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Top 3 Questions to Evaluate Your Strategic Initiatives

How do you decide on what decision stays and what needs to be put on hold? And once the decision is made, it's important to know that the return on investment is not the only metric to measure the impact. Alright, let us take a look at the top 3 aspects that you need to consider.

Does the initiative help you in driving your strategic objective?

Looking a little deeper into this question, the word to focus on is “driving”. The reason I say this is that most businesses stop measuring the strategic objective and do not analyze why this measurement came into place. This results in the organizations not actually knowing what truly drives their business. What are the key performance indicators, metrics, etc. that drive your overall business objective?

Hence, it is important to test your model with what-if scenarios and update them based on the results. When you apply the revised model, it not only enhances your initiative, but also helps you take actions that take you closer to your objective.  Well, opting for an enterprise performance management software would help, but you need to ensure that it keeps evolving with the way your organization works.

Does it have a material impact on your business?

The buzzword here is “priority” – prioritize the initiatives that have the most material impact on your business. Let us do a quick comparison to understand this. Say there are two initiatives:

Initiative 1: You are working on a new reporting initiative that is more rational and consolidated and it would save your organization 5% on its selling, general and administrative expense.

Initiative 2: There is another initiative to show product, customer and channel profitability that would allow sales and marketing managers to sell more profitable products and services and also cross-sell and up-sell that would increase the revenue growth by 5%.

What would your priority be? May be a tricky one, but you would definitely have one preceding the other in terms of importance.

Does it improve visibility into the business and enhance cross functional collaboration?

Of all things, the effectiveness of an organization relies heavily on fact-based decisions, accountability for those decisions and measuring how every person in that line of site impacts the bottom-line. As plans and forecasts flow top-down into the organization, there may be tendencies of assumptions, constraints, etc. Breaking down functional silos serves as key to improving collaboration and sharing information. In simple terms – if your initiative is improving the visibility and collaboration, it will naturally answer the first two questions in the affirmative.

A scorecard would be a perfect way to monitor the strategic alignment within the organization. From top-down the leadership team gets to see the business performance dashboards and daily performance dashboards that provide analytics and meaningful visualization of the performance at various levels.

Clarity precedes strategy – It’s not who you are, but what you do that defines your business!!

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