With several marquee clients I see a consistent trend of individuals and teams who confuse planning with strategy. Specifically, when organizations are focused on revenue growth, the prioritization of relationships to invest in is often based on a “foreseeable transaction” within their named accounts, geographical territories, or even global account management efforts.
Herein lies the challenge: sociologists say an average individual can proactively manage between 100-150 relationships. Which ones do you choose and what are the criteria? If you believe, as I do, that true relationship development (vs. transactional networking) is intentional, how do you then choose and prioritize which relationships to invest in? You certainly can’t invest in everyone equally, so how will you balance relationship creation and bridge efforts to relationship capitalization?
Planning is extrapolation of the present. You ask, “What am I doing today and how can I do more of it?” In the revenue growth example mentioned above, the organization evaluates its current portfolio of products and services, market conditions and sales force before establishing a revenue growth target. It then divides that target amongst the sales force. It may happen that Steve, who has a geographic territory or handful of named accounts, will have to generate $10M in top line revenue as his quota for next year. Steve starts to panic since he only did $7M this year, and starts planning forward just which accounts, transactions and relationships he needs to get to $10M. What Steve and his organization then become focused on is existing relationships, which may be a very limited universe.
Strategy, on the other hand, is painting a picture of the future and developing a path to get there. John F. Kennedy proclaimed a moon landing would happen ten years in advance, at a time when the country wasn’t even close to accomplishing such a monumental task. Truly visionary leaders join an organization and develop a vision of the future; they quickly nurture intracompany relationships, as well as externally-focused ones to recruit top-notch talent, fuel the vision and mission with the necessary resources, and execute a set of priorities to bridge the current state with that future state.
Relationship strategy works the same way; it focuses on the future and develops a path to get there. A vision of the future reveals a much bigger universe, one that encompasses existing relationships and those to anticipate, and – in many cases – new ones we must create. Unprecedented growth will come from a unique return on strategic relationships derived from your relationships strategy.
To learn more, please join us online for an upcoming webinar on Relationship Economics @ Work, or in person at the 2011 Customer Economics Retreat.