If I asked your employees what your business strategy is, what would they tell me? What would they tell you? Well, you can ask them, and then tell me what they say. (I’ll post your responses here, anonymously of course.)
Last week, I concluded with this advice:
The three most powerful drivers for any business to improve performance are:
- STRATEGY: Develop a strategy based upon the value and results you create for your customers; not on your methodology.
- MANAGEMENT: Build a management team that can lead you to become double or triple your size.
- RESOURCES: Optimize your resources including cash, intellectual property, processes, and most importantly, information.
Today, I want to talk about strategy.
First, let me give you an example. One company I worked with shifted from being specialists at emergency equipment repairs for their customers to being proactive advisors on which equipment needed to be repaired and when it needed repairs. They went from reactive fixers, where the customer’s equipment was in control of their business, to proactive advisors, where they were finally in control of their own business.
This shift in strategy increased their value to their customers. They helped their customers to plan multi-million dollar maintenance budgets. They helped their clients to increase their equipment uptime, reduce breakdowns, increase through put, maximize return on assets, and increase revenues. They became much more valuable as trusted partners to their clients.
Right now, are you perceived as a trusted partner that increases business results? Or, are you just a vendor competing on price?
Your strategy is not only about what you do under your own roof or when you show up on site. It’s about the value and results that you create for your clients. It’s about increasing their revenue, improving their processes and quality, and strengthening their position in the market. It’s about your customer’s confidence that you contribute to their results.
Figure 3.1 Strategy, Results, and Metrics
Everything you do has an economic consequence for your clients and customers. Are you measuring it? Is your customer giving you feedback on the actual results that you created for them?
Quantifying your value and results will give you a significant advantage in the market. It will strengthen your customer relationships and loyalty. It will make you more valuable and allow you to charge higher prices.
Tip: Good strategy communicated to your employees, customers, and prospects will help you to increase your revenues, profits, and valuation.
Next week, we’ll talk about building a management team (so that you don’t have to be there all of the time, and so that your business performs better and is more valuable).
Thanks for reading!