What is Strategy?

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What is strategy? is not a question unique to content marketers. (See Robert Rose in Content Marketing Institute.) Lack of clarity about content strategy has firm roots in a universal confusion about strategy.

In the business world, Michael Porter of Harvard Business School is a preeminent authority of business strategy. He points out “most businesses don’t have a strategy for their organization.” Well, no wonder we struggle with content strategy.

And why don’t they? “Caught up in the race for operational effectiveness many managers simply do not understand the need to have a strategy.”

For marketers, might we say, “caught up in the need to build a brand, generate leads, respond to persistent ad hoc requests, figure out tectonic changes in buyer behavior and marketing technologies …”

 

Michael Porter on Strategy

In his seminal Harvard Business Review article in 1996, What is Strategy? Porter lays out basic strategy principles that can help marketers as they think about marketing and content strategy.

“The root of the problem is the failure to distinguish between operational effectiveness and strategy. The quest for productivity, quality, and speed has spawned a remarkable number of management tools and techniques. Almost imperceptibly, management tools have taken the place of strategy.

Operational effectiveness and strategy are both essential to superior performance. But they work in very different ways.

Operational effectiveness means performing similar activities better than rivals perform them.

Strategic positioning means performing different activities from rivals, or performing similar activities in different ways. Strategic positionings are often not obvious, and finding them requires creativity and insight.

Differentiation arises from both the choice of activities and how they are performed. Activities, then, are the basic units of competitive advantage.

Strategy is the creation of a unique and valuable position, involving a different set of activities.

Strategy involves making trade-offs. The essence of strategy is to choose what not to do. Strategy is (also) about combining activities. Competitive advantage grows out of the entire system of activities.

Strategy renders choices about what not to do as important as what to do. Strong leaders willing to make choices are essential. The leader must provide the discipline … define and communicate the company’s unique position, make trade-offs, and forge fit among activities.

Managers at lower levels lack the perspective and the confidence to maintain a strategy.

With so many forces at work against making choices and tradeoffs in organizations, a clear intellectual framework to guide strategy is a necessary counterweight.”

 

McKinsey Perspective

An equally eminent resource is the McKinsey organization.

In the McKinsey Quarterly article, Mastering the building blocks of strategy, practical guidance is provided on how organizations can best go about constructing strategy.

“While ‘insight’ conjures up visions of research, data crunching, and ‘aha’ moments, real strategic insight also rests on a seemingly mundane and easy-to-overlook factor: a thorough understanding of how and why a company, its competitors, and other in the industry value chain make money.”

A key point here is to …

“explicitly question corporate wisdom (by) dispassionately identifying the elements that contribute to performance. It requires curiosity that’s woefully lacking in some strategic planning processes. Getting executives to grapple with the issues can be a messay process. After all, formulating good strategies typically involves revisiting fundamental and deeply help beliefs about a company’s past and future, and people tend not to shift their views without a fight.”

In the McKinsey Quarterly article, Have you tested your strategy lately, 10 tests are provided that provide additional useful guidance.

In this article, McKinsey recommend you “know your competitive advantage: positional advantages and special capabilities.”

This helps you determine the markets in which to compete. Marketers can think of content as products that compete in the broader market where similar content is offered.

Key here is segmentation.

“Understanding segments correctly is one of the most practical things a company can do to improve its strategy. 80% of the variance in revenue growth is explained by choices about where to compete, according to research summarized in The Granularity of Growth, leaving only 20 percent explained by choices about how to compete.”

For content strategy, this means determining how to segment the content market, and to decide where to compete. This is why deep research to gain real insights about buyers and their decision making process is so important.

“Developing proprietary insights isn’t easy. In fact, this is the element of good strategy where most companies stumble. In our experience, companies that go out of their way to experience the world from the customer’s perspective routinely develop  better strategies.”

So improving this competency can help not only content marketing, but business strategy as well. Perhaps this connection can help with executive discussions on the strategic imperative of content.

 

What is Strategy? An Integrated Set of Five Choices

Roger Martin, in an excellent little article in the Harvard Business Review, Don’t Let Strategy Become Planning, provides a simple definition and guide.

“Strategy is the making of an integrated set of choices that collectively position the firm in its industry so as to create sustainable advantage relative to competition and deliver superior financial returns.”

Strategy is one thing — not a set of strategies — one integrated set of (five) choices:

  1. What is our winning aspiration?
  2. Where will we play?
  3. How will we win?
  4. What capabilities need to be in place?
  5. What management systems must be instituted?

Answers to these five questions tell you what initiatives to take in order to produce the results you want. If you’re having difficulty with planning or execution, check your strategy.

 

Real World Example – Salesforce.com

Todd Forsythe Salesforce at MarketoIn the fall of 2010, Todd Forsythe, Vice President of Global Campaigns for Salesforce.com gave the keynote presentation at the Marketo User Summit. (See Slideshare or YouTube.)

Forsythe explained that a year earlier, in the fall of 2009, as they prepared their strategy, plans and budgets for 2010, they decided the traditional marketing model was outdated, and that marketing was going through “a transformation.”

As a result, they reduced their traditional marketing spend 69%, and invested in two primary areas: social media and video.

At the end of the year, over 440 people had produced over 3,400 videos that resulted in 11,000 video views a day. Salesforce equated this to “44 uber-active sales reps having conversations with customers every day.”

In a difficult economic year, they delivered 33% more leads, and a pipeline value 18% higher year over year.

What’s more, they “produced more while spending less by leveraging the changing media landscape.”

 

What is Content Strategy?

What is content strategy?

“Content strategy is an integrated set of choices that define the strategic purpose, the basis of differentiation and value creation, and guidance for content investment decisions for customer facing content for the organization.

The work to define an organization’s content strategy provides the universal foundation and input to all content related activities for customer engaging functions.”

We recommend our Executive Summary: 6 Competency Framework for Enterprise Content Strategy. This framework identifies the “integrated set of choices” such as “capabilities and management systems” elements from Martin’s questions list.

We find both the categories and supporting details extremely useful developing and executing content strategy. When you review the list, you will probably see many areas you haven’t considered or adequately addressed We developed this framework over decades of work with clients. We and our clients have found it to be extremely robust and useful.

 

Key Summary Points

  • Salesforce.com made decisions about key activities they would do that their competition were not.
  • They decided what they wouldn’t do as much as what they would. (Reducing traditional marketing activities.)
  • They performed the video activity differently, having employees create video with a non-traditional methodology (not just shooting video).
  • They followed McKinsey’s Tests:
    • Does your strategy put you ahead of the trends?
    • Does your strategy rest on privileged insights? Clearly they performed in-depth analysis and found “a simple but profound customer insight”
    • Does your strategy embrace uncertainty? 69% reduction in traditional marketing spend to bet on two almost unheard of trends in 2009: social media and “hey, we’re gonna build 3,400 videos!”
    • They “focused on just a few crucial, high-commitment choices”
    • And most of the others.

Related Content

McKinsey Article: How digital is changing strategy

Content Strategy Beyond Marketing and Websites

HBR Article – Many Strategies Fail Because They’re Not Actually Strategies

Business Trends Indicate Need for Enterprise Content Strategy and Operations Management