Are You Sure You Have A Strategy?

Strategos: "the art of the general"
You need a strategy: an integrated overarching concept of how the business will achieve its objectives. If a business much have a single, unified strategy, then it must necessarily have parts.

What constitutes a Strategy? A strategy consist of an integrated set of choices - but it's not a catchall for every impt choice an executive faces.

Elements of Strategy: Arena's, Vehicles, Economic Logic, Staging & Differentiators.

Arena's: Where will we be active? What business will we be in? one needs to be very specific about product areas, customer/market segments, geographic areas and core technologies. Products or Services should be targeted to the specific parameters outlined in the chosen Arena
If the plan is to focus on multiple market or customer segments or different geographic areas, product categories e.t.c, the strategy must be outline the level of emphasis which will be placed on each segment.

Vehicles: Once we've outlined the Arena's we must decide how we get to them. How do we get there? What steps do we need to take in order to be competitive in our chosen Arena's. Joint Ventures, Acquisitions, Strategic Alliances or other initiatives? What vehicles will we use to grow/expand and drive towards our goals? how much do we know about each vehicle - or the parameters of the vehicle?

Differentiators: How do we expect to win, in the market place? Our strategy must highlight how we intend to effectively compete in our chosen arena's. What resources do we have available? Any proprietary technology which gives us a competitive advantage? what's our strategic positioning plan? How do we differentiate ourselves from competition? (Brand, Price Points, Customer Services, Quality of product - e.t.c). We must choose / decide how we intend to differentiate and then devise a plan of action to actively differentiate ourselves in our chose arenas.

Staging: We can't do everything at once, or at the same pace? Some initiatives must come first, followed by others. We must lay a strong foundation on which to build modules for the future. If we're looking at a broad arena, which segment do we target first and why? Do we have specific vehicles which compliment certain arena's better than others? If so, we should take that into consideration when planning/staging our strategic initiatives.

Decision about staging are driven by a number of factors - including availability of resources, (human and capital), Urgency is also a factor - perhaps we may have a strategic advantage in one arena, which is time sensitive. Credibility is also a key factor - does our reputation and experience provide certain advantages for us in specific segments or with the use of certain vehicles?

We need to keep things simple - it's often smarter to get some quick early wins and build momentum, rather than try to do too much at once.

Economic Logic: count your costs and model out your revenue / profit potential. Why do certain Arena's seem more attractive than others? What's the benefit of using certain vehicles to reach clearly defined Arena's? Are your Arena's sustainable? Will customers continue to pay high prices for your products/services, or will pricing pressures eat into your bottom line? What's the economic value of your offering, what's your value proposition? Does your "value" allow you to charge premium prices for your products? Is your economic logic rooted in your companies enduring capabilities? Can then enable you to deliver strong revenue and profit growth over an extended period of time? These are the key questions which one needs to address when reviewing this element of a strategic plan.


These 5 Strategic Elements are each critically important. They are important enough to warrant specific, intentional planning. It's clear that we cannot think about any one element in isolation - for each impacts the others and therefore each must be consistent with the others. Each element must support and align with the others.

These 5 elements form the foundational framework on which companies can build org structure, foundational policies, operations programs/processes and other important elements of building an organization.

Key Questions Which Test The Quality of Your Strategy
1. Does your strategy fit with what's going on in the environment?
2. Does your strategy exploit your key resources?
3. Will your envisioned differentiators be sustainable?
4. Are the elements of your strategy internally consistent?
5. Do you have enough resources to pursue this strategy?
6. Is your strategy implementable?

A good strategy is not static - it should be flexible, it should evolve, as your business evolves in response to changing market dynamics, new arena's or new competitive advantages - all of which present interesting opportunities or challenges.

Having a strong strategic framework doesn't mean one maintains a specific approach, one can have multiple options. Ideally, a strategy should have a specific time-span - based on a set of intentional, informed choices.