A great strategy for growth springs from a clear purpose, meeting these five tests:

1. It comes from outside the business first, inside second: informed and shaped by the marketplace and by customers, not defined by brand or business ambition.

Creating profitable growth through differentiation starts with customers. Customer is the only non-negotiable shared reference point across all parts of a business. This is about getting true insight not just asking customers what they want or what you should do. Why not brand? Because brand is an outcome not the starting point. Even though people will express the differentiation as a brand statement/ vision or whatever, and even customers will say it’s a brand they admire or like, that brand is only the outcome of the business’s consistent behaviour over time, to offer and deliver something people value and to do it better than competitors. Similarly, values are a way of achieving your purpose, and shareholder value an outcome, like brand. They all matter but customers are the starting point.

2. It defines a meaningful role for the business which employees are proud to share.

Define what you do for customers, not who you are as a business. So the focus shifts from who you are – brand – to what you’re for – purpose. Call it your customer aim, business purpose, reason for being, differentiation, proposition… as long as it’s externally focused, and something that customers want too. It’s an unselfish strategy, not self-oriented, one that people can talk about and strive for openly and with pride. They can feel good about what they do, get excited and inspired, make the right choices independently, ie be empowered and still aligned. It entitles your business to profitable growth.

3. It draws on the company’s unique history and character, reflected in the stories people tell about it.

This is what makes the chosen strategy right for this business – because it’s in your DNA. The stories people tell about how a company started, how it coped with adversity, what makes it a great place to work, and so on – these represent the uniqueness and the heart of the business, and help identify its essence. A growth strategy that taps into these will intuitively feel right and credible – to that extent it does come from inside as well as outside. It can be hugely ambitious and still achievable, if it feels true to the business.

4. It can be expressed simply.

If it meets a genuine need then this can easily be explained. It’s essential, too, so that everyone inside the business knows what they are trying to do. Brilliant ideas that aren’t implemented are no use at all – better to have a fair strategy that is acted on coherently across the business than a brilliant idea that isn’t.

5. It is supported by your customers.

Customers want it to succeed. There is no shame in being ambitious for the business because it is doing something people want. There is total transparency between the ambition of the business and its external face. There’s nothing said or done internally that you’d be embarrassed for customers to hear.