If you know exactly where you are going, you have a better chance of getting there. This is the key reason why an effective, sound strategy is vital for a successful business. Without it, your business depends on blind luck, which no organisation should bank on.
Strategy in a nutshell
In its simplest terms, a strategy is a clearly defined long-term plan outlining the different aspects of running a business and how it will achieve its goals. It helps us define our business, gives us a set of values and gives it purpose. Think of it like a roadmap that shows our end destination with important stopping points along the way.
Here are some of the main benefits of designing and executing a business strategy.
1. A business blueprint
A business strategy answers important questions such as: How will it run? How does it compete against similar businesses? How many employees are needed? What is the profit potential? These answers all work together to form the strategy.
2. Clarity, focus and direction
If you have a business strategy in place you will be clear on where your business is now, where it is going and what you need to do to get there. In addition, it will also give your employees direction and prevent the business from drifting along without purpose.
3. Confident decisions
Without clear direction, it’s almost impossible to differentiate between good and bad business decisions. Knowing when and where to invest or whether to expand are just a few examples of why having a strategy is so important. It allows you to ask yourself: does this serve our vision and goal of where we want the business to go?
4. Identify trends
A good business strategy can help identify trends and opportunities by examining changes in the market with regards to political, social, consumer behaviour and technology. This allows you to develop tactics in advance which you can modify and adapt to suit these changes.
5. Manage risks and weaknesses
All businesses have weaknesses, but a solid strategy will try to remedy these weaknesses by looking at future risks and help develop ways in which they can overcome potential obstacles.
6. Competitive advantage
A business strategy enables you to implement a unique plan that will allow your business to stand out from your competitors, instead of simply following what every other similar business is doing, which leads to a very diluted market and competitive convergence. Innovation and strategy work in tandem to create an effective business case.
7. Measure success
It can be difficult to measure success without a business strategy, as you most likely won’t know what you’re trying to achieve. For this reason, be sure to include a clear definition of what success looks like to you, as it can look different for different businesses.
Last Words
It’s no secret that the most successful businesses are ones with a solid strategy. They have taken the time to develop a formal action plan, and understand their values and the purpose of their business. They understand the risks they might face, along with a plan to minimise them and possibly turn them into opportunities.
At the end of the day, creating a business strategy is not necessarily hard, but it does take time and focus, both of which can be challenging when you’re caught up in the day-to-day running of your business. The Strategists help you take the important steps needed to design and execute your business strategy.
If you’d like to find out more about our strategy services, please get in touch with us today.