To be successful means knowing how to use your talent and resources to your best advantage; and thus, to win at anything worthwhile, you need a game plan. Your business is no different. Before you jump into the deep water of establishing your business, it is important that you have a proper plan to do so, otherwise failure is inevitable. Here in this article, we have provided you a comprehensive guide to creating a business strategy that guarantees success for you.
What Is A Good Business Strategy
A business strategy is essentially a collection of all the decisions you make to reach your business goal, and beat as well as stay ahead of your competitors. All business strategy consultants will tell you the same thing – if you are entering a market with no good strategy, you are practically gambling with the future of your company. Most of the time, you get to know about your real strengths and weaknesses while formulating a strategy; hence you can devise a plan to deal with them effectively. A constructive business strategy helps you communicate your goal to your investors to secure your resources, and the management to get the job done. Most importantly, just like chess, heading into the market with a strategy in mind gives you a realistic idea, and therefore, overall control over everything that you need, together with everything that you can accomplish.
So A Good Strategy Will Include –
- A clear description of your business aims,
- your business ethics, and
- Your action plan in order to reach your aim while maintaining your business ethics.
Understand The 3 Basic Principles Of Creating A Business Strategy
If you contact a strategic business consultancy for helping you, they will take care of this part; yet before you start making a strategy, you, yourself, should understand what exactly constitutes an effective business strategy – the three basic principles you need to keep in mind while building it.
Your Business Offering And Future Prospects
When you are offering a product or service to anyone else, first you need to have a clear idea in your own mind about what that product/service does as well as what it is capable of doing – what value it can bring to a community; the core ideas that give the business substance, shape, and direction. Every move you make depends on this basic concept: so you need to define your business’s identity.
Next you need to understand your business goals correctly and realistically – what you are trying to accomplish through your product/service along with where you want to see your company in the near as well as far future. You will need to gather enough data to identify the growth opportunities your kind of product/service, and how it may change with evolving technologies and/or time.
Once your vision statement is written, you need to focus on your competition and figure out what is or can be that unique quality of your business that will differentiate your company from those of your competitors. This really does not have to be something overwhelming; it can be a special feature of your product, or it can even be as simple as the best customer service in the industry. This one plain approach can make a huge difference in making a huge loyal customer base; and therefore, can make or break your business.
After this, you need to understand and define your focus market: that is, the target audience for the product or service you offer. Realistically, no matter how amazing and unique your product/service is, not everyone is going to be a fan of it; there is always going to be a section of the population it will bring value to. This is the population that will bring you loyal customers where the churn rate will be the least. They are the ones who will also be your automatic referrals, so once you have gained their trust, you can acquire more new buyers without putting in a lot of resources into marketing.
This niche can be a particular buyer group, a segment of the product line, or geographic market. Once you do this, you can assess this audience’s persona, focus resources, and determine your marketing strategies accordingly; which in turn, enhance your sales productivity.
How To Choose An Effective Business Strategy For Your Business
Now that you are clear about what to work on while creating a business strategy, it is time to decide how to make one that will be the right fit for your business and at the same time, will bring in the highest amount of profits. You can, of course, call up a professional business strategy consultant to assist you through the entire process.
Put yourself Into A Problem-Solving Mode To Develop Efficient Solutions
Creating a business strategy, at the end of the day, is nothing but a problem that you are trying to solve. So don’t get into a long-term objective right away; break it down to smaller pieces, and approach each of these one at a time. Create short-term targets and action plans, and then add them all up – you will find a solution to the big problem. Once you put yourself into a logical problem-solving mode like this, all your performance anxiety will go away, and solving the problem will become much easier.
Identify What Exactly You Are Trying To Accomplish
First understand what the objective of all areas of your business is and highlight the priorities. You need to realize at this point that the business is actually not about you, what you want or can gain from it; it is really about your customers – what they will gain from the product/service you sell them. So figure out the problem that your product can solve for your customers. Theodore Levitt puts this in an interesting way in his pivotal piece “Marketing Myopia”:
“People don’t want to buy a quarter-inch drill, they want a quarter-inch hole.”
Then create your business’s identity around this particular problem. Do a SWOT analysis for your own company and identify your strengths and weaknesses, and work out your modus operandi.
Do A Thorough Resource Assessment
Even though the business strategy consultants you may hire will keep a thorough record of everything, as the business owner, it is your job to know about all the resources you have at hand so that you can determine an effective way to allocate them, along with learning on time about any hole in the system. These resources can be anything from existing production capacity and the infrastructure to support it, and the existing service delivery capabilities to the access to capital, or sufficient working capital for product research and development, marketing programs, or infrastructure upgrades.
Your next strategy scheme, as well as your budget, relies heavily on this analysis.
Prepare To Effectively Beat Your Competition
No one is going to buy two of the same or similar product. So you need to draft a way to be ahead of your competition. There are a number of ways you can do this, taking lessons from the biggest companies in the world:
- One way is, of course, choosing a market where you would be the first one to arrive. Here you will capture the entire market share, build your brand and position your company well in that marketplace, making it harder for any new entrants.
- Another way is to be better or different than your competitors in terms of product/service specifications and features. Being the best in the market and/or bringing in a unique value for your customers certainly pays off.
- When none of these can be accomplished, another powerful policy is to be innovative in cutting the cost of production and thus sell your product/service at a much cheaper price than your competitors, and still make a profit. In this case, you will also have to pay close attention to which types of teams and employees you would need to beat your competition while sustaining your product/service’s quality.
- Another approach is to buy all the existing or potential competitors just like Facebook did with WhatsApp and Instagram.
Determine What Kind Of Management Strategy You Will Require
Your managers are the bridges between you and your other employees. They need to understand all the above viewpoints as much as you and concoct the most effective way to make your employees work towards the highest as well as the healthiest productivity. Your employees make your product better and your managers make your employees better. So you need to personally look into hiring the right managers.
Deploy “Trial And Error”, Measure The Errors, And Fix Them
You will need to periodically review and update your strategy to ensure that it is valid at all times and meets your company’s objectives and market needs. So you will need to determine the right measure metrics for each tiny phase and keep them regularly in check. You can do it yourself, but it is a long and time-consuming procedure. You can outsource this data collection and analysis task to an expert strategic business consultancy.
Be Transparent With The People That Your Business Depends On
Once you have outlined the whole scheme, share it with the employees in your organization so that they remain informed about all the initiatives they need to take from their side to make your business a success. In addition to this, prepare a separate proposal to share with each of your external stakeholders like investors, partners, suppliers, industry analysts and your customers. All of them need to know how your company plans to gain profit for them. Do this regularly for every single update. This way every single one of these participants obtains respect for you and therefore, stand on your side to make your company a success.
Knowledge is power, especially when it is about yourself. Learning every single detail about your company and its market will benefit you immensely in the short as well as in the long run. More importantly, starting out with a proper business strategy is what is going to take your company for the long run. So you can understand the critical nature of this job. So especially if you are new to the business world, it recommended that you connect with a certified and experienced strategic business consultancy for laying out strategic plans for your business.