Values and a voice…
These days, annual reports are much more than just a home for the numbers aimed purely at finance folk. At their best, they’re strategic documents setting out for all key stakeholders what a company has done to live its core purpose, create lasting value and contribute to the wider world.
Values and a voice are critical here. According to the FT’s Peggy Hollinger, “A recent study found that companies that came in highest or lowest on a well-known ranking of LGBTQ policies were rewarded by investors with share price rises, while those in the middle were ignored. It was not about who had the most inclusive policies but who had the clearest position.” The moral is, avoid the murky mid-zone – have a strong point of view and let it sing.
So as we head into 2024, I’m resolved to put more clarity and conviction into reporting.
Virtuous circles, wheels of fortune, magic roundabouts – the one infographic more beloved by consultants even than the hierarchical pyramid or two-by-two matrix is the strategy loop. The FT’s Andrew Hill lays into them – their beguiling neatness, their often shaky foundations and their tendency, like boats too long in the water, to gather barnacles of complications.
“Strategies and business models are not infinitely repeatable perpetual motion machines,” says Hill. “If they were, chief executives and their teams could go home.” Yes, but given that these folk are staying at their desks, the question is: what should they be doing? The answer still is crafting and communicating the best strategy – the company’s way to win. And vitally, focusing on putting it into action. Too many strategies get lost in translation – declared from on high with more or less clarity and largely ignored when it comes to employees carrying out their day-to-day tasks. In this respect and to loop back, infographics can be a very helpful tool when it comes to explaining and implementing strategy. But only if they’re properly rigorous and compelling.
So long live loops, so long as they’re in service of strong strategies.
Going back through some of my old files as groundwork for a new project, I dug out this distillation from 2005:
Over a decade on and a world away from that time, it’s good to see that the trend in business is indeed away from the pyramidic and matrixical towards the creative and coordinated. Whether it’s the ever-growing mega ecosystems of Amazon et al or the bloom in networks of micro businesses – our days call for, encourage and reward new ideas and the close collaborations of like-minded individuals with complementary expertise.
Strategies are stories…
I’ve been doing a fair bit of work recently which has included discussing with clients what strategy is all about. The conversations have tended towards couching the strategy thing in terms of good decisions and actions. Looking at it this way, strategy comes down to a group of people (a team, a company, a country…) answering a few simple yet essential questions: What are we going to do? Why? And how? It’s a world away from those thick and expensive docs heavy with impenetrably overloaded matrix diagrams so beloved of a certain kind of consultant and belittled by the great information design guru Edward Tufte.
So strategies are social. They are action. And they are something else, too: they are stories. Bad strategies are tragedies, full of loss and woe. Good strategies are adventures – epic tales of worthwhile quests and real achievements, of great characters and grand deeds.
I know which strategies I’d like to read…