Small and medium business leaders are no strangers to long to-do lists. But when it comes down to it, most are working to answer one simple question: “How can I best ensure I meet my business goals?” Of course, the answer to that question depends on many complicated factors, but there are three key elements to success that all companies should consider. Today we’ll take a look at the first element, and dive into the other two in later posts. Without further ado:

1. Having a clear strategic direction
2. Fostering a culture of execution
3. Creating a trusting and aligned leadership team

So, what is a strategic direction, why is it necessary, and what is it used for? Let’s take a look at its four components.

• Vision – Why do we exist?
• Mission – What do we do?
• Values – How do we behave?
• Strategies – How do we succeed?

You can’t jump right into the strategies portion, although it can feel like the most important part. Deciding how to succeed when you only have a vague sense of why your business exists or what its guiding principles are makes achieving goals very tough.

A vision statement is intended to inspire and motivate the company’s employees by providing a picture of where the organization is heading. It is aspirational and inspirational. It provides a guidepost to help make decisions and keep the workforce engaged. If you’ve ever been to a Disney park, you might not be surprised to learn their vision is “To make people happy.” This vision statement should be at the core of everything, from your company’s culture to its policies.

A simple, powerful mission statement makes it clear to your employees and customers what the purpose of your business is. Consider how the following mission statement impacts the evolution of a coffee company we all know, Starbucks: “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.” What if the mission statement was just “We serve coffee”? This would send a much more vague and unmemorable message to employees and customers.

Let’s move on to values. Whether you know it or not, your company has a culture. Do you know what your company culture is? How does it assist or inhibit in moving your company forward? Being intentional about how your leadership team and workforce should behave while they are working together to carry out your company’s mission can be a great asset. It can dictate how your employees will treat each other and what customers can expect from your business. Values should be used as a guiding principles in decision-making.

You really only want 2-3 core values to dictate how you make decisions or operate. The criteria for these are that they must already be evident in the culture and they must be exhibited by the leadership team already. If they do not meet these two criteria, they are not core values, but aspirational values. Have you flown Southwest Airlines? One of their core values is “fun-LUVing attitude.” They even make the safety announcements fun to listen to!

Last but certainly not least, let’s get to strategies. What do we need to get done in the next 1-3 years and how are we going to succeed? Leaders mistakenly think that the smaller the company, the less this is needed. Not so! Whether you run a small department in a big company or a start-up, workgroups of every size can benefit from this clarity.

Strategies are the priority areas that need continual focus for the next 1-3 years to move you towards success. These are anchors that provide the filter or lens through which decisions must be evaluated to ensure consistency and focus. Groups that do not have these in place frequently get tempted to make opportunistic decisions that can harm long term success. You only want 3-4 strategies because it is difficult to evangelize and align the team and resources to a greater number. Review strategies and formulate new execution plans yearly to support these multiyear focus areas.

Whew, now we have a strategic direction! Join me for the next installment to understand how to foster a culture of execution to deliver on your strategy.