This article presents a process that I have developed, when I supported the creation of a new brand cooperation strategy at Mercedes-Benz. According to Oxford Dictionaries, a strategy is “a plan of action designed to achieve a long-term or overall aim.” It is therefore important to determine what the overall aim should be. A comprehensive business plan should contain, among other parts, the purpose, the strategy (including the overall aim), and the operational tactics. I categorised six strategic processes that are relevant when crafting a new strategy: exploration, association, creation, communication, implementation, and iteration. To remember these processes, use the abbreviation EACCII.
Through a new strategy, a company can become more relevant and hopefully, also more profitable. Preferably, one creates a new strategy from a position of strength when resources for a transformation are available. Staying relevant in an environment that experiences constant changes demands ongoing observation. Strategists can establish urgency for creating a new strategy by vividly presenting the negative implications that will potentially occur when sticking to an outdated strategy.
Strategy begins with exploring the business environment and the megatrends that affect the industry that the company operates in. A prominent framework that can be used during this step is the DESTEP analysis.
Usually one accumulates a lot of information during this process. When working at a multinational enterprise (MNE), it is important to talk with different departments and gather their input and insights. One has to explore information and discuss the strategic meaning of it. Unfortunately, not every department employs a strategist and therefore, one has to find the right contact person with whom one can have regular meetings to discuss strategic topics. For example, when working on a brand strategy, one needs to gather information from overseas markets, the marketing research department, the research and development department, the social media department, and other relevant departments that offer insights on brand image perception, customer behavior, society, and technology changes. One has to ask the right questions to the right people. What is the current brand image? What do customers demand right now and in the future? What demands will our society have in ten years? What technologies are currently being developed and what impact do they have on the brand? Strategic work requires intensive discussions.
After having explored and accumulated enough information, one needs to make associations between the different inputs and combine different information to understand the bigger picture. Creative thinking skills are crucial for this step to make connections between related items or pieces of information. For example, if society demands autonomous driving cars in the future, and the relevant technology is currently being developed by the research and development department, then one has to be able to make the connection and include autonomous driving as a key theme to the brand strategy.
Furthermore, it is advised to discuss assumptions and potential recommendations with strategists from other departments. Assumptions should be based on facts or on expert opinions. Ray Dalio explains that an idea meritocracy can only be achieved through transparent and truthful discussions and that having a wrong perspective can only be avoided by involving others in the decision making process. An open-minded approach will lead to better results.
The creation process requires the highest form of strategic thinking: one has to combine the knowledge of the company purpose, the overall aim, the information from the analysis of the business environment and mega trends with the information of every department to recommend a new course of action. During the creation process one uses the gathered information to generate logical ideas that lead to new operational processes, new products, or new services.
Hence, strategists need to have an excellent understanding of the organizational structure. The final recommendation has to be bold, clear, and forward thinking. At MNEs, it is often not the case that the company vision and marketing strategy are created simultaneously. However, as the company vision and the marketing strategy are intertwined, strategists should always be part of the vision creation process.
Creating a new strategy often requires change that will transform current operational processes. Therefore, it is highly recommended to adapt Kotter’s 8-Step Change Model. In short, when creating a new strategy, it should be done within a coalition. Strategy is about working together with other people. If one crafts a strategy on its own, it is likely that it will not be implemented because of missing consensus. Hence, the recommendation should not be officially communicated until all relevant departments reached agreement on it. Once the recommendation is widely accepted and consensus is reached, the strategy can be communicated. By then, every department is aware of the consequences and will not be shocked when the strategy is communicated.
The communication process depends on the company culture. By analyzing the cues of how messages are generally spread, one can derive the best way of communicating the new strategy. As change is uncomfortable for most people, it is recommended to be as sensible as possible and as austere as possible.
Employees and managers are bombarded daily with new messages and the vision is only one information they receive. Therefore, one cannot communicate the change vision often enough and the communication should be part of a wider integrated communication strategy that has the goal to assist the spread of the new strategy. The change vision and the strategy need to be over communicated.
The implementation of a new strategy can take many years and it is important that one gains the support of every involved stakeholder from the beginning. The implementation process has three parts: integration, celebration, and rigorous development.
Strategists need to integrate other departments into the implementation process and assist the operationalization of the strategy. However, this can be only achieved by working closely with their strategists by securing their buy in during the exploration, association, and creation process.
People are result-oriented and as soon as the hard work results in success, it should be celebrated. It gives people hope to continue with the strategic changes. Strategists should have formulated a clear road map and major achievements should be celebrated. Preferably, there is one little celebration after every six months to lift up the employee morale. However, one should only celebrate achievements that are tangible and directly linked to the new strategy. For example, a clear change in brand image perception could be a great occasion for celebration.
5.3. Rigorous development
Nevertheless, one should not celebrate too extensively as it sends the wrong signals: that the first strategic changes are successfully implemented and that it is time to relax. There will be many occasions that the new strategy will be challenged and the only way to manage a successful implementation is to work rigorously, obverse the development of the implementation, and take rigorous action when necessary.
One should not iterate a strategy just because results are not immediately visible in the short term. One has to stick to a strategy and it can take years before one can tell whether a strategy is successful or not. However, there will be signs that can tell whether a strategy is successful or not and it is the responsibility of the strategist to find the right key performance indicators (KPIs). Usually, sales strategies are easier to evaluate than marketing strategies due to the difficulty of tracking marketing success.
Change is omnipresent in today’s business environment. Once the strategy road map is fully implemented, one should use the EACCII Formula again and start from the beginning.