Should Organizations Follow a Simple Business Strategy or Focus on Shaping a Growth Strategy?

During the last decade, it has become very challenging to design the right business strategy that will be sustained through the years. A business strategy should be strong, flexible, and competitive. The business strategy along with the corporate strategy are very critical for any company that is dedicated to grow year by year and make strategic decisions to boost its competitive advantage. Basically, any corporate strategy or business strategy should be translated into a growth strategy. Executives need to understand that markets and industries are changing so fast and realize what drives those changes in order to adjust business strategy. The goal is to continue growing and becoming competitive even during disruption and turbulent times.

There are six critical elements that any corporate strategy or business strategy should take into account when designing it from scratch orre-shaping it. First of all, the business strategy design should come from the leadership side, the leaders should have the vision of how the strategy should be shaped or re-shaped. A vision for growth, sustainability, and agility are common when an organization creates a good, crisp, and clear business strategy, determined to succeed. In addition, when implementing a corporate strategy, culture plays a significant role. A supportive culture is needed to embrace the new strategy. Also, a good strategic marketing plan is of high priority during the planning stage. If there is no clear marketing plan, the business strategy will not work as expected. After that, an inspiring C-Suite management team is needed to support the implementation and the company’s culture, as referred above. During the implementation stage, efficient and effective business systems are also another vital element, needed. Lastly, an organization needs a great number of resources to put the new business strategy in practice.

A common mistake, leaders make is that they are determined to design a new growth strategy, by evaluating past performance and past strategy elements. Of course, we always need to consider past mistakes during the planning and execution phases of a business strategy. However, the growth strategy should be merely focused on re-inventing the way the organization will generate value and finding innovative ways to serve the customers. Most of the time, a growth strategy is concentrated to add new product or service offerings, or new features. Technology is the main drive to shape new growth strategies. Technological advancements are so fast and so many that growing the company’s offerings is almost mandatory in order to stay ahead of competition.

Growth is vital for a company’s survival. Around 66% of businesses are surviving only for their first 2 years of operation. Around half will survive for approximately five years and unfortunately just 33% of them will be surviving for a decade. As those numbers are surprisingly similar across multiple industries, they also underline growth strategy’s importance. For the last three years, experts are seeing more companies implementing concrete growth strategies; some of the actions they undertake are: going digital (i.e. investing in e-commerce), finding new ways to boost customer acquisition (usually new online channels), adding new locations, expanding product lines (based on discovering new needs) etc. Conducting market and industry research is essential when planning a growth strategy. Many companies have been designing growth strategies that have failed, only because they did not research the market and the industry enough. For instance, a new line expansion might not generate enough revenue and break-even the initial investment cost, because there is not a real customer need to cover or maybe because the customer is not “trained” to know how to satisfy such a need with this new product/service offering. Above all, organizations need careful planning and implementation when designing a corporate strategy, a business strategy, or a growth strategy. BizXL Solutions is offering specialized services on strategy design, aiming at addressing specific needs and priorities. Learn more at: https://www.bizxlsolutions.com/strategy-design/