Business Strategy

Business Strategy Defined

A full statement of a selected business strategy is a business plan defining:

• the company vision, overall corporate strategy,and objectives
• the strategy and tactics that will enable the company to reach those objectives
• the resources required, and how they are going to be obtained;
• what the main milestones and steps are along the way;
• who is responsible for causing each step to occur;
• what are the company's business risks and external factors that need to be kept under review for indications that a change in strategy or plan may be required.

Modern Theory of Business Strategy

Strategizing is much more than just visioning, forecasting and planning. In the new rapidly changing economy, all substantive issues of strategy have been redefined as issues of implementation. Today, strategizing is concerned with the match between the internal capabilities of the company and its external environment. "The modern subject of business strategy is a set of analytic techniques for understanding better, and so influencing, a company's position in its actual and potential marketplace".

As strategy today is a subject of application, rather than a discipline, the obvious underpinning disciplines for strategy are economics and organizational sociology. You should employ them to define a structure in which the process of strategy formulation and its implementation are bound together.


Working On Your Business

"Most businesspeople are so busy working for their business or in their business that they never find time to work on their business. Thus they fail to anticipate what might happen or what they might be able to make happen."9 Unless you regularly schedule time (one-day out-of-the-office meeting a month at least) to work on your business and answer critical questions, you'll never achieve your stretch goals.


The Methods of Business Strategy

According to John Kay4, methods of business strategy require:

1. Looking inward: strategic analysis of the characteristic of your company to identify your distinctive capabilities and surround them with a collection of reproducible capabilities, or complementary assets, which enable your company to sell its distinctive capabilities in the market it operates.
2. Looking outward: strategic analysis of the industries and markets in which your company operates to identify those markets in which your company's capabilities can yield competitive advantage.

The questions are twofold:

1. What are the origins and characteristics of the successful fit between capabilities and environment? Why do companies succeed?
2. How can companies and their managers make that fit more effective? How will companies succeed?