For any successful business, having a defined and clear vision and set of goals and objectives is essential. Without a clear vision, the survival and sustenance of business are questionable. In a situation like this, business strategy comes into action.
Business strategy precisely refers to a company’s plan of action to achieve its vision, compete successfully in the market while achieving its objectives and optimize its financial stability. Now according to this definition, 4 points are needed to be kept in mind that is to have a visionary approach, have a competitive and goal oriented mindset and work towards a financially stable future.
Objective and strategy are related. The choice of objectives will reflect on how a business strategy will be formulated. A good business strategy will always include an organization’s strengths, weaknesses, opportunities, and threats. In other words, it will include a detailed and well-researched SWOT analysis. It will also reflect on the competitors and market trends in general.
A great business strategy will also increase the brand’s value by meeting all the set goals and objectives. In terms of finances, the goals will be to generate good sales, bring good business and sustain in the industry for a long run by increasing profit. Often business strategy is confused with marketing strategy or financial strategy. Business strategy is a bigger picture that partly includes a firm’s marketing, finance (including the pricing), creative and risk or crisis management strategy as a whole.
Meeting the challenges and threats is an important component of business strategy. No business will be able to survive if it is ignorant of the possible challenges it might face in near future. For long-term sustenance and success in the market, strategists need to be aware of every possible challenge the business might have to encounter and come up with a plan of action, if or when that will arise. It should be a combination of the proactive plan of actions by the management of a firm and appropriate reaction to any unexpected event that takes place in the market, which will affect the business, in most of the cases in a damaging way. The aspect that may hinder the business growth and success need to be considered while making a strategy.
Business strategy can also be divided into various levels such as corporate-level strategy that is deduced by the top-level management in a firm. It includes exploration of newer areas for investment and expansion of the business, possible future merges and collaborations etc. After that comes the business-level strategy which is formulated by officials on a managerial level. The role of a business-level strategy is to formulate the vision and mission of a business into a concrete plan. And last comes the functional-level strategy that includes areas like marketing, human resource, research and development, and finance. This level includes the implementation of the strategy.
A business should always consider making the already existing plans that produced results effectively, as part of the new strategy that is being made. This will keep everything aligned and make practicality of the strategy easier. A good business strategy should cover a time-zone of three to five years at least, making sure that the business will survive in the longer run. Like Partick Dixon has also said, “Business strategy is the battle plan for a better future."
