By Guy Rigby, Head of Entrepreneurs at Smith & Williamson
Having a great strategy will not necessarily lead to business success, but a poor one will almost certainly prevent it. Strategy goes to the heart of a business, determining direction and the actions you take on a day to day to basis. Get them right and your business will probably fly. Get them wrong and, even if you survive, you will forever be pushing water uphill.
Notably, the word ‘strategy’ is of military origin, derived from the Greek word “strategos”, which roughly translates as leader or general. It refers to a plan of action to achieve a particular goal, acting as a guide and dictating both direction and scope. In business, strategy embodies our vision of where we are heading and how we will get there, aligning our intentions with our expectations and values.
As David G Thompson, author of Blueprint to a Billion: 7 Essentials to Achieve Exponential Growth (www.blueprintgrowth.com), says, “the journey to achieving exponential growth—across, up, and down economic cycles — is rarely a smooth one.” For this reason, it is essential to have a well-defined and carefully considered strategy to guide you through the ever-changing business landscape towards the goals you want to achieve.
Strategy is shaped by our knowledge, experience, relationships, resources and competencies and our assessment of the best way to leverage these; it is shaped too by our vision and values. Strategy is always emergent, responsive to market conditions and customer needs and altered by fresh opportunities and threats.
Once you have determined the overall strategy for your business, you will also need to consider your sub-strategies. For example, there is operational strategy (how you organise your business in terms of processes, resources and people), product strategy (how you will source and deliver your products or services), marketing strategy (how you will raise awareness and stimulate demand), financial strategy (how you will structure and finance the business). In short, strategy has an important part to play in every area of your business.
So how do business leaders create successful, workable and achievable strategies for their businesses?
For me, there are three key stages:
1. Vision: The vivid mental image and perception of your end game. Knowing where you're heading and being able to see your destination in your mind’s eye.
2. Strategy: The means by which you will pursue your goals in order to achieve your vision over time.
3. Tactics: How you will implement your strategy. The actions you will deploy on a day to day basis to assure the delivery of your vision.
Envisioning a worthwhile future has long been a key motivator for successful business leaders who go on to develop their strategies and tactics to bring their visions to fruition.
Amazon is a great example of this. Despite investors thinking he was crazy, on realising in 1994 that web usage was growing exponentially, Founder Jeff Bezos’ vision of the future of e-commerce was clear. His founding dream and vision was to become the best retailer on the internet and “build a book store with universal selection”; a store without walls that he hoped would become, “Earth’s most customer-centric company.”
His belief in this vision was so strong that he resigned from his highly paid job to establish Amazon.com and sell books over the internet. The site subsequently became the largest retailer on the internet and a point of reference for all online retailers. Amazon has seen an astounding rate of growth with well over 100 million customers worldwide, buying everything from books and music to clothes and DVDs. This is because Jeff Bezos didn’t just dream his vision- he also created a strategy and deployed the tactics to implement it.
The strategy was twofold, offering both an improved choice and experience and, crucially, cheaper prices. Recognising that the fundamental problem with a traditional book store was its size, his strategy involved creating a store without walls on the web with a universal and almost unlimited choice; an interactive online environment and experience for customers which superseded anything that a traditional book store could offer.
His tactics included building an unrivaled payment platform, offering purchasing recommendations based on consumer buying habits (and the buying habits of consumers with similar tastes) and, ultimately focusing on the customer experience above all else.
So what’s your vision? What’s your strategy? And what are your tactics?
For further information on strategic thinking please email Guy Rigby at firstname.lastname@example.org, or call 020 7131 8213.
By necessity this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Article correct at time of writing.
Smith & Williamson Limited
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