Know What Is A Business Strategy & How To Create One
Let me ask you some questions.
Are you wondering whether you need a business strategy or not?
But what is even a business strategy?
How do I create one?
There's a lot of buzz going in the business world and people get scared when they hear fancy words like this.
But don't worry.
In this guide, I'm going to tell
- What is a business strategy
- Do you need a business strategy(spoiler: yes)
- How to create and execute business strategy
Let's get started.
What is a business strategy?
Things an organization plans to do to achieve its goals.
That's it. Super simple.
Now as you get more specific the definition might expand.
But basically, you'll expand the definition under the initial definition only.
For example, if you want to succeed you need to differentiate yourself from competitors.
Not the definition might change to "A strategy which helps an organization achieve their goals by giving the business a guide to differentiating from competitors, manage resources better, setting priorities, measuring success, etc".
Just an extended version of the initial definition.
Let's move on to the next question.
You NEED a business strategy
There's no doubt about that.
You need a business strategy.
And there are many reasons.
Because a business strategy will
- Guide your entire organization towards achieving the same vision
- Give you clarity between different departments and avoid confusion
- Help you to act strategically when tough times arrive in the business
- Help you to develop a predictable business model, etc
To be honest I can write a 5,000-word blog post on just writing about the benefits of developing a business strategy.
Now, let's know how to create an effective business strategy.
Here we go.
Effective business strategy guide
Creating a business strategy is hard.
But if you follow the below instructions and points, it'll become relatively easy for you.
Clarity of vision & goals
Remember the definition?
It is a strategy designed to achieve predetermined goals of the business.
So the first step is to collaborate with founders and get clear on what is the vision of the company.
How it should look like in the future.
You should not give vague answers like "We want to expand internationally", "Have a good customer base".
Write down the exact numbers
Something like "We would like to have at least 100 active customers within 3 months of launching our product. By the end of 2 years, we would like to have nearly 2000 customers and most of our clients should come from word of mouth and content marketing. Because we don't have the budget for advertising".
This gives us clarity and helps us create a really solid business strategy.
Getting everyone on board
Now you might have strategized the vision with few people in the organization.
But the success of this strategy will depend on what well your whole organization collaboratively executes the strategy.
So you must educate all the employees, managers, and other people in your business about the vision.
This will motivate everyone which will result in a collaborative effort.
What you need to do
Initially, you had created a specific goal you want to achieve.
Now write down what you need to do to get there.
Make sure to make decisions based on facts, not relying much on emotions.
Because we have our own cognitive biases, so try to be as objective as possible.
Gathering resources
Now you've created the plan, informed everyone, it's time to execute. Right?
But without gathering resources, you might run into some troubles.
Like when you need urgent cash and you realize you didn't gather all the resources, it can cost you a lot.
So gather all the resources which are needed to execute the strategy.
Execute & test out assumptions
Now it's finally the time to execute the created business strategy.
Now you might've made a lot of assumptions while creating the strategy.
So expect that your assumptions might not become true.
As Mike Tyson famously said, "Everybody has a plan until they get punched in the face".
So if you expect to fail and fail, it's not going to put huge pressure on you.