Over the past decade, manufacturers have spent countless dollars to send their employees off to learn new ways to make the organization operationally effective. Articles, seminars, and conferences have turned many of us into true believers of such concepts as “lean,” “continuous improvement,” “Kaizen,” and “Six Sigma.”

But while operational effectiveness is essential to business success, manufacturers can’t achieve success by this means alone. A company must have a direction. A company must have strategy.

Michael E. Porter, Harvard Business School professor and world-renowned expert on strategy, notes that success requires both operational effectiveness and the right strategy. According to Porter, the two concepts are in fact, complimentary.

Direction, differentiation and choices

“Things around here change too fast; our strategies can’t keep up.” This is a common sentiment in the manufacturing world. It’s also unfortunate, because a rapidly changing environment demands that manufacturers have a steadfast strategy.

Strategy is about direction, differentiation, and choices. It is your business’s stake in the ground. As business continues to move faster and expand to new places, strategy will be the only thing that creates a sustainable advantage in the marketplace.

Operational effectiveness is about doing things better and often includes things that all businesses should be or are doing. However, strategy is what makes a business unique -- and clear differentiation is the basis of competitiveness.

The pace of the marketplace has accelerated alongside the pace of global communication, and customers are increasingly impatient as well. Making business decisions at breakneck speed may seem overwhelming, yet it is necessary in today’s business environment.

In fact, a solid strategy can simplify the situation. Business decisions need to reflect the company’s set direction. As new paths are offered to your company, its strategy will identify the course that will continue to best serve the interests of your customers in a way that makes your business competitively different. High-performing companies in all industries demonstrate that it is dedication to their strategy that defines their continued growth and success.

Making your strategy work

Company leadership is responsible for establishing, communicating and protecting the strategy for the organization. It is this group’s vision that will set the direction for the company.

The greatest strategies are of no use unless they are utilized, and your management team can’t do this on its own. The manufacturing industry has experienced movements in empowerment and involvement of workforces. This inclusion of employees in the workings of the business is especially important in the implementation of company strategy.

Your employees make decisions every day that impact your business and your customers. Without an appreciation of the company’s direction, these decisions will not be in concert with the leaders intentions. Company leadership must take on the role as educator and share the company strategy with all employees so that they understand the company’s direction and how they can help the organization accomplish its goals.

Leadership must also serve as strategic protectors. Every day, manufacturers are presented with new ideas from employees, suppliers, and customers. However, only a tiny percentage of these ideas are consistent with the company’s strategy. Leadership needs to define the trade-offs of new ideas so that each choice and initiative adheres to the sustained direction of the company.

In a time when manufacturers are faced with increased market pressures and fast paced industry changes, companies need to look to their strategy as their competitive advantage-building and decision-making tool.