By frequently revisiting the plan and piloting concepts in response to new insights, the organization can adjust the route it takes to fulfill that purpose. But this flexible, iterative approach to enterprise strategy requires a degree of organizational resilience that few companies exhibit — yet.
Five steps toward a more dynamic enterprise strategy
In working with EY clients in every sector and every market, we’ve identified five steps that can fuel the necessary shift to a more dynamic and resilient enterprise strategy.
1. Articulate your purpose
Successful strategy starts with a clear sense of purpose. That’s not new, but the importance of deciding what you are —and just as importantly, what you are NOT— has never been greater. Embedding purpose in strategy guides clear decision-making and helps maintain the organization’s North Star. And articulating it clearly to employees, investors, customers and throughout the entire supply chain keeps the field of vision focused on opportunity.
2. Cultivate a culture of continuous change
The C-Suite must be aligned to this new world where strategy is a living-and-breathing, dynamic process. Consistent leadership and clear communications are essential in ensuring the organization is ready to embrace an enterprise-wide commitment to faster implementation and an internal culture of change management and process design that is fundamentally different from what it has experienced before.
3. Broaden inspiration and experimentation
Organizations still struggling to embed a culture of innovation throughout their operations should seek out new sources of inspiration, looking beyond traditional eco-system and competitors to learn from other industries and companies. And they need to be prepared to experiment courageously; failing fast, learning quickly and moving even faster to scale up those experiments that succeed and discarding those that don’t. To avoid the “theater of innovation” —in which experimentation is divorced from enterprise-wide purpose and goals —leaders within the company will need to think differently about who they hire and how they reward innovation in order to activate the multidisciplinary thinking which fuels new ideas and rapid sprints.
4. Deploy analytics for rapid transformation
Today’s powerful data sciences and technologies are essential building blocks of organizational agility. Harnessed effectively, they can equip the organization to better understand changing market conditions and customer needs, and they can enable rapid change across the entire value and supply chain. In particular, companies will want to foster the virtuous cycle that data can enable, in which analytics reveal how to build products that improve and differentiate the customer experience, which in turn grows the customer base, which yields yet more valuable data and insights for future innovations.
5. Accelerate the cadence of strategic review
No matter which sector and business models characterize their operations, companies that have successfully embraced a dynamic enterprise strategy share a rigorous commitment to frequent strategy and portfolio review. They reject the outdated “set it and forget it” approach, refreshing and redirecting organizational initiatives regularly to stay true to that North Star. This requires a frank assessment of the portfolio, looking across various horizons to assess short-, medium- and long-term bets and how those intersect with the conditions and opportunities that are unfolding ahead.
In a recent EY survey, 67% of institutional investors want companies to undertake potentially disruptive innovation projects even if they are risky and may not deliver short-term returns
In a world where disruptive forces are constantly rewriting the assumptions on which business strategy of the past has been constructed, today’s leaders need a more flexible framework with which they can convert disruptions into opportunities — one that evolves just as fast as the conditions in which they operate do. Embracing a company-wide mindset of resilient, responsive and dynamic strategy — and the necessary willingness to assess and reassess positioning more frequently than ever before ― will equip their organizations to thrive comfortably in an uncomfortable world.