I had an interesting discussion about business strategy yesterday, which brought up this short excerpt, one of my favorites, from Hurdle: the Book on Business Planning, which is free online.
Define Overall Strategy
Strategy is focus. Across the entire business, over the whole range of possibilities involving different products and services, different target customers, different kinds of financing, different levels of growth, what are your choices? What are your priorities?
In 30 years of working with businesses of all sizes, I’ve come across several of what I would call general principles of strategy. These don’t necessarily apply in the academic world, or for larger corporate enterprises, but they do apply to small and medium businesses everywhere:
- Strategy is Focus. The more priorities in a plan, the less chance of successful implementation.
- Strategy Needs to be Consistently Applied Over a Long Term to Work. Better to have a mediocre long-term strategy consistently applied for years than a series of brilliant but contradictory strategies that never last long enough to matter.
- Strategy Needs to be Tailored. There are no standard strategies. Every company is different. A given strategy must always be tailored for a specific company.
- Strategy Needs to be Realistic. You have to deal with your company as it is at this point in time, understanding what choices you really have, what knobs you can actually turn.
- The Best Strategies are Market Driven. When possible, it’s not “how to sell what we have,” but rather, “how to make what people want or need what we offer.”
- Good Strategies Understand Displacement. Displacement in business refers to the undeniable fact that everything you try to do rules out many other things that you therefore can’t do. You have to choose carefully, because one project displaces many others.