In the simplest terms, a business strategy can be defined as a documented plan about how an organization is setting out to achieve its major goals. Steven Rindner mentions that the business strategy of a firm typically features a host of important principles that underlines how a company can effectively attain its major goals. These goals can involve the steps needed to deal with the competitors, as well as how to meet the needs and expectations of customers. The business strategy of a firm is ideally developed by keeping its long term growth and sustainability in mind.
A well-defined and researched business strategy would provide an insight on how a business is performing internally, while highlighting the steps to undertake to improve its operations. Steven Rindner says that a business strategy would create a vision and direction for the whole company, on the basis of which it shall progress. It is vital for all the people associated with a company to have a clear idea about the business goals and the direction to be followed to reach them. A business strategy is needed to provide this vision, as well as to prevent individuals from losing sight of their company’s key goals and objectives.
Here are some of the advantages of formulating a business strategy, as per Steven Rindner:
- It provides all the business stakeholders with the clarity, focus, and direction needed by them. With a business strategy, it becomes clear where an organization currently, where it is going, as well as what do people need to do to help it reach its goals. As managers align the business operations as per the principles of the business strategy, a company would effectively move towards progress.
- Business strategy helps the managers and the company employees to allocate their time, effort, and resources strategically, and keep track of the most important aspect of the business.
- Subsequent to having a proper business strategy, managers can review assumptions, track progress, and identify any new developments that they can adjust in it. As no one can fully predict the implications of carrying out the various steps involved in a business strategy, it is crucial that people managers are always ready to make certain tweaks into it, as per the requirements of the prevailing situation.
- Developing a business strategy shall give the employees the much-needed drive and impetus to perform their best and take the business to where they want it to be.
To develop a business strategy, one firstly needed to have a good understanding of the current condition of the company. To acquire this understanding, one needs to look at the overall business of a company, including the important internal drivers like customer satisfaction, staff turnover, financial performance, conversion rates, as well as sales and marketing trends. They must also try and consider the vital strengths, weaknesses, opportunities and threats associated with the business, to identify the steps to take to help the company to move forward.