In their 2008 article, David J. Collins and Michael G. Rukstad presented the concept of explaining the company’s strategy in only thirty-five words. According to the authors, one of the fundamental problems in this discussion is that managers and executives frequently have a vague understanding of their respective companies’ strategic planning (Collins & Rukstad, 2008). The solution to this issue is to analyze the organization’s strategy by breaking it down into manageable elements. To achieve this objective, Collins and Rukstad (2008) identified three critical areas to focus on in strategic statements – objective, scope, and advantage. Ultimately, the intuitive understanding of how to apply strategy is by combining the mentioned factors and implementing a specific and time-bound development plan.
Consequently, it is essential to analyze each of the strategic elements in greater detail to understand how to apply the strategy. Objective generally refers to what the company wants to achieve, but, according to the authors, it should be “specific, measurable, and time-bound” (Collins & Rukstad, 2008, p. 6). In other words, it is essential to differentiate between vague visions, such as “increase wealth,” from strategic objectives, such as “increase the market share by implementing service X in the next three months.” Consequently, scope concerns the company’s domain and emphasis on customers, geographic locations, and vertical integration (Collins & Rukstad, 2008). Managers should transparently analyze these three dimensions to determine the strategic plan for the organization and appropriately distribute available resources. Lastly, advantage is the most significant element in strategic planning that differentiates the company from its competitors. According to Collins and Rukstad (2008), it is critical that managers determine a specific competitive advantage since it is the primary means of achieving goals in business. In summary, all three strategic elements are essential since they enable a more thorough understanding of the organization’s strategic development.
Reference
Collis, D. J. & Rukstad, M. G. (2008). Can you say what your strategy is?Harvard Business Review.