Most companies grow through an organic process of making adjustments and improvements as they go. While this process keeps most companies in business, it is difficult to become a market leader without any clear strategy for doing so. Companies aspiring to transcend their competition need to go through a High-Growth Strategy Formulation Process in order to create a viable plan.
The goal is to define a clear, coherent, and effective roadmap that is accepted and adopted by ALL senior team members. The best way to accomplish this goal is to physically move the best minds in the company away from the constant distraction of phones, emails, and drop-ins, and have them focus on just the one task of cranking out an effective roadmap to sustainable 100% growth in 24 months.
The preparatory steps are:
- Set a clear goal of defining a coherent strategy for how the company shall double its revenue within 24 months.
- Determine who will be involved in this planning session. The end result should be about 10 – 20 of the top people in your company participating in this effort.
- Set the time and place. It should give participants enough time to clear their calendars, and the location should be either easily commutable or accessible through company-sponsored transportation and accommodations for the duration of the meeting.
- Find a suitable moderator to run the sessions. The CEO should focus on the actual work rather than moderating the sessions.
- Make sure everyone understands that their ONLY priority during the two days of the retreat is to leave with a clear and coherent plan that they are completely committed to.
Day 1: Identify the Optimal Growth Market Segment—Part 1
The most important decision that any company can make toward doubling its revenues within 24 months is choosing what market to go after.
The key is to understand that while the process of selecting a target market is important, far more important is the decision to stick to the chosen market. In other words, the results are far more dependent on the discipline of execution, rather than whether or not the target market was the best choice.
The day’s work is divided into the following sections:
- Session 1—Select the target Product. Your company may have many products and services. However, for growth strategy planning purposes, only one product or product family will be taken into consideration. A voting process can be used to determine the consensus around which product should be the primary focus of this exercise. This typically should be completed in the first 30 minutes or so.
- Session 2 – Select the target End Users. For the target product, open the brainstorming session and ask participants to generate as many possible end users for the product as they can. The idea here is to be able to “think outside the box” and uncover previously neglected potential customers for the flagship product. Stop the brainstorming when the suggestions become repetitive. This should be completed within about 90 minutes.
- Session 3 – Build Customer Scenarios. Divide the participants into small teams of three members, taking care that no two members are from the same department. Have teams pick as many as five potential end-users for which they will build customer scenarios. The team will take each scenario through the scenario builder to ensure that a rigorous customer scenario is built and ready for evaluation. Someone on the team should be responsible for typing these into a laptop so they can be easily read and reproduced. Teams should spend an average of 30-45 minutes on building each scenario, or about three to four hours on building about five scenarios.
This should end the first day. So far, the participants have selected the top product, generated all possible end users they can think of, and created compelling customer scenarios for each end user type.
SOMAmetrics has the skills and tools to assist participants in quickly and accurately building customer scenarios.
Day 2: Identify the Optimal Growth Market Segment—Part 2
The goal on the second day is to arrive at the top three target customer groups and rank these from first to third place.
- Session 4 – Evaluate and score each scenario. The teams will put each of the scenarios they have built into an evaluation and scoring matrix. This will likely take 20-30 minutes for each scenario, or about 2-3 hours to complete all the scenarios and rank them according to their scores.
- Session 5 – Present the Scenarios. Each team will take turns to present their scenarios, one round at a time starting with their first choice, and moving last to their last choice. Teams should limit their presentation to no more than five minutes per scenario, or no more than 30 minutes total. Assuming there are between 5 and 7 teams, this should take about 3-4 hours to complete.
- Session 6 – Vote on the top three scenarios. The rest of the day’s work is left for the Voting committee, which reviews the presentations and written evaluations and moves to vote on these—until they have the top three customer segments ranked #1, #2, and #3.
This marks a significant milestone in the strategy planning effort. The company now knows exactly which customers to go after and why these are the best customers for it.
SOMAmetrics has the skills and tools to enable participants to quickly and accurately evaluate and rank customer scenarios.
Day 3: Build the Go-To-Market Strategy—Part 1
The goal for Day 3 is to build an integrated and coherent go-to-market strategy for the top customer group. This includes defining targeted competitors, positioning, pricing, communication, and distribution strategies.
- Session 1: Identify the Buying Scenario. For complex products, this step is critical in identifying the buying committee that will likely jointly make the buying decision. The goal is to define what the potential issues are for each product and determine what the company must be able to provide to address each issue. This should likely take about 2 hours.
- Session 2: Identify the key competitors. Competitors come in different types. Some are direct and offer the same product to the same customer group. Others offer different products that provide the same benefit and therefore are viable alternatives. The company should identify all possible sources of competition and determine what it can do to beat these competitors. This will likely take about 2 hours.
- Session 3: Define the Whole Product. The scenario building would have already provided the must-have product requirements for this customer group. During this session, the team will identify what is already available, what can be quickly built, and what capabilities will take the longest to find. This is a major section and will likely take 3-4 hours to complete.
At this point, the team has identified the buying team and their main issues; the key competitors that target the same customer group with the same benefit and how to counter that; and what the whole product will need to look like in order to beat competitors.
Day 4: Build the Go-To-Market Strategy—Part 2
During Day 4, the team works through the remaining go-to-market strategy elements. Day 3 has defined the foundational elements that provide the context for the rest of the strategy formulation effort.
- Session 4: Define the Pricing Model. The next step is to determine the pricing model and values. Pricing depends on a number of factors, including the value that the company can convincingly communicate to customers, the customer’s ability to pay, competitors’ pricing, and the input cost to the company. Regardless, the goal for high growth should be to ensure that pricing is no hurdle for winning customers. This should be completed within 90 minutes.
- Session 5: Define the Positioning. The next step is to create a simple, clear, and compelling positioning statement that will serve as the foundation for all of the company’s communication efforts. This is a crucial step that must be done very carefully. Companies should allow 2-3 hours to come to a consensus on what the company offers and how it is different from competitors.
- Session 6: Define the Sales Strategy. During this step, the team will determine three things: how it will sell the product to the target customer group, the top five customers that must be won, and the 12 month and 24 month revenue targets. This session can take about 2 hours to complete.
Day 5: Integrate
The goal of the final day is to integrate the work done so far, and to ensure that each department now understands what it must do to implement the plan.
- Session 1: Integrate the Strategy. The CEO will present the integrated go-to-market strategy that the team has worked on during the past four days. From now on, the team should focus on implementing this plan into all departments. This will take about one hour.
- Session 2: Departmental Targets and Key Performance Indicators (KPI). The participants will break up into departmental teams and work on setting their targets and key performance indicators. The first quarter will be devoted to making the transition from the current way of doing business to what the new strategy dictates. This is a critical and pivotal period, and the KPIs should reflect that. At the end of the session, each team will have anywhere from 3-5 sets of eight (8) quarterly departmental key performance indicators. This will take about 3-4 hours to complete.
- Session 3: Present Departmental Targets and KPI. Each department will present its Key performance indicators over eight (8) quarters. These will be the targets that each department will be committed to delivering over the next two years. Each department will take about 10 minutes to present its KPIs.