Why companies like Google, Apple, Microsoft, Salesforce, etc. are so successful. What’s common among these companies apart from their good product. There are similar products too. However, these companies have withstood the test of time and emerged as market leaders in their respective markets.
A good business strategy differentiates successful companies from the rest. Without a strategy, businesses tend to fall off a progressive path and struggle to grow. A well-defined strategy keeps a business on track to goals, by concentrating efforts and allocating resources accordingly. In the absence of a strategy, long term goals are missed and we tend to work towards short term goals.
To explain, how do two companies with the same products generate revenue? The answer is — a different strategy. It could be the way the two products are marketed or their revenue model. Depending on market challenges, customer demographics, and available resources, companies can chart an easier path leading to the desired success.
Need for business strategy
Having a strategy in place, helps businesses know who their customers are. As a strategy defines clear go-to-market plans, customer acquisitions are easier to target. Accordingly, a business can come up with ways to maintain a relationship with customers and increase loyalty.
A strategy also charts out new product development plans, which makes building new products easier.
A good business strategy lays out a clear execution plan. A well-defined execution plan makes operations efficient, increasing productivity across the business. Typically, it defines various teams involved in the operations, their goals, KRAs, and expected output. A robust strategy has additional contingency plans to achieve set goals. Overall, a strategy gives employees a better alignment towards each other’s roles and smoothen team communication.
How to build a business strategy
Building a business strategy isn’t a complex process. However, building a good strategy may be tough. To create a strategy, it is required that you explore and not limit yourself to your own experience and observations. A good strategy will be based on everyone’s perspective, but choose the best of experience.
So to come up with the best possible ideas, talk to team members. Seek their observations and opinion. This will help you to see beyond your own experiences and add a new perspective which might change the course of marketing, development, business operations or delivery. You might be unacquainted with some part of business operations; this practice will overcome that part. It will also open up opportunities for you to see engaged employees in your business.
Focus on results
Your business strategy should be result-oriented. It means you should clearly define the results you want to achieve. Typically, results are defined in numbers. You can define these numbers within stipulated time frames – quarterly, half-yearly, and annual.
Lastly, your business strategy frameworks should lay out a clear execution plan, meaning how it would operate. Various operations that will be required should be clearly defined. Teams and the number of team members and their roles are important parts of the execution plan. Various positions that are required to execute, their responsibilities, their KPIs, and scope of work should be defined and documented. Skills required to perform desired actions make strategy clear.