Section 18.2. Defining Business Strategy

18.2. Defining Business Strategy

Over the past few decades, Michael Porter, a Harvard Business School professor and successful entrepreneur, has played an influential role in leading and shaping the field of business strategy and our understanding of competitive advantage.

In his brilliant book On Competition (Harvard Business School Press), Porter defines strategy by contrasting it with operational effectiveness:

Operational effectiveness means performing similar activities better than rivals perform them. Operational effectiveness includes but is not limited to efficiency.

He notes that operational effectiveness is necessary but not sufficient for business success. He then answers the question, what is strategy?

Strategy is the creation of a unique and valuable position, involving a different set of activities.

He goes on to explain that "the essence of strategy is in the activitieschoosing to perform activities differently or to perform different activities than rivals." It is this strategic fit among activities that provides a sustainable competitive advantage, which is ultimately reflected in long-term profitability.

18.2.1. Alignment

So how do we align our information architecture activities with business strategy? Well, we need to begin by finding out what strategies our business is pursuing. This can be nearly impossible in large organizations.

As consultants to Fortune 500 firms, we've rarely had much access to the senior executives who (we assume) could articulate their company's business strategy. And the people we've worked with often haven't had a clear idea about the overall strategic direction of their organization and how their web site or intranet fits into that bigger picture. They've often been left in the dark.

While we wait for the senior executives and corporate strategists to become more involved in their sites, there are things we can do. Stakeholder interviews provide an opportunity to talk with senior managers. While they may not be able to rattle off a concise explanation of their company's strategy, these managers can be helpful if you ask the right questions. For example:

• What is your company really good at?

• What is your company really bad at?

• What makes your company different from your competitors?

• How are you able to beat competitors?

• How can your web site or intranet contribute to competitive advantage?

It's important to keep digging. You need to get beyond the stated goals of the web site or intranet and try to understand the broader goals and strategy of the organization. And if you don't dig now, you may pay later, as we learned the hard way. A few years ago, we had an uncomfortable consulting experience with a dysfunctional business unit of a Fortune 100 firm.

We had completed an evaluation of the company's existing web site and were in the process of presenting our recommendations to a group of senior managers. Halfway through the presentation, the vice president of the business unit began to attack our whole project as a misguided effort. The thrust of her assault can be summed up in the following question: "How can you design our web site when we don't have a business strategy?"

Unfortunately, we didn't have the understanding or vocabulary at the time to clearly answer this question. Our ignorance doomed us to a half hour of suffering, as the VP cheerfully pulled out our fingernails. It turned out that her hidden agenda was to get us to write a blunt executive summary (which she could then pass to her boss), stating that if this business unit didn't have more time and resources, their web efforts would fail.

She was asking the right question for the wrong reasons. We were more than happy to satisfy her request for a brutally honest executive summary (connecting the dots between our IA and their BS), and we managed to escape the relationship with only a few bruises.

The more permanent outcome of this engagement was a personal conviction that information architects need a good understanding of business strategy and its relationship to information architecture.