Your business needs a strategy. But how do you come up with one?
To answer this question we should dig deeper in the different frameworks used when designing a strategy. The list is very long and includes purposeful positioning, SWOT analysis, Porter’s 5 forces, innovation leadership, game theory, 4 actions framework, blue/red ocean strategy, operations design , SHRM and others. Sounds difficult, hey?
Let’s take these concepts and build something out of them. Some questions to ask yourself when designing your business strategy are:
Corporate level strategy - What market are we in?
Business level strategy - How do we keep/grow our market share? What’s our strategic posture?
Product/service strategy – What is the right mix to achieve our goals?
Function level strategy - What needs to be done on a daily basis to keep/grow our market share? Do we have the right operations model?
Horizon 1 Strategy (next financial year) - How do we commercialise our current products or services to achieve our short-term financial goals?
Horizon 2 Strategy (next 2 to 5 years) - What are the high-growth opportunities in the market that we’ll need to add to our core offering? How do we put them in the market?
Horizon 3 Strategy (next 5-10 years or longer) - What are the long-term germs of new business in the far future? How do we develop them?
Implementation strategy – How we make it all happen? (one of the most important parts).
Some of the key elements to consider across horizons and levels of strategy are: value proposition, key partners, activities and resources (including human resources), clients / customer segments and relationships, marketing channels, revenue streams and cost structure.
Finally, a careful external analysis with a focus on industry analysis should be performed. For instance, the macroeconomic situation (e.g. a pandemic) and the level of market competitiveness can deeply affect your business strategy.