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Berkonomics

Strategic planning: Strategies and tactics

                In past insights, we explored the need for a tangible goal and strategies that are measurable as steps toward achievement of the goal.  This insight calls to account tactics to accompany each strategy, and even suggests a number for each. 

                Tactics support strategies and allow your individual managers and departments to contribute to strategies in measurable ways that are more short term and procedural than are the strategies they support.  Tactics change frequently as achieved and may be updated or replaced during a year when achieved, unlike strategies which often span a number of years.

                Five tactics to support each strategy seem a fair, even if arbitrary number.  Tactics direct each department in very specific ways.  Here are several examples of tactics from my recent experience with companies where I serve as board member. 

[Email readers continue here…] 

Strategy Three: Expand into at least three new continents through new distribution channels.

  1. Sign one distributor by June of this year in each of three major geographic areas. EMEA, Asia, Latin America.  Each distributor to be capable of generating $1 million in business by year two.
  2. Assign development manager to localize design and oversee needed enhancements to product and support materials for each new territory.
  3. Train and transfer technology to each new distributor within 90 days of signing.
  4. Assign one corporate employee to support sales and installation efforts by all distributors.
  5. Seed demand in each new territory with at least two corporate marketing events in partnership with each distributor.

Note that each of these tactics directly support the strategy, are measurable and assumed to be achievable, bought into by each department effected by the tactic.  Note that the strategy calls for cooperation between business development, sales, marketing, product development, installation and support.   This is a great way to unify departments that once may have competed for resources toward individual ends, now pointed toward a common goal supported by all levels of management up to the CEO.

        In planning, the matrix, “5×5=1” is a good memory tool for management to keep from overreaching with too many strategies and too many tactics.  But it is not written in stone.  And development of these important elements of the plan should be made using all the resources available, from your board of directors to your senior management to departmental management. Getting all to buy into each step may not be easy, but when accomplished, is a powerful and invigorating opportunity to celebrate, then to get to work as a functional unit of the whole.

  • Dave,

    As ususal, great insights on business. And, from and Angel perspective, very good guidelines on what is needed in a venture to create significant shareholder wealth.

    Out of curiosity, what % of CEOs in established business do you think utilize the methodologies you describe ?

    Further, what % of Founders in young companies do you think have or are developing their skills to manage the business along these guidelines ?

    And finally, what % of early stage investors do you think add value by establishing this structured, disciplined approach to decision making in companies where they have an interest ?

    Regards,

    CAIL

    Ron Thompson

    • Ron, good questions. I am sure there are no statistics to respond with. But I for one make it a priority with every board of mine to perform a strategic planning exercise, usually offsite, at least every other year. I use the format I’ve noted in this blog. Some call the tactics “KPI’s – key performance indicators”, and other use methods that accomplish the same end with different tools. The take-away is that all angel or VC board members should push for planning and buy-in by the board and at least the senior members of the management team through the director level, of not all the way to the receptionist…

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