One per cent vision, 99 per cent alignment

In article two of our three-part look at strategy, we quote Jim Collins and Jerry Porras: “Building a visionary company requires one per cent vision and 99 per cent alignment.” Not every company needs to be visionary, but the essence of this quote is spot on when it comes to implementing and discussing strategy.

I find it coincidental that the front part of an annual report is called the strategic report, but that strategy often does not seem to be in the driving seat. This happens for two reasons. Firstly, as we discovered in the first article in this series, strategy is relative; companies often publish formal CEO-level rather than board-level strategies. Secondly, the reported strategy is articulated as a collection of data points rather than a way to achieve a stated outcome.

Strategy in action, everywhere

Many consultants’ curse is the siloed approach and the strategy ‘section’. Too many companies think about the compliance angle and try to lump all their relevant content in one place so it’s easy to find, coming at a cost to the overall story. A strategy ‘section’ should, at most, outline the strategy and how you’re measuring it, include a brief discussion of why it matters, and link to other sections. This allows you to give readers a high-level understanding of the strategy early on, and to discuss how it impacts or informs other functions of the business. You should weave an outcome-based strategy throughout the strategic report. For example, how do the markets you operate in and your stakeholder engagement inform your strategy? How does your strategy impact your business model and risk management?

Beyond the strategic report

The name ‘strategic report’ seemingly infers that strategy should be omitted from other areas of the annual report. Still, strategy is as essential in the governance section as it is upfront. The board is responsible for delivering purpose through the company’s strategy. Therefore, the governance section should demonstrate how governance structures and leadership support the company’s strategy. Often, this is left to the wayside to show compliance with the Code and other nice-to-haves. Failure to align your governance reporting with the broader strategy story is often where companies come unstuck, and their communications become disconnected.

Outside of the annual report, the story of strategy remains vital for properly joined up stakeholder communications. You can use your strategy to discuss and frame topics online whether that is for your people, suppliers, investors, regulators or media. Often, we see purpose as the guiding light and a set of performance indicators with no clear pathway between the two. Strategy is the conduit that helps your audiences bridge the gap between what you’ve done and what you’re trying to achieve.

In short, your strategy needs to facilitate discussion throughout your communications. It is simultaneously the driver for your company’s future and the prism through which your audiences judge you on what you have delivered. In this series’ third and final part, we will discuss how to measure your strategy and its impact.

If you’d like to discuss this, or any other subject, please get in touch with Richard Costa, Senior Corporate Communications Consultant at richardc@gather.london

We’d love to know what you think.