Approach to Analyzing Business Strategy

Many people talk about business strategy but have a great failure to realize exactly what this is – is it surprising that a great deal of business people have a huge problem discussing this when they do not exactly know what this is!

Questions that should be asked may include the determination of the fact that is there even a strategy in existence or if so, is this the correct one? Additionally, how do we determine what a strategy is and how does one go about developing one?

It is important when developing strategy to look at some of the issues and why a chosen path can go wrong-if one keeps doing the same thing, one will get the same results.

Many complaints about strategy range from the fact that it is difficult to determine, it gets messy and unfinished, and many people involved either do not contribute or attempt to dominate proceedings and a general feeling of the future and the failure of any future chosen path.

Broadly speaking, some schools of thought hold with notion that there are three main reasons for a failure of strategy.

Managers often fail to realise what these differences are; business schools talk about corporate-centre strategy and business-unit strategy. Business-unit strategy is for controlled organisations that may be part of conglomerates or single-business units whereas the other is for conglomerates planning growth using single business units.

Another is often no clarity of purpose; for example there is no point in using models that are simply intellectually attractive when the purpose of the task is to discover options and directions and gather proof to support decisions about the future.

The business – unit level requires methods that are relatively straightforward and the only real obstacles are intimidation by “professionals” and their jargon. Most means of analysis are in excess of 35 years old but there is a general lack of understanding of them amongst business people and most of them do not know how to use them.

So how do we correct this anomaly?

Initially, the ground rules need to be set so participants need to arrive with open, clear minds. Strategy may be likened to seeing everything around, from every angle available and even into the future and the following requirements must be met to be successful: Customers are paramount and form the basis of market understanding, practicality must take priority over theory, the business needs of now and the future need to be thought about and the strategy needs to be measurable.

It is worth at this point to touch on the philosophy behind a strategy.

The best place to start is to take the adage of begin with where you want to be and work backwards to where you are now.

If, on the other hand, one believes that strategy is an analytical process then start with where you are and work forwards. However, there is a difficulty with this approach as straightforward arithmetical thinking stifles creativity.

Perhaps, in the real world, a combination of both methods is probably a necessity.

This is all, of course, driving towards growth of the business and that is largely down to marketing. So why are not all growing firms’ good marketers and why they have not developed a good strategy?

Very briefly, this begins with a failure to understand the difference between selling and marketing – marketing is about developing products or services that customers will want where selling is about simply getting people to but the product.

The rest, for the moment, I leave you to ponder on.

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