I am working with a major UK retailer to identify and develop new strategic growth initiatives. As part of our early work in the project we have reviewed the company’s successes and failures over the past five years or so, identifying the factors that made the difference between the winners and the also-rans. Our analysis has identified five clear factors that drove strategic success:
- Stick to your core. There was a clear correlation between the retailer’s focus on its core activities and its success rate. As the business stepped further away from its core product offer, the level of growth dropped dramatically. The retailer’s experience reflects a wider trend. Analysis by the Corporate Executive Board found that mature companies looking for a clear ‘growth restart’ were far more likely to succeed if they focused on re-invigorating and expanding their core business, rather than making a bigger leap into new markets.
- Go with the grain. My client had its best success when managers developed propositions that reflected how its customers actually shopped for and bought the products on offer. They found it far more difficult when they tried to change existing shopping behaviours: they couldn’t make water flow uphill. Do you understand how your customers want to buy and consume your products and services? And what new ideas do you have that support and enhance that behaviour and experience?
- Engage your organisation. Managers have realized that the more they focus on communicating with the organisation and engaging their people with the new initiative, the greater their chances of success. As with any retailer, engaging the store teams is vital, but our work has also highlighted the leadership team’s critical role of leading and encouraging effective cross-functional working right across the business.
- Be committed. Customers – and your people – can smell a half-hearted effort a mile off. My client’s best initiatives were those that were resourced effectively (though not lavishly) and, even more importantly, had been delivered confidently and proudly across their store network. The executive team had raised the stakes on success, but by doing so had encouraged their teams to get behind the initiative and to ‘go for it’.
- Enhance your differentiation. My client is a specialist retailer, focusing on a relatively narrow product category. Not only were their biggest successes found where the company stuck to its core; the success was even greater when the initiative added to, rather than simply supported, its specialist position and reputation. Success wasn’t about doing more of the same, but was about finding a way to become even more famous for its existing source of differentiation.
How about your new strategic initiatives? Which of these five factors could you better focus on to help you raise your chances of success and growth?
© Stuart Cross 2015. All rights reserved.