The company’s business strategy is a document that describes the company’s long-term development plan. Some refer to this document as a business plan. And, in fact, in part, the points from the business plan intersect with the issues from the organization’s business strategy. But still, the business strategy is based on the company’s goals in the medium term (1-5 years) and long-term (10-20-30 years), as well as the company’s mission.
Formulation
Before creating a business strategy, figure out what you want to achieve. Then, throw away all your knowledge and thoughts and completely surrender to the will of fantasy: where do you see yourself in 5 years, how your business is developing, and where it aspires to. Since business strategies are formed years in advance, it can be helpful to think ahead about where you plan to go.
Analysis of the situation
Situational analysis (SWOT-analysis) identifies the organization’s strengths and weaknesses, as well as external Opportunities and Threats affecting its activities. This analysis should be an integral part of every company’s strategy development. Information about external opportunities and threats can be obtained from various sources: buyers, suppliers, bankers, acquaintances working in other organizations, consultants, government reports, specialized magazines, at meetings of association members.
Many companies use the services of specialized firms that compile newspaper articles and analyze trends in domestic and international markets. Some companies resort to sophisticated methods of obtaining information about competitors: interviewing job candidates, poaching employees, interviewing former employees and buyers of competing firms, posing as tourists or potential partners, attending factory tours. In addition, many companies use the services of professional competitive intelligence.
Strategy planning
You have to choose one of three strategy options. Growth strategies are based on sources of internal (investment in development) or external (acquisition of new business units).
The stabilization strategy (or pause strategy) involves slow, tightly controlled development and a simple continuation of the business. Usually, this strategy is resorted to after rapid growth. Management’s attention is focused on establishing business processes and the interaction of business units, ensuring the effective operation of the organization as a whole.
A downsizing strategy means that the organization is going through a downturn and is either reducing the number of its divisions or selling or liquidating entire lines of business.
Implementation
The strategy has been formulated, and we are starting to implement it, that is, to use managerial and organizational tools and resources to achieve strategic results. The implementation process is the implementation of the strategic plan. To turn a strategy formulated on paper into reality, you need equipment, resources, possibly changed organizational structure and pay system, and finally, convincing employees of the appropriateness of the actions taken.
Formation of an anti-crisis strategy
The technology for forming an anti-crisis strategy is no different from that described above. At the same time, it should be noted that the anti-crisis strategy should be formed simultaneously with the primary business strategy. You need to be prepared in advance for possible crisis manifestations. Including the global economic crisis. Then, in the event of an emergency, firstly, it remains for you to introduce plan “C” for the company and, secondly, to make further adjustments to it by the actual situation in your market. It is essential to do it quickly. “Procrastination is like death.” Thirdly, it is also necessary to focus on bringing current expenditures in line with current incomes.