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Opinion: Five keys to business strategy

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The increased frequency of disruption and growing uncertainty in many industries today calls for more strategic thinking by business owners and leaders.

Albert Einstein had a saying that’s as sage now as it was when he coined it: “The significant problems we face cannot be solved at the same level of thinking we were at when we created them.” That’s worth pondering.

Reaching the next level, whatever that is for your organization, will likely demand thinking and strategizing by your leaders on new levels. A clearly articulated, solid business strategy that will serve your organization for the next several years is a wise place to start.

You might be wondering, what is a business strategy? Is it the same as a marketing strategy, or a sales strategy? Or you’re thinking, why exactly should I worry about having a business strategy if my company is surviving?

A business strategy clarifies how your company will compete given the environment. That’s different than marketing or sales strategies. Marketing strategy focuses on how your business will position its product and services in the market, while sales strategy emphasizes how your company will maximize sales and profitably.

If your company has been successful so far, you still need a business strategy for the future. There are many benefits.

First, it makes you identify the opportunities you will pursue, and the ones you won’t. Both are critical determinants of optimal success. A business strategy gives you laser focus for marketing and sales strategies. It strengthens your competitiveness, defends against competitor tactics and helps you avoid what won’t pay off – which then frees up resources to fully capture what will.

In an age when just surviving is considered a badge of honor, a business strategy will help you survive what’s ahead. Creating a successful business strategy, though, requires concerted effort. For instance, a few weeks ago, an international client brought four C-level executives to Los Angeles to develop a business strategy that would double sales during the next five years. The energy related company operates on three hemispheres and is in a complex, hyper-competitive niche. I facilitated the three-day session which focused on five main aspects of the business, involving nearly 50 questions. Here’s a brief overview:

No. 1. Value proposition. What will we sell? Where? How will we differentiate our products/services from competitors?

No. 2. Operations. How will our people and products be deployed in order to retain competitive advantages? What will our infrastructure and facility requirements be? How will we align our business strategy with our operations?

No. 3. Competition. Who is our competition and what have they been up to in the last year or so? Where are they vulnerable? What are their strengths? How will we take market share and sales? How will we defend against their tactics?

No. 4. Marketing and sales. Which markets represent our greatest opportunities? Is our sales force large enough? How will we manage our sales opportunities and achieve higher closing ratios?

No. 5. Customer relations. Is there any part of our customer satisfaction and retention efforts that need improvement? How will we assure customer loyalty going forward?

These questions are thought-starters for a 2012 business strategy.

As I wrote this article, Steve Jobs came immediately to mind. He will be remembered by many as the brilliant inventor and inspiring leader at Apple. In my mind’s eye, however, it isn’t the brilliance of Jobs’ inventions as much as it is the acuity and execution of the company’s business strategy that impresses me most. Time and again, Apple’s strategy and execution has resulted in impressive market share, sales and profit gains.

Any company can, and should, take the necessary steps to craft a business strategy. Perhaps, there’s nothing as dangerous in today’s climate as trying to run an organization of any size in any industry without one.

Mark Holmes helps companies increase sales, service and employee performance. He has advised large and small businesses nationwide, presented more than 2,000seminars and keynotes and written three books, including “Wooing Customers Back.” Holmes can be reached at mark@salesonomics.com.[[In-content Ad]]

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