Strategic Setup

There are so many schools of strategy in the world that one
would imagine there is no correct way to develop a strategic plan for any
organisation which would be approved for its rigour and robustness by all the
strategy pundits of the world. One reason for this lack of convergence is
probably the fact that there are so many ways to even approach a business
strategy articulation problem.

Bob Simons, one of the most articulate professors at the Harvard
Business School and an expert in the area of Organisation Design has a simple
hypothesis which says that an organisation must build its strategy on four
simple Ps — Perspective, Position, Plan and Patterns and then find ways to
communicate and practice the key elements it decides to incorporate in its
strategy. The amazing success story of Siebel in the nineties is a case study of
how an organisation with a near obsessive focus on its customers can make a fine
art of this approach.

Set up by Tom Siebel in the early nineties, here is a company
that even today holds the record of being the fastest business to hit a billion
dollars in revenue - just seven years after its founding compared to fifteen by
Microsoft, fourteen by Oracle and eleven by Peoplesoft, and all achieved by
making the customer's success the sole measure of the company's success!
Viewed with the focus of the Four P strategic model, the company succeeded by
choosing the following model

Perspective: An obsession with customer service with the highest
levels of professionalism and a clear mandate that the needs of the existing
customer took precedence for all its people over new sales and any other
activities.

Position: A choice made to only focus on product development and
build an alliance strategy to handle all implementation needs and avoid all
conflict with their alliance partner channel. And that too only the product area
of CRM and having the maturity to say No to any other business opportunity,
however lucrative.

Plans: A decision to focus on hiring only experienced people who
could hit the ground running, design the organisation for scalability and invest
heavily in internal IT and Performance Management Systems to enable the goals to
be achieved.

Patterns: Clear demonstration of intent by having a culture of
frequent communications and transparency, with even the founder's key result
areas published on the company intranet and a total engineering approach to all
their initiatives including alliance and employee procedures and systems.

One could argue that such single minded focus on customer
satisfaction could result in loss of flexibility and could have been the reason
for Siebel to lose momentum post the Dot Com crash and its eventual recent
acquisition by Oracle. But that would take away from the spectacular success
achieved by the company by embracing the virtues of a focused and fully
integrated strategy. How many of the companies in our nascent industry are able
to show such focus?

And finally, on the theme of different approaches to developing and
presenting strategies for organisations, comes a simple five point formula for
business plan presentations from Sanjay Anantram the very intelligent and
articulate venture capital specialist from JumpStartups in Bangalore. Speaking
after an intense session at the NASSCOM Innovation selection process, he
counseled the young CEOs that however good the product or service or strategy,
the five key things that needed to emerge in an entrepreneur's presentation
were — Who are you, What is the problem you are trying to solve, Who else is
out there, How will you compete and beat them and finally How will you make
money? The moral here is that whatever the approach and rigour of a strategic
plan, unless these five questions find defensible answers no strategy can ever
succeed.