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Strengthening Your Strengths

December 8, 2008

More than likely you have explored your company’s strengths at least once over the last few years, (or several times if you have ever hired a consultant). Embracing business best-practices guides you to look at the business strengths of your shop, especially as you put a 2010 strategic plan together. But from a strategic perspective, you are not interested in a laundry list of everything your company does well. In fact, sometimes this can bog the planning process down.

You want to identify the strengths that matter. (Let’s call these key strengths.) Everything else is just icing on the cake. Finding these key strengths can be like panning for gold. You sift through the sand to find the most valuable nuggets. Uncovering those nuggets, those core activities, processes, products, services and intangible assets that propel your company forward is critical to the success of your organization and its growth. Here are four different places to look for your key strengths. Use the examples and questions to identify a handful of your strengths to help guide your strategic plan.

Finding meaning: Do not let the title of this section scare you away. No intense therapy session is needed to dig into defining the purpose of your business. You may or may not have a mission statement for your company, but somewhere on paper, or in your thoughts, you know why you started your business. Here are a few questions to get you started:

What is the purpose of your business?
What business are you really in?
Why does your business exist?

Companies are founded for reasons as varied as something to do during retirement to making the world a better place. Challenge yourself to answer the above questions honestly and with conviction. To jump-start your thinking, here are some examples from organizations large and small:

To solve the growing diabetes crisis
To capitalize on a real estate growth trend
To work for myself
To provide quality window and door products better than anyone else
To make fitness a way of life for everyone by making it fun, easy, and accessible to all
To make my community a better place to live, work and recreate through publicly accessible open space
To provide people with a great place to work

Putting all the semantics and flowery words aside, state the purpose of your business in a few short sentences.

Getting motivated: An intangible, but powerful, force in all companies is the motivation of its employees. While this may seem like an odd place to look for your key strengths, consider that nothing gets accomplished without some sort of human intervention. Most likely, your employees have the choice, or the opportunity, to work anywhere. Yet they work for your organization. Why? What brings them to work everyday? What brings you to work everyday? What are you passionate about? Without passion or motivation, nothing gets done.

Consider the example of a small, privately held construction company that specializes in the construction of water and wastewater treatment plants. The company’s employees are passionate about building world-class water facilities. In fact, one employee told me he loves going to work every day and could not imagine doing anything else. Because of this key strength, the company is the “contractor of choice” of many public agencies in its region.

You and your employees are the organization’s biggest assets. Find out what keeps them and you going so you can feed that fire. Here are most important questions to ask:

What do you pound the table about?
What motivates you to do your business?
What makes you get out of bed in the morning?
Why do your employees work for you?

Show me the money: If I asked you how you make money, more than likely you would reply by explaining the types and number of products or services you sell. While this is correct, look at your revenue generation from a different perspective. Resist looking at your income statement for the moment. We will look at a strategy best-practice to gain some insight into what really drives your profit engine. The best-practice is to think about your revenue in terms of profit per “X” such as:

Profit per customer or client
Profit per customer visit
Profit per employee
Profit per order
Profit per product or service
Profit per product or service line
Profit per region
Profit per billable hour

You might be tempted to look at the list above and decide that several of these are your profit engines. However, the challenge is to determine which one is actually the best revenue driver for your business. That is to say, they may all bring money into the business, but one will have the biggest impact. Looking at your revenue generation from this perspective is just like panning for gold. You do not need to do change your activities, but you might need to look at your pan from a different angle to see the nugget.

Consider a regional retail chain, which focused on the individual revenue and margin of each store. Therefore the owner thought his profit engine was simply profit per store. Of course the individual profitability of a location is critical and makes sound financial sense. But from a strategic standpoint, think about how shifting from the perspective of profit per store to profit per customer might change some activities. Now instead of stores competing, they collaborate. Not only do the employees behave differently, the customers feel a difference and so does the bottom line.

Keying in on your resources: The sum of all individual resources is what combines to make up your company. Things like skills, assets, capabilities, competencies and so on are all the resources you use to deliver your product or service. What unique skills, resources, capabilities and assets set your company apart in the marketplace? How can these skills and resources be used to create value in the marketplace? Here is a list of some areas that you might consider when looking for your key resources:

Knowledge/Expertise: All the information you have in your organization such as operating history, customer profiles, knowledge of buying trends, functional knowledge about your profession, research and development and good old-fashion wisdom. If someone were to start your company from scratch, what would they have to know to get to where you are now?
Processes: All the systems, both formal and informal, that keep your company alive such as: operations, customer service, distribution, delivery, marketing, etc. Specifically, what are the key processes that allow you to deliver your product or service with the highest quality in the most efficient way possible?
Products or Services: The final output of your process, which is based on your unique knowledge and expertise, is potentially a key resource. Your method of production, service delivery, product components or service approach may add up to something no other company can produce. Are your products and services assets that set you apart?
Relationships: This is a great area to look for intangible resources. We often overlook how much impact our business relationships (vendors and suppliers) and employee relationships have on our business. Who are some of your key relationships? Think about upstream and downstream associations.
Intellectual Property: Any of your trade secrets, protected or not, are a potential source of key strengths. Consider the special activities or processes that you keep within your company–those intangibles that are your special sauce.
Personnel: As discussed in the previous section, your employees most likely are an important key resource. Do you have a staff with skills and capabilities that would be tough to replace? Or a staff whose teamwork makes the organization great?
Assets: Assets can be anything from your kitchen sink to your bank account, depending where your office is! But are there a few key assets that make your business hum along easier? Consider items such as office or retail location, financial standing, brand, reputation, specialized equipment, etc.

Your Key Strengths: So now it’s time to identify your strengths by using the questions provided above. After you have listed your company’s purpose, passion, profit engine and key resources, review your list for common supportive threads. Then synthesize your list of strengths down to your top five key strengths. Remember – be specific so the list is useful. Make your organization stronger in 2006 by strengthen your key strengths.

Erica Olsen (Erica@m3planning.com) is a principal of M3 Planning, making strategy a reality for entrepreneurial-spirited organizations. Her company launched MyStrategicPlan.com, a web-based strategic planning site for small and medium businesses. She is also an instructor and a writer.

For more information: If you have any questions regarding these articles, or desire further information, please contact us.

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