• Redesign and evaluate your strategy

    Rethink your business in order to become future proof. Redesign your strategy through developing he oustide in journey of a customer wanting to do business with you. It helps to map every step and define touch points in the so called customer journey. You will be surprised how many obvious moments that you take for granted are highly sensitive for your customers. We have developed the strategic experience journey where you can choose the parts that you think are necessary for you to follow in order to make yoyr customer strategy robust for the future. 

    Strategic Experience Journey

    A strategic quest for value creation 

    Introduction

    Top managers have to deal with turbulence on many fronts. Financial scandals are causing a breakdown of confidence in companies and nervousness on the financial markets. Among other things, companies must cope with continuing globalisation, the demand for more sustainability in business operations and a growing cultural diversity.

    We believe that one thing is completely clear: strategic renewal of organisations is the only way to ensure continuity in the long term. Renewal ensures singularity, albeit temporarily, creates market opportunities and increases the strategic competencies. This enables a company to continuously cope with all types of turbulence.

    In practice, however, it does not appear to be easy to set up an organisation that continuously renews itself. There is often an area of tension between exploitation and exploration, and strategic renewal is often a matter for a select group of top people. Nevertheless, strategy cannot be reserved for the happy few. Co-creation specifically means that many people must be involved, contribute ideas and creativity, and actually be touched by the process.

     

    This co-creation is the basis of our approach for strategic renewal: the ‘strategic experience journey’. It is a structured quest that provides room for rich imagination from everyone, but in which a structured assessment of opportunities also takes place. The philosophy behind it is that the future cannot be predicted, and that learning your way into the future is the only way to produce effective renewal.

    During the past decade, we have gained experience with the strategic experience journeyin numerous variations. This white paper is a reflection of those experiences. We first briefly examine the most important stepping-stones for this journey, and then we discuss ten essential areas of attention that are significant for strategic renewal.

     

    On the journey for strategic renewal; Nine stepping-stones...

    The journey for strategic renewal is a structured approach, in which a number of fundamental subjects are reviewed. It is a complete approach with its focus on the co-creation concept.

    The strategic experience journey comprises nine stepping-stones that should be studied in connection with each other. The figure below illustrates this strategic experience journey. The blue blocks represent the stepping-stones.  The yellow blocks relate to the process. This section explains the blocks in more detail.

    Trends, Economic motor, Culture, Core competencies , Sector analysis           Strategic intent ,Innovation, Strategic architecture, Organisational model, Milestone planning, mobilisation of engagement

    Trends and discontinuities

    Organisations are continually exposed to the dynamics of the market and environment in which they operate. It is important that they identify the macro, meso and micro trends, and assess the consequences of these trends for the organisation. The identification of these developments is important because they can lead to different demands from the organisation’s existing customers. The developments can also bring in new customers who can be served with existing or different products and/or services, and/or experiences, which had not previously been considered.

    Sector analysis

    The sector analysis highlights developments in the sector. This means drawing the contours of blurring boundaries, convergence and integration within the sector. This includes potential horizontal competition, the breaking open of chains and the emergence of chain companies.

    Core competencies

    Core competencies are identified in order to gain insight into the current power of the organisation and to search for opportunities to better utilise this power, to develop new competencies or reinforce existing ones.

    Economic motor

    The economic motor identifies the strength or vulnerability of an organisation. The existing business model and the current and future profit makers are assessed. In doing so, the analysis is expressly not restricted to just the financial income, but also covers the reputation and social contributions. In addition the reasons that customers buy or continue to buy from the company are examined, the vulnerability is analysed and alternative business models are outlined.

    Culture

    By analysing the current culture and generating insight into unwritten rules and core values, an overview emerges of the supports and obstacles for the achievement of the organisation’s ambition. This enables specific recommendations to be made on how to tackle the obstacles.

    Innovation

    The information that emerges from the preceding stepping-stones is correlated here. The opportunities for the organisation are examined. Opportunities in the fields of markets, products and services, experiences, organisational renewal, improvement of skills and behaviour, alliances, and suchlike.

    Strategic architecture

    The strategic architecture is constructed of directions for strategic growth. These provide guidance to the development of products, services and the communication. The fundamental customer requirements form the basis for the directions for growth.

    Strategic intent

    The level of ambition for the coming years is recorded in the Strategic Intent. The intent contains not only the economic offering (experiences), but also the core values of the company and challenging goals for the future.

    Organisational model

    The realisation of the organisation’s goals requires management and organisation that are aimed at achieving them. Adjustments in the direction and/or ambition of an organisation therefore often lead to modifications in the management model and organisation model. For example, the management may need different management parameters, additional competencies may be required in the organisation, or departments have to be given a different role in the organisation. The drawing of the main lines of the new organisation model is a first step towards implementing the strategy.

    Milestone planning

    Finally, in the plateau planning, an overall plan is prepared for how the chosen targets and opportunities will be realised. This plan contains specific deadlines as well as the steps that must be taken to hit the deadlines.

    Singularity

    The journey provides a number of results that form the foundations for future growth. For example, a new business model, new directions for growth, more focus on specific core competencies, an ‘offer of experience’ or a new organisational set-up. Briefly, the result is not only more singularity, but also increased sales on the basis of newly developed market opportunities, clarity about strategic alliance partners, etc. In addition, there is a supported strategic plan and the strategic competencies of key officials have been further developed.

    Mobilisation

    The nine stepping-stones identified form an important part of the journey for renewal that leads to the company’s singularity. However, these stepping-stones do not explain the process of co-creation. Co-creation is about how organisations elaborate the stepping-stones. It comprises the process of strategic renewal that mobilises and involves the staff in the organisation and in this way clears the path for implementation. The journey itself is also designed as an experience, which is examined in more detail in the following section.

    Co-creation: the key to success

    Areas of attention for co-creation.

    Co-creation is an intensive process that involves many of the organisation’s employees. Co-creation means that the strategic renewal is no longer a matter exclusively for the top management. The process takes place with people from all layers of the organisation.

    The strategic renewal process must be designed differently, basically because many employees must be involved in it. Our experience teaches us that there are ten lessons that lead to successful implementation of strategic renewal.

     

    ... Create a process of simultaneous improvement and reinvention...

    The life cycle of a company is the same as that of a product, following an S-curve. The most significant difference between the S-curves of a product and a company is that the average length of a company’s cycle is a multiple of that of a product. A Shell study shows that the life cycle of a company is usually not longer than 30 years. Only a minority of the businesses succeeded in stretching the life cycle to 100 years or more by changing core functions.

    Organisations can guarantee their continuity by lengthening their current S-curve with new product variations or new sales markets. Frequently, however, companies are forced to reinvent themselves, because of disrupting technologies, new competitors or products, and have to switch to a new S-curve. The challenge is to both lengthen the existing curve and at the same time go and find the next curve: be bifocal.

     

    Insist on a different idea about strategy...

    In view of the events of recent years, including mega-mergers, new technologies, problems in the telecom sector (KPN, Lucent, Worldcom), the bursting of the internet bubble and financial scandals (Enron, Worldcom, Ahold, Arthur Andersen), it is vital to think about strategy differently. In such tempestuous times, strategy formulation solely at the top of a company is doomed to fail. This traditional idea presumes that all the wisdom is inherent in the top management, which makes and sells the vision (tell & sell).

    A strategic renewal process nowadays requires co-creation. We therefore prefer to speak about strategising to underline the active and co-creative character. With strategising, vision emerges in dialogues between many people, both within and outside the company’s own organisation. The top management must ensure that people are listened to and fell challenged to come up with new ideas. Analysis and implementation run parallel in the process and take place on the basis of in-depth understanding in many people.

    This view of strategy formulation has four significant consequences.

    •          Continuous business intelligence

    Companies must continually explore their environment, be constantly learning and thinking about future possibilities to be prepared for eventualities. Strategy development is no longer a predictable ritual that is re-enacted every couple of years, but a continuous process of scanning, thinking through and searching for answers. Only variety beats variety.

    •          Broadening the development of vision and strategy

    Top managers also do not know exactly which direction must be taken, and that makes them insecure. Knowledge and experience is present throughout the entire organisation. Therefore, only a broader development of vision and strategy has any chance of success. After all, knowledge workers want recognition of their knowledge and experience, they want to be involved in strategy development and important change processes.

    •          Stability at value level

    A strong business portfolio, robust structures and processes are no longer any guarantee for continuing stability. The altering environment subjects them to a continuous change process. Only deeply embedded organisation values offer more stability. The formulation and proper discussion of core values provides the organisation with a compass without it becoming a restrictive strait-jacket.

    •          Reconciling dilemmas

    Strategic dilemmas and paradoxes emerge every day. Competition versus cooperation, mass production versus tailoring, price strategy versus market-share strategy, organising centrally versus locally, etc., etc. The search for reconciliations to these types of dilemma is increasingly important to achieve actual renewal. This is how the concepts of co-optition and mass-customisation emerged. The process that is continually performed is: being aware of the dilemma, respecting each other’s opinions and searching with one another for the reconciliation or surpassing of the dilemma.

     

    ...Develop new perspectives...

     

    The third lesson is the necessity to develop new perspectives. Staff at all levels of in the organisation must learn to think in terms of trends and discontinuities and, moreover, learn to interpret these trends. Discover patterns in the multiplicity of trends, make sense of the information, draw conclusions for the company’s own organisation and learn from each other’s interpretations.

    Because people often get bogged down in daily matters and routine, it is important that this trends exploration process is organised separately. Staff must be challenged to look beyond the sector boundaries, look further into the future, and look more broadly than they are accustomed to. For example, this means that they don’t just talk to customers about the existing services, but also talk about developments in the customer’s sector. For a fresh outlook, however, ‘going outside’ is a requirement. Attending a lecture about IT developments has much less impact than an intensive company visit in Silicon Valley. A complete immersion penetrates better and leaves a longer lasting impression.

    ...Challenge preconceptions...

    Preconceptions must be challenged. What people have learned at institutional level, often with difficulty, they do not give up easily. It has become a part of them to view the market, customers and working methods in a specific manner. This has to be broken out of in order to be receptive to new opportunities and ideas. What can be done?

    •          Generate diversity deliberately. By arguing both from outside inwardly (consequences of trends) and from inside outwardly (core competencies), new points of view often emerge. By working both top-down, bottom-up and diagonally, new conversations are created. A fresh outlook on existing situations can also emerge from connecting internal and external parties with each other, and by involving usually neglected groups (young people, newcomers, staff in the periphery of the organisation) in the process.

    •          Challenge ‘deeply held beliefs' about customers, markets, products and ways of doing business. Break taboos. Don’t restrict thinking to the current market but assume the entire conceivable market (example: children’s market for disposable cameras). Don’t just think functionally, but also fashionably (example: Swatch) or consider entertainment (example: Nokia).

    •          Re-examine the business model. Be receptive to alternatives. For example, a consultancy firm can earn money not only using the `hourly billing model', but also on the basis of no cure no pay, with the sale of knowledge on CD-ROMs or in books, performing as gurus, payment in shares, a digital service for advice, or the creation of experiences.

    •          Confront yourself with customers’ complaints and irritations. Try to remove compromises that customers feel that they have to make daily when purchasing services. Example: wanting to pay more quickly at a filling station; solved with Easy Pay system.

    •          Consider the role in the value chain. Which role in the chain will soon add the most value? Are the competencies available for that role?

    •          Consider the business portfolio. What will be the future core activity? Example: retailers starting to provide banking services, DSM changing from bulk chemicals to fine chemicals.

    These are only a few possibilities for challenging preconceptions. It is important to keep an open mind and not to avoid, but rather encourage critical questions.

    ...Increase emotional intelligence...

    A lack of emotional intelligence is one of the major obstacles in the path to achieving a strategic renewal process. In short, this involves the capacity for:

    •          Reflecting

    Being able to take a step back from the current situation, both mentally and emotionally.

    •          Letting things go

    Daring to question one’s own preconceptions. If the strategic process is set up as co-creation (co-production**??), it will often seem that there is less control. However, the opposite is true.

    •          Talking in a permanent and honest dialogue

    With customers, with partners, with suppliers, with financiers, with staff.

    •          Experimenting

    Learning to cope with new types of innovation. Not putting put all your eggs in one basket and taking excessive risks, but by permanently experimenting in the market.

    •          Dealing with inter-cultural sensitivity

    Being able to respect lines of approach and ways of reasoning from other cultures and being able to deal with inter-cultural dilemmas that ensue from these. In companies that operate worldwide, this also means: bringing other cultures into the company’s top management.

    In order to use the collective IQ and EQ of the organisation for renewal, it is necessary to set up the strategic renewal process differently. In a participative model, co-creation means as many people as possible are involved in the process. Top management has the role of director and must dare to have faith in the proper outcome of the collective process.

    ...Stimulate out-of-the-box thinking...

    Out-of the-box thinking is vital to actually achieving strategic renewal. Therefore, wherever possible, idea killers must be eliminated. Staff must never have the feeling that they will be punished for each extraordinary idea. Special settings can even boost their creative thinking. This can be done by allowing staff some time to elaborate their own ideas, at one’s own discretion, or by supplying them with models to stimulate innovative thinking.

     

    ...Mobilise and communicate differently...

    It is understandable that, in practice, there are a lot of complaints about the communication surrounding strategic renewal. After all, the cascade model is popular: unit and department managers have a set of PowerPoint slides stuffed into their hands for explaining the developed vision and strategy to their people. The result: a few managers do this well and enthusiastically, but most of them don’t do it, do it too late, with cynicism, or without enthusiasm. Little or none of the message comes across and the potential enthusiasm and commitment is nipped in the bud.

    To ensure that renewal takes root in the organisation, the Large-Scale Events method is used during a strategic experience journey. At various times, large groups of staff, sometimes hundreds, from all levels and functions are invited to interactive sessions. At these, they receive information from the top managers and from various study groups, have a dialogue about the details and their interpretations, or are inspired by external speakers. There is also room for an intensive exchange of ideas about issues, trends, customer requirements, scenarios, competencies, opportunities, growth directions, etc. The participants can put questions directly to the top management. During these sessions, shared views and interpretations gradually emerge, through which the involvement in the process and the results of it substantially increase.

    ...Support the process with specific skills and technologies...

    A strategic experience journey is supported by several specific skills and technologies. The most important of these is the dialogue technique. The study groups that participate in the strategic process are trained in the art of thinking together. There is a world of difference between a dialogue and a discussion. The essence of a successful dialogue is that participants can actively listen, can and dare to give their real opinion, can postpone judgement and respectfully put up a fight.

    Another skill is accelerated learning, based on the theories of Howard Gardner. According to him, people have seven intelligences: visual, rational, linguistic, musical, intrapersonal, interpersonal and kinaesthetic. Everybody has a learning style with different accents corresponding to these intelligences. Learning situations during study group sessions or large-scale events are designed to take these differences into account. That substantially improves the impact, and the information is retained for much longer.

    Group decision support software, also known as Groupware, supports interactive brainstorm sessions in small and large groups. In addition to a central projection screen, every participant has a laptop in front of them into which they can pour their own ideas and see ideas of others. The advantage of this method is that there are no barriers to everyone providing input - because it is anonymous - so that there is a focus on ideas that is independent of the person who suggests them.

     

    ...Create sustainable vitality...

    A strategic renewal process is never finished. In order to survive turbulence, an organisation must possess the flexibility to repeatedly review new developments and actively respond to them. The implications of this are:

    •   Focus on continuity. A short-term focus and unilateral pursuit of shareholder value is too lopsided. A dynamic balance between all stakeholders is vital.

     •  Sustainability. People, planet and profit as basic principle for the business operations. Examples: The Body Shop, DSM, Xerox with waste-free products.

     •  Passion and potential of individual staff members being fully utilised, by ensuring that they feel both comfortable and challenged. Discuss discrepancies between their own ambitions and those of the organisation. Enthral good people rather than enslave them should be the HR policy’s theme.

    •   Operate driven by values. Manfred Kets de Vries leaves no doubt about this: `Ultimately it concerns the meta values of fun, love and meaning, which keep an organisation healthy and constitute a counterbalance to the fear-driven behaviour that is often present.' These elements combined provide a strong sense of identity and coherence for the members of the organisation.

     

    ...Strive for challenging and helpful leadership...

    The role of leaders in the strategic renewal process contains a paradoxical task. On the one hand, they want to make their organisations reliable and efficient in order to be able to respond to external developments. On the other, they must allow uncertain innovation in order not to lose the commercial battle. Prof. Ives Doz van Insead’s management model provides a good guide for understanding the leader’s role in the strategic renewal process. 

    Four roles of the leader in a strategic process

    Stretch Instead if removing pressure for innovation, leaders actually expose everyone to external pressure and developments. On the basis of trends and developments, they pose continuous questions (and provide no solutions). They set challenging goals and targets.

    Discipline Furthermore, they require disciplined behaviour. There is feedback and checking where it concerns the performance or implementation of innovations.

    Support Conflicts are not suppressed, but are made constructive. Leaders focus on the issue of what people can learn from each other, and provide opportunities for training, education and coaching.

     

    Trust A climate of trust requires open communication, integrity and consistency between values and actual behaviour. Such a climate has room for strong feedback.

    The leadership style that is found in companies that have been successful for a long time is a combination of professional will and personal humility.

    Collective journey

    It will be clear that the strategic renewal process has changed into a collective journey, that provides singularity and value creation. A journey during which many experiences are gained and new directions can be followed.

    Companies that also want to excel in the future can no longer suffice with the traditional method of strategy formulation, but have to prepare for and plan the journey: the strategic experience journey.