Business strategy is a blueprint that outlines the goals and tactics of a company. High-level objectives are set that usually include increasing revenue, ensuring business continuity and improving shareholder value (if the company is publicly traded).
These objectives guide project prioritization and other activities within an organization. The strategy also sets the tone for company culture and leadership.
Vision
Forecasting the future of a business may sound like an odd and braggy task, but that is precisely what a business strategy is all about. It's the guiding light that helps a company stay on course in order to achieve its desired goals.
The vision should be a broad overview of the company's goals and aspirations. This can be a challenge for small and medium-sized businesses. In some cases, it can be helpful to invite staff and other stakeholders into a workshop to help create the business strategy.
Avoid using buzzwords or industry jargon when creating a vision. Instead, use plain language that can be understood by people outside of the business. A simple test is to imagine explaining your business's vision to a friend or family member. If you struggle with the clarity of your business's vision, try editing each paragraph individually. Then, get some feedback from stakeholders and make any necessary changes. This process can be a great way to refine your business's vision and make it more concise.
Objectives
Once a company decides on its business strategy, it needs to create measurable goals and objectives. This process includes a SWOT analysis of the company to understand its strengths, weaknesses, opportunities and threats.
The strategy also explains the value proposition, which is how a company intends to create and deliver value for customers. The value proposition can help identify unique benefits for the customer, a competitive advantage for the firm and a win-win situation for suppliers and employees.
Creating strategic business goals can help employees focus on the right things and provide a clear roadmap for execution. This can include establishing goals for customer satisfaction, market expansion or reducing costs.
In addition to the goals, a company should include tactics that explain how the strategy will be implemented. For example, a company may implement a new customer service strategy by improving employee training or investing in new technology to improve efficiency. It may also increase its profit margin by entering a new market or acquiring a competitor.
Core Values
Core values are the guiding principles that support your business goals and help differentiate you from competitors. They guide critical decisions and influence the company culture, boosting morale and productivity.
The core values of your business should be timeless, and they should reflect the beliefs that are most important to you and your employees. They should also align with the company vision and goals.
A company should review its core values on a regular basis to ensure they are accurate and still relevant. This process helps to improve communication within the organization, and it allows managers to identify areas that need improvement.
When defining core values, you should aim to strike a balance between concision (for memorability) and specificity (for actionability). Your company's core values should be a topic of discussion during staff meetings, and they should be incorporated into the interviewing and training processes. You can also make them visible in the company's messaging, materials and software.
SWOT Analysis
The SWOT analysis is an effective business tool that can help you plan and execute financial and operational goals. This method identifies and categorizes internal and external factors that can affect a company's performance, which will lead to more careful and informed decision-making.
This analysis allows you to see a more comprehensive view of your company, which can help you decide how to best leverage your strengths, address weaknesses, capitalize on opportunities and deter threats. It also helps you identify any strong correlations between your internal and external factors, such as if high material costs are impacting profitability or if customer demand is changing away from the product.
The internal and external business environments are constantly changing, so it's important to use this tool regularly to ensure that your business is prepared for future growth. It can also be a great way to evaluate your employees' effectiveness in meeting your International Market Analysis objectives. If you find that they are not effective, it may be time to replace them with someone else.
