“We usually think of a business strategy as some sort of aspirational market positioning statement. Doubtless that’s part of it. But I believe that the number one strategic strength is excellence in execution and systemic relationships (i.e., with everyone we come in contact with).” – Tom Peters
“Strategy is the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations”. – Johnson and Scholes, Exploring Corporate Strategy
Creating your business strategy is the process of identifying the company’s goals, defining strategies and initiatives to accomplish these goals and then allocating resources to accomplish these goals. Your business strategy is a 2-5 year plan, developed by business owners and business leaders that guides the future of the business and outlines the long-term direction for the business, which is written down and reviewed every six months. It includes:
- SWOT (Strengths, Weaknesses, Opportunities, Threats). The organization’s Strengths, Opportunities, Weaknesses and Threats (SWOT) both internal and external to the organization.
- Mission. A brief compelling statement of an organization’s purpose.
- Vision. Conveys the future picture of success for your business.
- Values. Basic principles that guide behavior and establish the company culture.
- Business Strategy Goals. Defined and measurable goals which are realistic and attainable. Usually 2-4 goals in each area are sufficient to outline what the organization needs to accomplish. Remember that business units and departments will break this down further with goals in their particular areas that support the strategy goals.
- Financial Goals. The most important goals for the company outline the financial targets over the business strategy time period. All other goals in other areas must support these goals.
- Customer Goals. The required customer goals which will result in the necessary sales to accomplish the financial goals.
- Products & Services Goals. The goals for delivery and support of the product/services which will result in the necessary sales to accomplish the financial goals.
- Partner Goals. Goals for the strategic partnerships which will deliver the required product/services or customer results.
- Employee Goals. Goals for the required employee training, development, productivity increases and retention needed to support delivery of the organizational goals.
- Internal Goals. Goals for internal systems efficiency improvements which will enable the organization to deliver on the outlined customer and product/service goals.
- Community Goals. Goals that focus on giving back to the community, volunteering, philanthropy, engaging local businesses, and/or protecting our planet and natural resources.
Business Strategy Outcomes. The following are required outcomes form the business strategy process which will be inputs to the organization’s Technology Strategy and other planning activities.
- Strategic Initiatives. These are 3-5 company initiatives that will help accomplish the company goals. The organization must align behind these initiatives and help them be successful. Executive ownership and sponsorship should be assigned to each strategic initiative and cross-functional team assignments made to ensure the success of these efforts.
- Strategic Business Processes. These are the strategic business processes which will support the company goals and strategic initiatives. It is likely that the activities that have to occur to accomplish the company goals will require modifications to these key business processes. These processes must be identified, documented, owners established and potentially cross-functional teams assigned to support the modification of these processes to support the business goals.
- Strategic Business Applications. Supporting key business processes is inevitably a set of technologies that help run the business. It is likely as you implement new business processes, these applications must be enhanced, modified, or integrated in new ways to support the new business processes. These applications must be identified during this process to help the business prioritize required IT activities.
This discussion outlines a high-level exercise to help you complete your business strategy at the company level. The same exercise can be completed at the business unit or departmental level. There are many more in-depth materials and resources available to help guide you through this process at a deeper level. In addition, there are many consultancies that can help facilitate this process for you. The materials and process provided here are intended to distill the business strategy exercise down in to an understandable and manageable process in order to obtain the required inputs in to the company’s Technology Strategy.
Above is the format for the business strategy that I have used in the past that is relatively simple and conveys the essence of the strategy in an easily communicable manner. Here is a completed, sample business strategy for a ficticious company that you can reference throughout this section.