strategy-3-parts

Strategy is how to win! Win what? a battle or the war?

How to win a battle, in business markets, is well written about and is for most clear. Less clear and less dealt with, however, is the latter, the question of how to win the war.

This short post aims to elucidate it placing it in the context of the business strategy which we think of as having not one, not two but three fundamental components which are explained below.

First, mission and vision constitute fundamental prerequisites that act like a beacon in the strategy formation with many successful companies purposely striving to keep its light visible through the entire life of their companies.

Second, strategy should have a part that helps a business compete in the specific market arenas that it finds itself in; strategy must provide guidance for it to win so as to survive and prosper. But even when winning, a business cannot remain stationary in the same one market as every market has a natural end as conceptualized by the product life cycle, and besides, limiting itself to one market will not serve the aspirations of growth and profitability for most companies.

So, third, needed is an element of motion; the company must move on, and for purpose and efficiency, move on in such a way as to come closer or reach its ultimate goal, its vision. This is a stage of motion where things are anticipated but have not taken a final form and therefore abundant with risks. So, it must be well thought and prepared as it aims to produce sometimes innovations, other times new creative capabilities or set new game rules or objectives, and if possible, ahead of competitors.

These are 3 important concepts that when cleverly pre-thought both short-term and long-term can form the pylon components of the strategy of the business:

a)      The Vision/Mission (the ultimate goal of winning the war)

b)      How to win in markets – competing, winning battles and market arenas

c)      The Creative Motion – generating new capabilities or innovations that will enable the firm to enter new markets which will gradually propel the firm toward vision and mission.

The diagram below represents these three stages of strategy as a series of states or competing arenas (rectangles) and creative motions (arrows) advancing to realize the Vision and Mission:

strategy-3-parts

it is important to consider how all three concepts co-exist at any given time. One involves the route, the path to a target and resembles a journey (B-denoted stages), and the other involves competition that is confined in space and time as in the play of a game (A-denoted stages). Revenues from stage A sustain work of stage B which in turn creates the necessary new tools for the company to play in a series of markets, each appropriately chosen in alignment with its vision/mission (stage C).

Concluding, what this post has tried to do is not to say that Competing is not important, but that Competing alone without the Creative Motion, which seems to receive less attention in many businesses, will not help the company reach to the Vision/Mission which is why a company exists in the first place.

For a sustainable winning strategy all three components must be rightly chosen; The vision/mission must be appropriate to the company’s intent and character; the company must maintain an engine of creating new capabilities well before the need becomes apparent; and with these new competencies, the company must be made capable of going to new markets to win.

 

Panikos Sardos

 

About the author: Panikos Sardos is the Managing Director of P&E Sardos Business Solutions Int., a management consulting firm that offers advisory services, coaching and training. You are welcome to communicate with us by email: psardos@sardossolutions.com or telephone: +357 99640912, +357 24400884, or visit us at www.sardossolutions.com