You’ve probably heard the quote: “If you don’t know where you’re going, you’ll end up someplace else.”
Not just an inspirational saying on calendars and fridge magnets, it also applies to your company. If you don’t have a well-defined corporate strategy in place, you’re unfortunately wandering aimlessly.
In simple terms, a business strategy is a documented plan on how your organisation will achieve its goals. Without it, even the very best or most innovative product or service won’t be enough to propel you forward.
All businesses need to have a written strategy that’s powerful enough to pull the company toward growth and security.
Unlike the office Christmas tree, it must be more than a project or a document that’s dragged out once a year and forgotten about until next year. And it must be shared with employees instead of being kept a mystery or something vaguely referred to around the water cooler.
Below are just a few reasons why strategy plays such an important part in a company’s success…
Clarity, direction and focus – Every organisation and its staff should understand their purpose, destination and how they will get there. A business strategy creates a vision and direction for your company. It provides you with a set of actions and ensures that everyone is working towards the same goal. It should be understood by every employee and used to guide all decision-making within your company.
Strengths and weaknesses – Strategy allows you to develop a clear understanding of your capabilities, identify weaknesses and develop ways to overcome obstacles. It offers a guide on how your business is performing internally as well as how you are performing against your competition. Strategy creates a higher level of awareness about what it takes to make your company more successful.
Resource allocation – What markets and clients will you serve? What types of products or services will you offer? No matter the size or type of your company, resources are always finite. Strategy helps answer these questions and ensure resources are put towards the most promising opportunities that will reap the biggest returns.
Look towards the future – Strategy helps you engineer your organisation’s future, grow your business profitably and identify upcoming trends and opportunities. It can explore changes in the market, such as technological, consumer, political and social changes, and help you develop tactics to respond to them and stay relevant. It defines the benchmarks for achieving success.
Too often, strategy development is something that’s started but never finished – or worse – ignored altogether. “But we have far better things to do right now than to take a few days away from the business!”, you might say.
But can you really afford not to put the time and effort into developing a strategy?
Strategy guides decision-making, defines direction, sets goals, channels resources, helps build competitive advantage and communicates your values to your staff. For all these reasons and more, a strategic plan is more than worth the time it takes to develop it.