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We all want our businesses to succeed, but how many of us actually use the tools at our disposal to plan for success?

Right Brain Creative Thinking And Business Strategy

Planning, in particular business plans are often seen as logical, linear and mathematical or singularly left brained activities.  However a successful business strategy has to be made up of two separate elements:

• Operational efficiency (OE) Left Brain and
• Strategic differentiation (SD) Right Brain, often called Positioning

To be at the top of your game you have to be excellent at what you do (OE) and be in a market (SD) where you are outstanding.

I think of operational efficiency as the application of tools and systems, available to almost everyone, to make business run as smoothly and efficiently as possible.

Strategic Differentiation

Strategic differentiation, it can also be thought of as positioning, on the other hand is more about ideas.  Who you serve and what you serve to them.  This kind of positioning can either be

• needs focused – what your customers want or what section of the market do you serve.  Wal-Mart is a great example here serving a price conscious sector of the retail sector; or
• variety focused – what kind of products and services you offer.  An example of variety positioning would be Apple.  Apple invented the iPod and iPad when there was no market for them but with clever positioning and marketing was able to sell them as must have products.

To be at the top of your game you have to be excellent at what you do and stand out in your market.

Operational Efficiency

The tools for operational efficiency are widely available, but strategic advantage gained by operational excellence alone can easily be eroded as your competitors copy what you do.  A classic case is the US auto makers being overtaken by the Japanese manufacturers in the 1980s and 1990s.

Average ideas well executed will keep your business running at a profit.

Brilliant ideas badly executed usually end in disappointment and financial ruin.

The good news is that even average businesses can be successful when they do things well and consistently.

Ask yourself these questions on operational excellence:

• Do we have strong processes?
• Are we as profitable as we can be within our culture?
• Do we regularly use operational and analytical tools (SWOT, PEST, the PPP, etc) to push ourselves to the boundaries of operational excellence?
• Is our cost base as low as it can be?
• Are our prices optimised for our market?

If the answer to any one of these is “No” or “We’re not sure”, then there is room for improvement.  The use of external knowledge and experience can help bring most businesses towards that operational Nirvana.

Strategic differentiation is much more difficult to quantify, altogether a less tangible nettle to grasp.  Part ideas, part conceptual, part market analysis and part cultural.  Strategic direction is as unique as the individuals that make up your business.  Marshalling these different and at times conflicting factors (in particular in relation to operational excellence) takes a different approach.  Vision, moral courage, dialogue, decisiveness and leadership.

When you look at the concepts and principles behind your business do you really stand out from your competitors? (No, be honest now…really?)

Are your business processes unique or sufficiently different?

Do we offer the same services or products differently from our competitors (Amazon versus retail bookstores) or different products in the same way (Amazon and Zappos)

Having a strong team and being open to change can keep you at the forefront.  Regular business strategy reviews will keep you ahead of the competition.  While operational excellence has a boundary, strategic differentiation will forever be an expanding and moving target like the boundaries of our universe.