Business strategy plays a part in our lives in many ways. You can have a “plan” – an idea of how you would like a situation to play itself out, but with out a clear, detailed business strategy, your plan will go nowhere.
Look at professional sports, for example. These guys are all “experts’ in their sport, however, without their coaches providing them with well-thought out strategies, their good skills would not get them very far. The same holds true in the world of business and sales.
So why is having a business strategy really so important?
Strategic management lays the groundwork for proper planning. Without an all encompassing strategic plan, many companies simply go day to day, putting out one fire after another.
Company wide goals and objectives need to be aligned with the overall purpose and business strategy of the company. If it doesn’t it will lead to lead to one department’s idea of success that is entirely different from another.
While establishing these “goals”, always challenge yourself to think of ways to become a definitive market leader in your industry. And, I have found that sometimes the hardest part is not in coming up with actual strategies to meet these goals, but the most difficult part can sometimes be in just knowing where to start, and how to effectively “get the ball rolling”.
Strategic management is an ongoing process. You never have a successful business strategy that you put forth that will not need to be adjusted along the way. Stay on top of the process AT ALL TIMES. Know what your competitors are doing so that you can always make efforts to stay one step ahead of them.
Tips for An Effective business strategy
First, they have to be clear and specific as to what is trying to be accomplished, and they need to be achievable. It’s great to set goals that will challenge all those involved, but make sure that the goals are within reach and realistic.
Another important part of effective strategic management is being able to measure the outcome of those strategies, in order to know if something is driving your business’s success, or if it is driving it’s failure.
One of the last, but equally important part of an effective business strategy is time management of the project. Can you really deliver what you say in the defined timeframe?
These are all very simple statements, but very important for any business strategy. What worked for your company 5 years ago, or last quarter, may no longer apply to today’s environment. Don’t be like so many companies that wait too long before making crucial changes to their business strategy. Talk to others in your industry to know what is going on at all ends of the table. Do not let your many years of experience – and the larger ego that sometimes comes along with it – deter you from staying open minded to newer, better, more effective ways of getting and growing business.
Tunnel vision in a business strategy can run rampant among some levels of management, and can be a “death sentence”.
I’m sure that almost everyone reading this has felt this way at one time or another.
Take a minute to think about What percentage of time you spend focusing on strategic activities that will move your business forward? If you track how you are actually spending your time, the answer will probably surprise you.
I once read that Warren Buffet once said, “The difference between successful people and very successful people is that very successful people say NO to almost everything.” Very successful people force themselves to focus on what is strategically important and eliminate everything else.
Great point. With so much time spent putting out “fires” in our business, and so many ways for small “distractions” to eat away at our day, we must resolve to not let any of it prevent us from whatever our goals are at that moment. Do first things FIRST, and learn to say “NO” to anything else. We are never going to have more hours in the day. Learn how to differentiate between what is important, and what isn’t.
There are tools that people use in every field. To master finance one has to learn discounting, option pricing. To become a marketing expert, you need to learn ways to estimate the market response to price, promotion, and advertising and accept the discipline of thinking about how the world looks through the buyer’s eyes. In working to create a business strategy , the key tools are frameworks that are designed to spark and guide insight.
In reality, strategic planning is a way of making you think long and hard about how to find your unique fit. If you consider a strategic plan merely a guide that is a constant “work in progress”, rather than a formal document just to be presented to the “bosses”, there is a higher probability for it to be successful.
Writing a business strategy is not always easy.
I want businesses to survive and grow, and want to help anyone who needs it, as well. I welcome anyone with a question about their business strategy to contact me for a free conversation.
So you need more help on your business strategy ?
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Marco Giunta
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Ken Moore, IT Job Search & Resume Specialist • The same holds true in the world of careers, job search, and resume development. A career and job search should be treated as a business backed with a strategy.
Muhammad Pasha • Infact strategy is the mind of any activity. so its crucial to have a brilliant mind.
Pedro Siena Neto • Marco, it is good to know you're aware about the time management of the project. In our company we put many efforts on clear goals, and metrics but we didn't consider it as important. Easy reading text. Congrats!
Dan McGrath • At a kickoff meeting for the IBM Strategy community back around 2000, Lou Gerstner spoke to this very question. Here are Lou's principles of effective strategy:
(1) Know the Problem You are Trying to Solve: Strategy is stimulated by dissatisfaction, the perception of a gap between current and desired results. A
performance gap is a quantified statement of the shortfall between current business results and those that were expected. An opportunity gap is a quantified
assessment of the discrepancy between current business results and that which can be achieved in the marketplace. Identifying the gap is the first major
undertaking necessary for effective strategy. The second is understanding what's causing the gap – and eliminating the cause to close the gap.
(2) Ensure Fact-based Analysis: Solid fact-based analysis helps us to avoid relying on abstract academic theories or narrow anecdotal evidence. Debate
quickly focuses on an issue or opportunity, not on whose opinion or facts to believe; emotion is replaced with more reasoned business logic. For example,
IBM's Global Market View creates a baseline five year view of market spending by industry, product class and customer size for all major countries.
Augment internal market research with external data from selected specialty research institutions.
(3) Understand Customer and Market: The landscape is littered with well-known companies who have failed to perceive critical shifts in the sources of
customer value. Technology companies especially run the risk of becoming so enamored with the dazzling performance or technical ingenuity of their
products that they subordinate customer usage and value issues. So focus first on business value before addressing technology.
(4) Develop Deep Competitor Insights: Business strategy has traditionally adopted battlefield metaphors for a reason: at the center of the free market system
there is an intense competitive battle to attract financial and intellectual capital and to capture mindshare and marketshare. Effective strategy requires
competitor insight beyond product features, channel activity or pricing tactics, toward an in-depth understanding of competitors' inherent strengths and long
term ambitions. This activity is even more complicated in the emerging digital economy where nontraditional competitors more easily cross industry lines.
(5) Encourage Breakthrough Thinking: Leadership or "market shaper" strategies can create extraordinary financial rewards, especially in businesses
benefiting from increasing returns economics. Ask: How can we create strategies that go beyond incrementalism or imitation of competitor strategies, and
toward innovative, unique ways to deliver customer value? How can we create new markets rather than just participate in established ones? And how can
we combine and leverage the capabilities of our various business units, functions and business partners to create differentiated solutions?
(6) Lead from Strength: Lead from a recognized business strength that is aligned with customer value. What are the capabilities embedded in our people,
processes or technology that are clearly superior to those of our competitors? Which of these strengths do our current and prospective customers recognize
and how can we capitalize on our strengths to build our brand promise?
(7) Focus on Execution and Timing: Many companies believe they have terrific strategies, but poor execution. This common lament misses a critical point:
the best strategies are those that take organizational capabilities and market timing into account. An innovative strategy that is too complicated to grasp,
depends on too many uncontrollable variables, requires Herculean efforts to execute or lies well beyond the core capabilities of a firm simply won't succeed.
And most strategies executed after a market has been defined and competitors are well entrenched are doomed to failure.
Siva Ramasamy, PMP®, MBCS CITP • I agree with you Dan. It was amazing how Lou Gerstner turned around IBM and I still refer to his book "Who Says Elephants Can't Dance".
Ian Mills • There's only one required characteristic – it worked.
Like when is it valid to rise up against a demoratic government – when you win.