First things first, guiding principles are central to having an agile strategy. So when we say guiding principles, another way to think about the topic is guidelines for decision-making for your team.
How to Keep Focus with Your Guiding Principles
Oftentimes, the minute that the “ink” is dry on a strategic plan, there’s a new opportunity, a new dynamic, a new something that’s going to come out of left field that’s going to upset the focus that you’ve created in your strategic plan. So, what do you do about that?
Pulling Guidelines Out of Your Strategic Planning Process
One way to address this issue is by having an agreed-upon set of guidelines or guiding principles that help keep your strategy alive and agile. Guiding principles are not values, as values are behaviors. And they’re not actions. They’re guidelines that help decision-making. They address the challenge. And the most important thing, if you sit down with your executive team and you say, “Let’s develop some guiding principles,” it’s never going to work. Listen for the guiding principles that will inherently come out of your planning process. Just pay attention and keep a list of guiding principles running on the side.
“We Will….” Statement
Here is a stem completion that will help you know whether you have a guiding principle instead of a value or an action: “We will…” So, to put this to work, define your problem or your challenge. Any great strategic plan has a mega challenge or problem or maybe mega opportunity to solve. So, in this case, a simple one might be, “How do we maintain profitable growth?” And to do that, what will our “We will” statement be? When creating your guiding principles, keep them to less than half a dozen statements that will be targeted on solving this problem.
Principles to Put in Place
What are some principles to put in place? Here are some examples:
- Focus: Only pursue one opportunity or field of play at a time.
- Intent: What is your intent? Maybe it’s growth over profitability, or you may actually prioritize profitability over growth.
- Return: Set a timeframe for your minimum expectation for cash flow. Maybe it’s three years, or maybe it’s five years.
- Impact: You might have a guiding principle for impact, meaning “something” is co-equal to profit. What is that “something”? Maybe it’s employee satisfaction, which would be co-equal to profit. In other words, don’t pursue things that deteriorate your employee’s satisfaction.
- Core: What is the “core” of your business? Ask the question, “We will always choose XX over XX. Or for example, “We will always choose our core business over new business.”
Those are just some examples of how you might keep your strategy alive when new things come in front of you and your team. There will be some new decisions to make, knowing that you have a challenge or problem to solve, but you have some guidelines that will help keep your strategy agile. For more information on this topic, check out the master, Richard Rumelt, and his book, “Good Strategy Bad Strategy,” where he goes into a lot more detail on this subject.