Does Strategy Matter for Business Success?

Why We Need A Good Strategy

Before we go to answer this question maybe we need to answer the fundamental question of why businesses need a strategy

The answer is about how we can leverage and enlarge the right opportunities to drive sustainable growth as well as the long-term bottom line.

In the mid-1990s, a survey by Arthur Andersen found that companies with a proper strategic plan had 63% higher revenue growth and 100% more profit than those companies without a plan.

The current study explained that three-quarters of the businesses surveyed believe that a written strategic plan causes their business to perform at a higher level.

Hence, by developing a good strategy then we have a better chance of delivering our existing and future revenue, productivity, and shareholder's prosperity.

Nowadays the business environment is full of technological, social, and even political influences which are increasing the downfall likelihood for business.

Nonetheless, successful business performance needs to adapt to the pace of change to stay in the game.

This is the point and also the WHY we need a proper business strategy to explore business opportunities outside of our usual business standards.

How to Bring the Strategy to Reality

When we talk about a good strategy, the common output is a business plan. The strategic business plan will call out all the strategic initiatives to be connected to all C-level's vision.

A business plan will outline how we execute all these initiatives and how expected results that we want to achieve.

In the other words, this business plan will serve as a basis for the organization when it pursues the desired business outcomes.

The business plan will take the way to clarify the feasibility of Vision and enhance alignment within the entire organization.

A business plan also provides a measurable checkpoint for decision-making and serves as a basis for each function.

During my career as a strategic planner, I saw if we can produce a good business plan the chance to focus and proactively create strategic measurable parameters will increase eventually.

The proper process when we set up the business plan also serves as the most valuable effort and will become a good asset culture in the future.

What are the strategic elements that should include in the business plan?

1. For sure, the first thing first element is VISION. This word seems like a fancy word but actually, it does matter for all any major steps afterward. Vision is like Iron Man set up the entire 10 years Marvel Cinematic Universe journey.
2. Then we talk about the mission. Most simply, this is like an elevator to bring the organization to reach the best of the best value propositions.
3. The third is the analysis of competitors and industry. This provides the organization about what is ongoing development inside and outside the industry. This also can be an organization's table league to measure the current and the potential growth.
4. The fourth element is the target market. Strategy without a target market is like shooting something blindly and wasting our resources. This step needs to measure what is the potential, characteristics, why the customer buys our product until we can find a solution to what problem they are trying to solve.
5. Finally, the last but not least is the goals and how success will be measured. This will come to the something that we call Key Performance Indicators.

Once we finish all of these, please create an executive summary, then secure the approval, and communicate the plan to the entire organization.

Ready to start planning?

References:

Porter, M. E., & Locations, C. (2000). Company strategy.?The Oxford handbook of economic geography, 253-274.

Grant, R. M. (2021).?Contemporary strategy analysis. John Wiley & Sons.

Phillips, P., & Moutinho, L. (2018). Strategy. In?Contemporary Issues in Strategic Management?(pp. 25-45). Routledge.