You’ll hear an organization talk broadly about its strategy, or its strategic planning process – but what about strategic intent? Sure, a baseline level of execution and delivery is important. But often we see organizations launch a “vanilla” strategy that seeks to imitate competitors rather than differentiate from competitors. In this article we’ll look at how strategic intent sets the tone for a winning strategy.
What Is Strategic Intent?
Strategic intent advocates use the term to describe “aspirational plans or an overarching purpose needed to achieve an organization’s vision.” Embedded within the “aspirational” part of that definition is a focus on winning. Winning customers, winning against competitors, and winning over the broader market. How does strategic intent inspire winning? By focusing a firm’s strategy on change initiatives that will lead to competitive advantages. To do that, the first step is to break down what competitive advantages look like in a given industry. For internet retailers, it might be efficiency in logistics and distribution. For pharmaceutical companies, it might be product efficacy and pricing. Whatever the case, strategic intent turns strategy from a “fit” exercise to a “stretch” exercise. I.e., an internet retailer not thinking about how to match a competitor’s operations but to create even better operations.
Features Of Strategic Intent
The specific features of strategic intent are best thought of as a hierarchy or pyramid of sorts. Let’s look at the levels from the ground up, starting with vision:
We’ve talked about this one already. A firm’s vision articulates the aspirational view of where the firm wants to be. A vision may sound as easy as scribbling down a few broad statements. But it’s not that simple since the future is uncertain. A good vision takes into account what kind of new trends or shocks an industry might experience.
The second rung of the ladder gets further into a firm’s core business. A vision talks about “where” a firm wants to be. A mission speaks to “why” a firm started up in the first place. A great mission explains to shareholders the “non-negotiable” values that a firm embodies as it carries out its business.
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Moving beyond business values, the business definition aspect of strategic intent is pretty self-explanatory. With a vision and mission in place, a firm’s business definition is the “x’s and o’s” of how revenues and profits are made. For strategic intent, a crystallized understanding of business definition is important in order to understand areas of relative advantage/disadvantage.
Building on the business definition pillar, a firm’s business model speaks to how a firm operates around the definitional components. A business model is purposeful and a point of differentiation within a firm’s strategic intent. In what way is firm X’s business model similar and different from firm Y’s?
Goals and Objectives
Lastly, and at the most granular level of strategic intent, are goals and objectives. These are KPIs – metrics of measurement once strategic intent is established. Goals and objectives hold a firm accountable for the strategy it has laid out. Without goals and objectives, a clear-cut strategic intent can become blurred, which takes you back to square one.
Strategic Intent Example
For a real-world example of strategic intent, let’s look to Asia. Specifically, Japan and Honda. Some time ago, Honda made the decision to enter the motorcycle market. But rather than look to imitate Harley Davidson or Yamaha’s success, Honda chose to start with products that were intentionally different. Honda’s competitors didn’t see Honda as a threat initially because there was no encroachment on the core business. But by carving out new, white space, Honda developed a loyal customer base and strong brand recognition. That allowed Honda to attack competitors from a position of strength. You can read more details on Honda’s strategic intent in this HBR piece.
A company that exhibits strategic intent shows creative, outside the box thinking. Honda didn’t try to win market share using the proven blueprint. Instead, they took a long term approach with a customized blueprint that ultimately won more market share. Many consulting engagements often seek to inject strategic intent into strategies that otherwise lack it.
Defining strategic direction is always hard to do. It’s part of the reason consulting firms get paid the big bucks! Strategic intent helps firms get more tactical around strategy by focusing on a winning formula. That formula will vary company by company, industry by industry. But it will always involve a vision for how you can differentiate from the competition rather than imitate the competition. And while strategy is most-often talked about at the firm level, you can use strategic intent for your own professional goals. If you’re targeting a career in consulting, think about how you can bring a unique edge, in both the recruiting process as well as when you land that offer!
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