What the well-respected Japanese management consultant, professor and Dean at UCLA, Kenichi Ohmae, went on to say, although it doesn’t just apply to business strategy, was, “Without competitors there would be no need for strategy, for the sole purpose of strategic planning is to enable the company to gain, as efficiently as possible, a sustainable edge over its competitors.”
And this really is the key, isn’t it?
You build your business strategy around your competitive advantage and update it as conditions change – conditions within your business, as well as the market, your competitors, regulatory changes, and so on. Illustrating this last point, how many multinationals expected to have to exit Russia when they were looking at their strategy plans last year?
But central to everything, to being successful in your business, is having an advantage over your competitors, and one that your customers can readily understand. It might be quality, service, features, model range, pricing or something else, but it has to be something you can easily describe and in which your customers can see value.
And, as in much of life, the principle of keeping it simple applies. Complexity leads to confusion and people will go elsewhere.
By keeping in close contact with your customers and suppliers and maintaining a culture of open communication in your business, you’ll be well positioned to understand where the opportunities for improvement lie and be able to maintain an advantage.
Just remember the magic questions, and use variations of them in your business-related conversations:
- What are we doing well?
- What should we be doing more of, or start doing?
- What are we doing badly?
- What should we do less of, or stop doing?
And the last question is just as important as the first three. As the American business guru Michael Porter said, “The essence of strategy is choosing what not to do.”
A further tip: if you don’t have at least one outsider on your board (or have an advisory board), consider seriously doing so: you’ll get enormous value from their experience and will see a great return on a modest investment. There is a rich pool of experienced, successful executives who would welcome being able to help you take your business to a new level.
Finally, in these very volatile times you’ll likely be having monthly board meetings – just be sure to include strategy review discussions in every one.
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I work with successful owner-led businesses to enhance their growth, profitability and business value.
If you’d like to have a conversation about your business objectives and concerns, book a free 30-minute call with me here. I’d be delighted to talk with you.
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You can also learn more from these related posts:
- The Magic of Small Changes for Big Profit Increases
- NEDs – a Cost-Effective Way to Add Significant Value to Your Business
- Defining Your Ideal Customer Boosts Profits
- “If you don’t have a competitive advantage, don’t compete.” – Jack Welch
- “Don’t wish it were easier, wish you were better.” – Jim Rohn
- “Focus On Your Strengths, Not Your Weaknesses.” – Gary Vaynerchuk
- “Just get rid of the crappy stuff and focus on the good stuff.” – Steve Jobs
- Business Risks – How to Encourage Effective Innovation in the New Working Environment
- Inflation – Reducing the Risks to Your Business with the 5 Cs
- Planning to De-Risk Your Business Against Future Threats
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