What does the word strategy mean?
Google defines it as derived from the Greek word strategia, which means generalship and refers to leading an army. In the military sense, it means the art of planning and directing overall military operations and movements in a war or battle. In the business sense, it refers to a plan of action or policy designed to achieve a major or overall aim.
An effective business strategy must describe the way you will achieve your goals, the means with which you have to do it, and what achieving your goal will look like in the end. Your business strategy provides a framework for strategic decision-making and provides overall direction for your company.
- An effective business strategy starts with the end in mind.
In order to formulate an achievable, substantial, and effective strategy, begin with the future. Clearly articulate your vision. Your vision is based on your values and core beliefs and is the essential character of the organization.
The values you respect and esteem will guide your vision. Your strategy outlines how you will achieve your vision within the context of those values.
Secondly, define the purpose of the organization in practical and concrete terms. Include objectives that are measurable and goal-oriented. Everyone in the organization should be able to see whether or not their actions contribute to the company’s overall success.
When combined, vision, purpose, and strategy are the basis for successful action. With purpose and vision in mind, stand in the future and look back. Which paths are the most productive paths to the future? Identify those paths and start mapping your strategy.
Focus on what you do best. In Apple’s case, one of the hallmarks of their iconic brand is an exceptional customer experience. It begins with the sleek design of its products, that are intuitive to the user, and extends to its exceptional tech support.
The formulation of an effective business strategy includes the process of writing and implementing policies and procedures designed to achieve your major objectives. It also includes allocating resources to achieve long-term success.
Inertia can build up in the area of resource allocation due to such factors as a reluctance to take risks, the organizational political climate, and too much emphasis on short-term business metrics.
By focusing on what the company did well, Apple was able to make the most of their unique capabilities. Instead of expanding into personal computers, the company continued to target consumers with improved generations of Mac computers.
Rather than becoming a world-class performer in manufacturing, Apple sold its factories and outsourced its production. Apple’s market share and profitability are among the highest in the industry.
Periodically reviewing and reallocating resources to reach strategic goals often results in higher performance. Strategically investing in value-creating businesses activities generates a growth cycle, which, can, in turn, create further investment opportunities.
2. An effective business strategy is clearly understood by all members of the organization and the leadership team.
Create a strategic plan in the form of a document and use it to communicate your organizational goals, the actions needed to achieve those goals, and all other critical elements of your business strategy.
Spend time discussing all aspects of your plan with members of your team. Clearly define the framework of your business strategy and their role in it. Communicating your business strategy can inspire the staff as they recognize the benefits of implementing the plan, and it can motivate them to greater productivity in creatively achieving its directives.
When explaining key concepts, include the role of employees, their assignments, and the time constraints. Assign the use of resources available and establish priorities.
Strategically align your employee’s efforts to support the overall strategy. The process of interacting and synchronizing their efforts can result in increased performance. Your business strategy is only as strong as it is understood and can be implemented by all members of the team.