GOST Framework

At the heart of most strategy challenges is a lack of clarity as to what strategy is and how it differs from some of the other key businessplanning terms. If you think that this lack of strategy knowledge only plagues new managers at the lower levels of the organization, take a look at the following quotations I’ve collected during my work from CEOs describing so-called strategies that aren’t strategies at all:

  • • Become the global leader in our industry.
  • • Use innovation to build customer-centric solutions.
  • • Grow our audience.
  • • Strengthen core business, execute new initiatives, and reduce costs.
  • • Increase sales 25 percent in emerging markets by pursuing new growth opportunities.

The examples demonstrate how frequently the terms goals, objectives, strategies, and tactics are used interchangeably. I developed a simple framework called GOST (Figure I.1) to help managers at all levels use and teach others to use these business-planning terms appropriately.

I.1 GOST Framework

Figure I.1 GOST Framework

A goal is a target. It describes what you are trying to achieve in general terms. The following is an example of a goal for a regional sales director:

Goal: Win the national sales contest for our region.

An objective also describes what you are trying to achieve. The difference is, an objective is what you are trying to achieve in specific terms. The common acronym used to help flesh out an objective is SMART: specific, measurable, achievable, relevant, and time-bound. Objectives should meet these criteria, and they should flow directly from the goals you’ve already set. As evidenced in the following example, the objective matches up with the corresponding goal established earlier:

Goal: Win the national sales contest for our region.

Objective: Achieve $25 million in sales by the end of the third quarter of this year.

Once we’ve identified the goals and objectives, then we can determine the strategy, which is the path to achieving them. Strategy and tactics are how you will achieve your goals and objectives, how you will allocate your resources to succeed. Strategy is the general resource allocation plan. The tactics are specifically how you will do that. Using the previous example, we can see how the strategy serves as the path to achieving our goals and objectives.

Goal: Win the national sales contest for our region.

Objective: Achieve $25 million in sales by the end of the third quarter of this year.

Strategy: Focus selling efforts on expanding share of wallet with current customers.

Tactics: Have district sales managers work with sales reps to schedule appointments with the top five customers for each territory. Prepare a sell sheet showing dollarized value of using our products in combination. Videotape three customers using two or more of our products in combination. Purchase iPads and put new sell sheets and videos into a presentation for use during customer meetings. Create a dollarized, value-close, talking-points checklist to assist district managers and reps in expanding share of wallet.

If your managers are having trouble differentiating between strategy and tactics, they can use the “rule of touch.” If you can reach out and physically touch it (e.g., sell sheet, training DVD, etc.), it’s a tactic. The concept of strategy originated in the military arena thousands of years ago. Even that far back, Chinese general and philosopher Sun Tzu said, “All the men can see the tactics I use to conquer, but what none can see is the strategy out of which great victory is evolved.”29

It’s often said that strategy is long-term and tactics are short-term. In reality, long-term and short-term descriptors for strategy and tactics may or may not apply. A strategy that successfully helps you achieve your goal within three months might be short-term compared to tactics used for years to come in fending off a tough competitor. Using time as the criterion for distinguishing between strategy and tactics is common, but misinformed.

Since we can’t see or physically reach out and touch strategy, it’s often skipped in favor of going straight to tactics. A good number of the business plans I’ve reviewed over the past 15 years list goals, objectives, and tactics, skipping strategy all together. If strategy is not determined before tactics, there is no way of intelligently changing course when objectives and their corresponding milestones are not being achieved. Having a high-performance car (tactic) doesn’t help you reach the other side of the river if there isn’t a bridge (strategy) to cross it. With no strategy in place, it’s easy to fall into a game of tactical roulette, where you continually chamber a new tactic and pull the trigger, hoping something hits its target. But, sooner or later, you’ll be looking at a dead plan.

< Prev   CONTENTS   Source   Next >