If you were to go around your company, would everyone be able to recite 3-4 strategic focuses of the business? The concept of strategic pillars is a simple way to focus and align your team with the strategy of the business. It’s a concept many businesses skip over before moving to more tactical ideas and initiatives.
Amazon (which does everything from running server farms to owning Whole Foods) may seem like an odd choice to illustrate how to focus, create alignment and scale. However, you’ll see their seemingly-random activities actually support their strategic pillars.
What are strategic pillars?
Strategic pillars are simply the 3-4 strategic battlefields that your business needs to win in, no matter what else happens.
As Matt Laessig, COO and co-founder at data.world explains, “I’m a big fan of the Strategic pillars concept, which is really essential to a strategic planning framework. Strategic pillars truly represent the essential dimensions around the company’s long-term success. These are the most strategic battlefields that you need to win on.”
Businesses, like Amazon, use strategic pillars to replace complicated business plans. “We’re long past the time where you wrote a hundred-page business plan that was this magical guide to how you’re going to win in the competitive marketplace. Strategic Pillars are very durable over time,” Matt said.
What are the most common strategic pillars?
The most common strategic pillars typically have something to do with the following four areas:
- Smart Growth – Not just growth at all costs.
- Being a great place to work
- Having Customer Empathy or Customer Centricity
- Operational excellence
While these are terrible names for the actual pillars, you get the idea. Apple focused on “Design and Simplicity” as their customer-centric pillar, for example. Each Pillar should have deep meaning to the organization. But these four areas are a great place to start.
Why only 3-4 Strategic Pillars?
It’s a natural tendency to feel like you’re “missing something” and add more pillars. However, there are many studies that show the more initiatives you have, the LEAST likely you are to achieve ANY of them. Resist the tendency to add more strategic pillars.
How Often Should You Change Strategic Pillars?
Bryon Jacobs, CTO and co-founder at data.world, was introduced to the concept of strategic pillars while he was at HomeAway, “I was at HomeAway for 10 years. The most important aspect about strategic pillars was how the pillars never changed. We went through a lot of a lot of different iterations as a company – from a relatively small company growing very quickly, making a lot of acquisitions, to going public in 2011. The strategic pillars changed exactly once, by adding one, in that 10 year period.”
“Where I really saw the power of strategic pillars was when we had to add a strategic pillar. We basically said, ‘this set of things that we never change, that we built the business on, we’re going to change them.” Because we were so constant, the one time we did add a pillar, it was able to move what had become a pretty large organization almost overnight,” Bryon said.
Strategic Pillars Examples – Amazon
Amazon is one of the most straightforward examples of the strategic pillars concept. Their strategic pillars are:
- Largest Selection: Amazon wanted to have the best selection, guaranteed to be able to find the product you wanted.
- Lowest Price: Amazon wanted to have the best price, giving you no reason to go somewhere else to buy the same thing.
- Fastest, Easiest Delivery: Amazon knew that if they had every product at the lowest price, the only hurdle would be ensuring a fast, reliable delivery.
You can see this strategy being a consumer of Amazon’s. The fastest, easiest delivery was one of the reasons Amazon created the Amazon Echo – it’s a new way to quickly order the products you want. Since Amazon already had the lowest price and largest selection, you wouldn’t think twice about ordering a product from an Amazon Echo.
What about Amazon’s recent purchase of Whole Foods? It helps Amazon provide more selection (fresh food), do it at a lower price (power of scale) and improve delivery (they now have over 400 stores to deliver from).
How to combat a competitor’s strategic pillars
Once you start to see what a business like Amazon is focused on, you can devise your strategy around their strategic pillars.
Anthony Bucci, co-founder and former CEO of RevZilla, an e-commerce site for motorcycle parts and accessories, explained it like this, “Can we be the Cirque du Soleil to everybody else’s Barnum & Bailey? Where everybody in the industry focusing on an endless aisle (selection), speed of delivery and discounted price? We decided we were going to be price competitive, but we’re never going to be the cheapest. We’re going to focus on service because people need help to choose protective products that are expensive, especially online.”
Buying motorcycle gear can be complicated. It’s not a commodity like toilet paper. Every product is unique with features that work for some riders and don’t for others. Knowing this, RevZilla decided doubled down on customer service. It was common for RevZilla customer service to spend over an hour on the phone (listen to Anthony’s podcast for the full story) to help someone pick the right jacket. Based on their customer service experience, they helped create video content to inform the customer (check out RevZilla’s YouTube Channel) to scale the experience. They also used technology to help the customer experience, too.
Compare and contrast RevZilla’s strategic pillars with Amazon’s:
|RevZilla’s Strategic Pillars||Amazon’s Strategic Pillars|
|Human Knowledge with Amazing Customer Service||Largest Selection|
3 Steps to make strategic pillars effective within your organization
There are three ways to make strategic pillars effective within your business and to make sure they stick.
- The power of repetition over time. “You really need to repeat it over and over and over. Whether it’s in quarterly all hands or whether it’s an executive update to the team the progress that you’re making,” Matt said. Any time you can repeat the strategic pillars, repeat it.
- Report on Metrics and Milestones. “The more you repeat, and repeat your progress against certain metrics and milestones that are relevant to your strategic pillars, the more likely the strategic pillars will stick,” Matt said.
- Alignment. “Everybody in the organization should be able to look at what they’re working on and see which Strategic Pillar they are supporting with their work,” Matt said. The more you can align someone’s every-day activities and workload, the more likely you’re are going to achieve your strategic pillars.
When to start creating strategic pillars within your business
While pillars eventually become very durable, early in your journey you’re probably still trying to figure a lot of things. You can define your strategic pillars too early.
“Until you realize what are going to be your key levers for success and your real competitive differentiators, you don’t know enough to really put strategic pillars in hard,” Matt explained. In his current startup, data.world, “we started having these conversations about what should our strategic pillars be pretty early. But we didn’t cement anything. Maybe once a quarter we would ask, “What have we learned? How has this evolved? What we have recently decided are our strategic pillars for going forward, you can see the ancestry from our earlier conversations,” Matt said.
How do you start with strategic pillars?
The process can seem intimidating or awkward, but the results will be worth it. Any easy way to start is by making it an agenda at your next offsite. Ask your team: “If we only had to focus on 3 things, what would those three things be?” If you’ve got more than 4 people, break up into different, small groups. Have them report back to everyone. Make sure to have them consider what you will be saying “no” to as a result of focusing on only 3 pillars.
You’ll be surprised at how aligned you already are and by great ideas that arise. It doesn’t cost anything but time. But it will pay dividends over the life of your business.