Business strategy development is essential for any successful, profitable company. And to create a strategy that works takes time and know-how. Whether you鈥檙e considering applying for graduate programs in business or about to start a new entrepreneurial venture, understanding business strategy, strategic planning, and business development will be key to your success in today鈥檚 corporate environment.
In this guide, we鈥檙e diving in to explain how to create a proper strategic plan. We鈥檒l break down business strategy development and all of the elements you鈥檒l need to build an ironclad strategy execution and action plan that鈥檚 aligned with your business growth goals.
What is Business Strategy Development?
First, let鈥檚 define business strategy. A business strategy is a set of company goals and approaches the company can use to achieve those targets. A business strategy can be a roadmap for company progress, a flowchart of 鈥渋f-then鈥 scenarios, or a decision-making tool.
What are your business goals? How will you achieve them? These questions are at the heart of the business development process.
Business strategy development has to be just that鈥strategic. Since there are so many open-ended questions to contend with in strategy development, you鈥檒l need to formulate a strategic plan to help you stay focused.
6 Key Elements of Business Strategy
While this is just one approach to business strategy development, it provides a strong foundation for solidifying your company approach. Since defining your clear vision is critical to your business growth and business success, the strategic planning tactics below are designed to help you create that vision and align it with your goals.
#1 Conducting a SWOT Analysis
SWOT is a simple acronym with ample value for new business owners:1
- Strengths 鈥 Identifying your brand鈥檚 biggest strengths can help you lean on your assets during the strategic process鈥攁nd throughout the life of your business.
- Weaknesses 鈥 Take a fearless inventory of your shortcomings as a team and brand. These are the pitfalls that your strategy should help you avoid as your business grows.
- Opportunities 鈥 What opportunities do you have to succeed in the marketplace, your community, and your industry? These should become a map of possible options to consider when it鈥檚 time to grow.
- Threats 鈥 What does your competition look like? How could your weaknesses threaten your business鈥檚 success? Outlining these will help you prepare for them.
This acronym encompasses internal and external factors that can (and likely will) impact your business.
#2 Identifying Competitive Advantages
As you mull over your strengths and opportunities, start drafting your brand鈥檚 unique value proposition (UVP): the one-of-a-kind competitive advantage your business has over your competition. In other words, this is your 鈥渟ecret sauce.鈥
Common UVPs include (but aren鈥檛 limited to):
- Highly unique or specialized products
- Exceptional product or service quality
- Definitive team expertise and credibility
Your UVP should become the center of everything: your strategy should revolve around highlighting, protecting, and advancing your UVP.
#3 Formulating Actionable Strategies
You鈥檝e completed a SWOT analysis and identified your UVP鈥攏ow it鈥檚 time to create an actionable plan for strategy execution.
A few guiding questions can help you develop your step-by-step approach:
- How are we going to make this product/service?
- How many people will we need?
- How will we get this product/service into our user group鈥檚 hands?
- How will we fix problems with the product/service as they arise?
Don鈥檛 forget to acknowledge your SWOT analysis as you ask your team these questions. For example, if communication is a weakness among your team, plan how to communicate if problems arise with your product. This will be the plan to fall back on to solve problems efficiently.
#4 Implementation and Monitoring
Once you鈥檙e ready to implement your strategies, there are a few things to remember to smoothly bring your strategy to life:
- Order tasks by importance 鈥 Order matters鈥攔efine your timeline (and backup plans) down to the week.
- Check-in frequently 鈥 In the beginning, check in regularly with your team to see how the implementation is going.
- Enact backup plans as needed 鈥 Growing a successful business requires flexibility. Make backup plans, and lean on them when Plan A falls through.
- Start measuring 鈥 Collect as much data as you can as you progress; you鈥檒l be able to track your progress objectively over time. Data analysis becomes important in guiding the strategic direction. Therefore, effective strategy relies on understanding business intelligence and data analytics, two pillars of modern business strategy development.
#5 Adaptability and Flexibility
Flexibility is worth mentioning again鈥攑articularly when dealing with external factors outside your control.
If one of your suppliers raises their prices or order minimums, what鈥檚 next? Flexibility is much easier when you have fallback plans in place. Contrary to what you might think, flexibility is about using your planning and resources wisely, not winging it and hoping for the best.
Make as many backup plans as possible, and don鈥檛 be afraid to implement them as soon as needed. This will help you maintain your timeline and meet your goals as expected.
#6 Communication and Alignment
During the strategic process and as your business grows, communication with your fellow stakeholders will help you maintain alignment of both:
- Your team values 鈥 Are your partners still invested in the values you documented during the strategic process? If not, how does this change your plans?
- Your brand values 鈥 Do your decisions still reflect the strategy you and your partners detailed during the planning phase? If not, do you need to change your strategy or your actions?
Broaching these topics often and transparently will prevent conflict, help goals stay aligned, and support team investment.
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This is just the tip of the iceberg regarding business strategy, there are as many theories and approaches as there are businesses, and today鈥檚 foremost corporate minds know how to navigate them to help businesses grow.
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Sources:
- Will Kenton. 鈥淪WOT Analysis: How To with Table and Example.鈥 Investopedia. October 30, 2023. . Accessed February 19, 2024.
