8 Steps For A Strong Business Strategy
Although we’re known for brand strategy, when working with clients, we often begin by asking to review and (if necessary) update their business plan. Why? Because a sound business strategy is vital to creating a viable, thriving business. Your business strategy is the plan for how your company will make money, and brand strategy is your business strategy from your customer’s perspective. So you want to have a solid foundation in place to make sure your business is primed for growth.
The case For A Sound Business Plan
A solid business strategy – or plan, or model; the terms are pretty interchangeable – helps avoid misuse of resources. It helps you focus on accomplishing core deliverables and objectives. Having a plan in place can help you right-price your offerings, and can help you avoid getting blindsided by your competition. It can help you prioritize so you don’t get sidetracked with distraction projects and fall victim to over-promising and overhype. The landscape has many examples of failed businesses that didn’t have a solid business strategy in place and relied on brand and marketing to do the heavy lifting. See: Pets.com, webvan.com, and the like. Please avoid this fate.
We work with our clients to first update their business plan, so they have the best chances for success. Once this is in place, we turn our efforts to branding. It’s simple: we don’t want to spend our time and our clients’ money building a brand that will never reach profitability because of an unrealistic business model.
How to Evaluate Your Business
We begin by taking our clients through our business strategy framework, which ensures a solid foundation. For smaller companies looking to DIY strategy, you can do this exercise yourself:
- Begin with a solid SWOT analysis for your business: objectively assess your Strengths, Weaknesses, Opportunities and Threats.
- Zero in on your business competencies and clarify the problems you solve. Focus on the core problem your business addresses.
- Highlight your target market, their needs, and how your business fulfills these needs. Draw the direct connection between customer needs and your solution.
- Decide on the resources you need to deliver customer solutions.
- Determine pricing for your services. Make sure your fixed and variable costs are covered, as well as your overhead and that you still make a profit.
- Single out the best partners and suppliers for supply chain optimization.
- Know your competitors and what they are delivering (and importantly: what they are not); zero in on the opportunities for differentiation.
- Explore external factors that can impact your business, e.g., political / economical / socio-cultural / technological / legal / environmental.
Analyzing these areas will help you build a solid business strategy, which will point out potential pitfalls to address, and help position your company for growth. This is a key step before turning to brand strategy. Importantly, this work can also highlight opportunities for differentiation and new revenue streams.
For more guidance on how to structure your business strategy, we recommend The Business Model by Alexander Chernev, a short but dense read on business strategy. If you’d like to reach out to us directly, we’re also available for business strategy consultations.