Great CEO Within documents an approach especially for companies that are starting to scale.
• Lean Strategy from Erik Reis’ The Lean Startup book revolutionized MVP and pivots as a path for startup success.
• Strategy Canvas from Kim & Mauborgne’s Blue Ocean Strategy offers differentiation ideas.
• Balanced Score Card from Kaplan & Norton’s book by the same name offers structure for mature companies.

Pick a system or modify one to fit your special needs. Agree to diligently follow it (at least among your executive team.) Publicly commit to it as your strategy operating system. Share it across the organization to create a common process, language, and tools. Follow it to communicate and hold each other accountable to an ongoing strategy process.

2. Define Positioning:

Positioning includes the business model elements that should be rock solid: Mission (sometimes called Purpose), Values, and Vision. These guide key choices and help to give direction when uncertainty arises. When you get them right, you can carve them in stone to endure beyond anyone’s tenure in the business.

You may already have positioning statements documented for your business. If they serve you well, you may not need to modify them. But, most businesses that are just starting to implement StrategyOS want to revisit them to ensure they are solid touchstones for at least the next 10 years and ideally indefinitely. If you are just getting started or stuck, look to other companies, brands, and people for inspiration. Here are a few examples:

To start, make sure you have a documented statement for each Positioning element as you start to implement your Strategy OS. Create your Values, Mission, and Vision in working sessions that allow key leaders and influencers in your company to give input. Document these in your Business Model Cheat Sheet. Test drive your positioning for a quarter and revisit whether it is serving the intent at the next quarterly meeting (Transform phase’s Execution Rhythm.)

When you have a couple of quarters with no changes, it is time to start making these statements the cornerstones on which StrategyOS is built and run. Publish them widely. Refer to them when evaluating all other components of your strategy and your people. Point to them for decision guidance.

3. Tune Strategy:

Strategy in this context refers to the dictionary.com definition: “a plan of action or policy designed to achieve a major or overall aim.” In this case, the overall aim is to achieve the Positioning created in the previous step.

A useful construct in creating your strategy is to organize around the major Themes that advance your Positioning. Themes are broader than plans or programs in that they offer guidance about what is needed without limiting possible plans of action or timeframes. They are destination statements describing in detail what the business looks like at some future date from a variety of perspectives. Since it is difficult to envision a clear future much further out than about 3 years, use this as your timeframe to create destination statements describing your major next achievements. Make these statements challenging and motivational but within the realm of possible outcomes.

These destination statements come from assessing how you can best use your business talents and unique capabilities to win given the business’ Context. SWoT analysis, competitive positioning, customer segmentation, adjacent markets, best practices, 5-forces, value chain, and internal gap analysis are some of the many ways to generate Theme ideas. Even more important than these approaches, get really good at talking to customers, employees, and partners. Regularly share issues, ideas, and insights about what can drive success or hamper achieving the vision from these conversations.

From the universe of possible destinations, group, prioritize, and focus on the top 3 to 5 (no more than 7) that can have the largest impact on success. Give them short titles that become your Themes.

Once you have your priority Themes, ensure they are well understood by giving each at least one descriptive Outcome and a Measure that demonstrates attainment of that Outcome at the end of the planning horizon (similar to OKRs, but start with a longer time horizon.) This process helps make the Theme more concrete and allows the right focus of resources needed to achieve the Theme. Be flexible; as the example suggests, some Themes’ Outcomes may be less tangible than specific measures in this planning horizon. But it should always be easy to determine whether the Outcome was achieved or not.

Every Strategy must include two specific Themes: Your “Go to Market” and “Financial” themes.

The Go to Market or marketing Theme is how you will sell and win business within your Context. If you need a structure, borrow from what is described by Wickman (pg 55-65.) The elements are summarized with examples below:

The Financial theme defines your revenue model and includes at least two associated Outcomes: revenue and net margin with associated Targets. As you learn key drivers of your financial results add them as leading Measures to give early indication of success. Elevate these measures to the Financial Theme and give them Outcomes and Targets matching your strategy time frame. Finally, you must ensure the company never runs out of funds to operate. Cash management and fundraising are essential parts of the Financial theme, especially for early stage companies.

Add these Themes, Outcomes, and Measure elements to your Business Model Cheat Sheet.

4. Annual Planning:

Annual planning, as the name suggests, involves envisioning the company one year out and setting Targets and Initiatives for the next 12 months. This step works much like the exercise in step 3, but the timeframe is narrowed to one year and more detail is added to create clarity of focus for the next year about key results that will work toward the strategy Outcomes.

Stay lightweight. Planning can be as simple as creating Initiatives and Targets for each Theme created in Step 3. From a brainstormed list of possibilities, group, prioritize, and focus on the top few Initiatives and Targets that can have the largest impact on success. Assign primary owners and give them a Budget that includes people and dollar allocations.

The outputs from Annual planning should be tracked regularly on the business’ Score Card. Themes are good for organizing your Targets. Have two or three of the most important metrics that show performance for each theme along with associated Targets and Goals grouped by Theme.

Create Goals and Rocks for the next quarter in the Strategy Choices and Annual Planning workshops (even though they are technically a Transform Step) so that you’re ready to start with Execution Rhythm the next week. Add quarterly Goals and Rocks related to each Theme to the scorecard. Showing Rocks color-coded indicates whether or not they are on track. Often reaching a Goal requires having a Rock complete. Each Rock and Goal has an owner. Each person on your executive team should own 1 to 4 in total. These are then refreshed in Quarterly (or more frequent) Recurring Refresh meetings.

All plans come with risks and uncertainties. Creating plans is a good time to raise known or possible Issues that could impact your ability to deliver them. The Issues list is a key tool for decision making, barrier removal, and problem solving. You might solve some high priority issues in your annual planning. Most Issues are managed by keeping a priority list that is worked on during Execution Rhythm meetings as discussed in the Transform phase.

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What questions do you have about getting started? How well will the efforts in this year’s plan support your long-term vision? How prepared are you and your team to implement your plan at the start of the New Year?

Please feel free to reach out if I can help you build more rigor around delivering business success. I can also share exercises for your team to use to develop Envision elements for your business.

May you find Passion, Joy, and Freedom in all life’s adventures.