Starting a business without a plan or an effective strategy is a challenge.
As the old proverb says, “a vision without a plan is just a dream. A plan without a vision is just drudgery… but a vision with a plan can change the world.”
Poor business strategy will likely lead the company toward huge losses. Thus, making it difficult to run your business once again. Fortunately, there are certain elements for you to incorporate into your business plan.
An inappropriate corporate strategy framework will not only fail to yield positive business outcomes but may also incur a huge loss to the company. Before moving further, let us first try to understand what exactly business strategy is and what do they mean.
According to Charles Hofer and Dan Schendel, top scholars of the academy of management proclaimed strategy to be “the fundamental pattern of present and planned resource deployments and environmental interactions that indicates how the organization will achieve its objectives.”
Another definition by Kenneth Andrew, a different scholar said, “strategy is a pattern of decisions and plans which are directed at interacting with the external and internal environment and effectively and efficiently allocating capabilities to achieve organizational objectives.”
According to Kenneth, there are different typologies of strategies. One among which explains a typology of these existing typology that creates positive results for companies when they are compared with others. So much of these has been compared based on the experience Kenneth has as a senior management consultant at San Diego, California.
Kenneth mentions four different dimensions of a corporate strategy which include – analysis pro-activeness, defensiveness, and futurity. And as defined by Venkatraman, analysis strategy is defined as the tendency to seek for problems and their causes and generates strategic alternatives to solve the problems. As a business strategist, you need to analyze the strategy, find if there’s a problem, and develop the best solutions to solve the ongoing problem.
Such type of strategy acts like stimuli for companies to make better decisions. An analysis strategy can help companies develop new opportunities for employee development. It also offers innovative solutions for companies as problems keep rising.
Here’s how executives can start contributing to the development of workplaces.
- Extensive usage of the information system that could help in supporting decision making.
- Proper use of planning techniques.
- Emphasis more on effective coordination amongst different functional areas.
- Proper use of performance appraisals.
- Deployment of the control system and management information.
- Detailed analysis is done when undergoing an important decision-making process.
Whereas pro-activeness strategy is majorly used by executives to take a proactive approach while seeking better positions in the business domain. This strategy helps executives find new opportunities while responding to the ongoing challenges faced in external environments. To inculcate pro-activeness strategy, executives need to ensure their business strategist maintains and follows the below factors.
- The attempt of introducing new brands to the marketplace.
- Constant lookout for new opportunities.
- Find a strategic way to eliminate operations that are no longer profitable in the later stages of the life cycle.
- Seeking constantly for new businesses.
Defensiveness strategy is used when executives need to set expand organizational earning via commercial knowledge. To foster this approach, executives can contribute through the following factors.
- Usage of the cost control system to help monitor performance.
- Emphasis made on service or product quality by using the improvement teams.
- Regular modifications to service technology.
Futurity takes place when strategic decision-making becomes a two-way street – emphasis both on short-term and long-term effectiveness parallelly. Executives generally use this strategy when they need to make decisions to expand their growth opportunities. This happens when the company is in close proximity between success and failure. Here’s what you need to do to develop a futurity strategy.
- Regular analysis of the critical issues.
- Keeping a track of the general and significant trends.
- Core emphasis on basic research which can provide a competitive edge for the future.