Whenever you set off across new territory you’ll want to consult a map, otherwise you’ll get lost.

Stepping forward into the unknown (also known as ‘the future’) is what companies do every day.

And what do they need to make sure they don’t get lost?

A strategy, of course, which some may also call a roadmap.

Whether you’re looking to set new business priorities, outline plans for growth, determine a product roadmap or plan your investment decisions, you’ll need a strategy. Coming to the realisation that your organisation needs one is easy.

Actually creating a strategy is a little trickier.

Here are 6 simple steps to help you deliver an effective business strategy:

  1. Understanding the Starting Point: Assess your current position by reviewing past performances and conducting SWOT and PESTLE analyses.
  2. Crafting Vision and Mission Statements: Develop forward-looking vision and mission statements to define your business’s purpose, values, and short-term objectives.
  3. Setting Strategic Objectives: Formulate high-level, SMART objectives that reflect your company’s priorities and incorporate insights from your initial analyses.
  4. Developing Tactical Plans: Translate strategic objectives into detailed short-term plans, assigning specific actions to different parts of your organization.
  5. Implementing Performance Management: Continuously monitor and adjust your strategy to stay aligned with your goals, using KPIs and regular reviews to measure progress.
  6. Engagement and Flexibility: Involve the right people from the start and remain flexible to adapt your strategy as necessary based on performance management insights.

1. Gather the Facts

To know where you’re heading, you have to know where you are right now. So before you start looking ahead, you should review the past performance, or the current situation.

Look at each area of the business and determine what worked well, what could have been better and what opportunities lie ahead.

There are many tools and techniques available to help with this process, such as SWOT (Strength, Weakness, Opportunities and Threats) analysis.

You should look internally at your strengths and weaknesses. And for the opportunities and threats you should look at external factors. A great framework for looking at external factors is PESTLE (Political, Economic, Social, Technological, Legal and Environmental). So, for your big idea or plan you would ask: what threats and opportunities could arise under each category?

The most important part of this process is involving the right people to make sure you’re collecting the most relevant information.

2. Develop a Vision Statement

This statement should describe the future direction of the business and its aims in the medium to long term.

It’s about describing the organisation’s purpose and values. Business gurus have debated long and hard about what comes first – the vision, or the mission statement (see step 3). But, in practice, you could develop both at the same time.

3. Develop a Mission Statement

Like the vision statement, this defines the organisation’s purpose, but it also outlines its primary objectives.

This focuses on what needs done in the short term to realise the long term vision. So, for the vision statement, you may want to answer the question: “Where do we want to be in 5 years?”.

For the mission statement, you’ll want to ask the questions:

  • What do we do?
  • How do we do it?
  • Whom do we do it for?
  • What value do we bring?

4. Identify Strategic Objectives

At this stage, the aim is to develop a set of high-level objectives for all areas of the business. They need to highlight the priorities and inform the plans that will ensure delivery of the company’s vision and mission.

By taking a look back at your review in step one, in particular the SWOT and PESTLE analysis, you can incorporate any identified strengths and weaknesses into your objectives.

Crucially, your objectives must be SMART (Specific, Measurable, Achievable, Realistic and Time-related).

Your objectives must also include factors such as KPI’s, resource allocation and budget requirements.

5. Tactical Plans

Now is the time to put some meat on the bones of your strategy by translating the strategic objectives into more detailed short-term plans. These plans will contain actions for departments and functions in your organisation.

You may even want to include suppliers.

You’re now focusing on measurable results and communicating to stakeholders what they need to do and when. You can even think of these tactical plans as short sprints to execute the strategy in practice.

6. Performance Management

All the planning and hard work may have been done, but it’s vital to continually review all objectives and action plans to make sure you’re still on track to achieve that overall goal.

Managing and monitoring a whole strategy is a complex task, which is why many directors, managers and business leaders are looking to alternative methods of handling strategies.

Creating, managing and reviewing a strategy requires you to capture the relevant information, break down large chunks of information, plan, prioritise, capture the relevant information and have a clear strategic vision.

Business Strategy Example: Green Innovate Technologies

Let’s have a look at a fictive company example to help you wrap your head around this concept more easily.

Green Innovate Technologies, a burgeoning startup, is poised to revolutionize the renewable energy sector with its cutting-edge solar panel designs.

Founded in 2023, the company’s mission is to democratize access to sustainable energy solutions across residential and commercial sectors, reducing the global carbon footprint.

Here’s a look at how Green Innovate Technologies approaches its business strategy to navigate the competitive landscape and achieve its ambitious goals.

1. Gathering the Facts:

Green Innovate begins by evaluating the renewable energy landscape, identifying strengths such as innovative design and weaknesses like initial production costs. Using SWOT and PESTLE analyses, they recognize opportunities in emerging markets and threats from established competitors. They engage a diverse team from R&D, marketing, and finance to ensure a comprehensive view.

2. Vision Statement:

“To be the leading provider of innovative and accessible renewable energy solutions by 2030, making sustainable living a standard for communities worldwide.”

3. Mission Statement:

Green Innovate aims to transform the energy industry by:

  • Designing high-efficiency, cost-effective solar panels.
  • Making renewable energy accessible to underserved markets.
  • Advocating for policy changes to support green technology adoption.
  • Delivering unparalleled value and service to our customers.

4. Identifying Strategic Objectives:

Strategic objectives include achieving a 25% market share in the residential sector by 2025, reducing production costs by 15% within three years, and establishing partnerships with at least five major construction firms to incorporate Green Innovate’s solar solutions in new developments.

5. Developing Tactical Plans:

The company outlines detailed actions, such as launching a targeted marketing campaign focused on the benefits of solar energy, investing in technology to streamline production, and negotiating with suppliers for volume discounts.

Departments are assigned specific roles, with milestones set for every quarter.

6. Implementing Performance Management:

Green Innovate adopts a balanced scorecard approach to monitor progress, setting KPIs for sales growth, cost reduction, customer satisfaction, and innovation. Regular strategy reviews are conducted to adjust tactics in response to market feedback and technological advancements.

Through this strategic approach, Green Innovate Technologies is not just dreaming of a greener future—they are laying down the actionable steps to make it a reality.

This example illustrates the importance of a well-structured business strategy in guiding a company through the complexities of market entry and growth, ensuring that every action contributes to the overarching mission and vision.

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