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Acknowledgement
The contents of this PowerPoint are based on article titled Strategically Yours of Mr.Subroto Bagchi which appeared in his blog . This is my own interpretation of his article & easy understanding .
Strategy
The word strategy comes from the Greek word strategia, office of a general: linked to Strategos and means: The science & art of using all the forces of a nation to execute approved plans as effectively as possible during peace or war; The science & art of military command as applied to the overall planning & conduct of large-scale combat operations A plan of action resulting from strategy or intended to accomplish a specific goal The art or skill of using stratagems in endeavors such as politics and business (Source: The American Heritage Dictionary of the English Language)
Strategy
What the dictionary really suggests is that strategy is a matter of leadership priority.
It must engage leaders. It is something that is game-changing in nature. It is part science and part art. It is about large scale impact. Reasonable growth of business over what we have this year, doesnt really need a strategy for it; what is required is efficiency. Much the same way, someone has 25% attrition among employees and wants to reduce it to 20% the next year, all we need is efficiency. But the moment we want to contain attrition to halve it, we would need a strategy and we would need to make strategic choices.
Data is critical but swimming in it, does not get you strategy. Data is about the past & future data is an oxymoron. It is a projection and sometimes, a prayer. No data on past usage would have given Mr.Gopinath the confidence to get into the helicopter business. No data told Kiran to get into the enzyme business or to leave it. In the case of Siddhartha, data actually suggested that the idea of a coffee retail business was unviable because coffee consumption was going down.
If what you are discussing sounds counterintuitive, you are probably about to take off
If what you are discussing sounds counter-intuitive, you are probably about to take off.
Captain Gorur Gopinaths (Gopi) entry into the helicopter business & subsequently, the low-cost airline business (and in time, exiting that business) is about strategy and strategic choices. In his book Simply Fly, Gopi beautifully narrates how he and his buddy Sam decided to get into the helicopter business and Gopi says even today, he would have never gone into it (the helicopter business) if he knew the price of a helicopter! For the simple reason, he did not have that kind of money nor could he raise it! So what did he do? He and his friend Sam went to Singapore and negotiated with a helicopter owner to give them his copter on long-term rental. The man agreed, Gopi and Sam flew it back to India. The rest is history. The moment you shift your focus from owning something to operating it, buying property to leasing it, retaining talent to rotating it, you are beginning to think strategy and are more likely to make strategic choices that may be game changing.
Cafe Coffee Days are clean, friendly, affordable, air-conditioned & safe. It is a place where a boy and a girl can spend some time together in a pleasant atmosphere and they are willing to pay for it. This is not about coffee. Remember the tagline? Anything can happen over a cup of coffee.
God did not tell him that he can and should sell only coffee. He in turn, is not whipping his boys and girls to sell more cups of mocha and cappuccino, nor is he enticing his customer to keep drinking more coffee per session so that his profitability and market share go up. Siddhartha knows that in the boy meets girl business, the boy (usually the lesser intelligent but more focused) ignores the right hand side of the menu and pleads to the girl to try the black forest pastry or some equally expensive thing on the menu so that she may linger longer.
Adjacency is common knowledge to store merchandisers who are always doing what we call market basket analysis. Simply put, it means that your grocer must place jams next to the bread alley and gourmet cheese close to the wine rack. Similarly, if you have gone shopping for a pretty dress, you may be more open than usual to consider accessories that go with it. So they are displayed next to each other. That simple idea is lost on leaders sitting around a table to contemplate strategy for growth and profitability. Siddhartha probably makes more money from things he does not make than his original offering of roasted, crushed beans in hot water
Happy Reading