Bla Bla ? Booz Article: Strategy Development against Industry Forces

To create a robust business strategy, organizations all must perform strategy development that starts with a agreed upon understanding of its business positioning and identified strategic barriers to growth. The next steps include defining what the future state vision of the company is and then going into the details of strategically planning how to get to that state. In order to understand your strategic challenges, you must begin with a complete, end-to-end understanding of your situation. It is also important to realize that there is more to strategy than just winning. Strategy is about value innovation, strategy is about focus, and strategy is about speed .

Business strategy includes the topics of corporate strategy, marketing strategy, sales strategy, as well other areas of strategic thinking. Sales strategy includes channel strategy, distribution strategy, and business development. Marketing strategy includes advertising strategy, go-to-market strategy, and SEO strategy. Business strategy development is many times conducted during a yearly strategic planning environment, usually conducted in a 2-3 day remote location with executives and key personnel, both inside and external to the organization. Within growth strategy, we include both organic growth and inorganic growth, namely M&A. Marketing strategy and sales strategy are many times coupled together, but are distinct in actuality.

The strategic thinking of modern business organizations has been shaped by military strategists since 400BC when Sun Tzu wrote the Art of War. Sun Tzu preached to know and attack the enemys strategy. In Sun Tzus Art of War, he wrote about several core factors in military strategy and each of these factors relates to a popular concept of business strategy. Sun Tzus teachings about the variable of land, in todays business landscape, translates to markets, industry structures, market positions, and Porters Five Forces. Sun Tzu hinted at indirect business strategies when he said winning without fighting is the highest of skill on the battlefield.

Today, there are two primary schools of thought around strategic management. Henry Mintberg also advocates a transformation of business practices, where management recognizes the need and has the ability to manage organizational business operations transformation. Henry Mintzberg opts for an organization, bottom-ups process to drive business strategy development that hinges upon organizational configuration. In organizational configuration, the organization takes on behaviors based on adaptation to business surroundings.

Strategy development has evolved through 5 key stages since the early 1900s. A lot of growth strategy is also hinged on ideas in the 1970s, where the focus was around thinking strategically to beat competition and the business frameworks of alternative strategies, portfolio analysis, and the BCG Growth Share Matrix emerged. In the current day, the strategic development theme is on integrating strategic planning and execution with a stress on the key concepts of core competencies, strategy planning and execution, and balance scorecard analysis. Strategy development started with a focus on financial planning in the 1950s, moving to long-term business planning in the 1960s, to strategic planning in the 1970s and ultimately to a focus on strategic management in the present day. Shifts in strategic mindset represent a changing landscape, new business leaders, and emergence of disruptive technologies and trends.

Bower believes that the strategic planning and budgeting process is at the heart of the strategy development process. Organizational context is made up of governance and the org structure, definition of performance metrics and rewards, and the managers beliefs and cognitive mindset. In the Resource Allocation framework, when market context is discussed, we are evaluating the demands of the largest customers, as well as technology development. Bower defines strategic intent as the perceived and communicated corporate strategy. Bowers school of thought is called the Resource Allocation Process RAP framework. Resource allocation based strategy planning and budgeting is a bottoms up driven way to finding and selection of business initiatives. Capital market context is also analyzed, which is defined as demands and influences of sources of capital, such as PE firms.

Source: http://blasite.com/2011/09/booz-article-strategy-development-against-industry-forces/

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