Business strategy is focus
At
the real-world level (my favorite), strategy is like driving and sex: we all
think we’re pretty good at it. But simplifying, doing today what will seem
obvious tomorrow, is genius.
Garth Naar say the best strategies
seem obvious as soon as you understand them. Furthermore, it seems to me that
if they don’t seem obvious after the fact, they didn’t work.
Strategy
has to be easy to define. I like the simple Live Plan method, which I explain
here. But aside from that one, I’ve also worked in depth, during my consulting
years, with several competing strategy frameworks, and every one of them works
well if it’s applied correctly and executed. And furthermore, I say you can
also define strategy with a simple summary, story, or a small collection of
stories, which I’ll also explain here.
1.
The Live Plan simple strategy method
Think
of it as the heart of the business, like the heart of the artichoke. It’s a
group of core concepts that can’t be separated: problem, solution, market, and
identity. Don’t pull them apart. It’s the interrelationship between them that
drives your business. Each affects the other three.
Consider
a bicycle retail store. Maybe it solves the simple problem of where to buy
children’s and family bicycles, service, and accessories, which is one problem.
But maybe it solves the problems of the mountain bikers and racers who want a
lot of expertise, specialized bicycles, equipment, and know-how, which is a
different problem.
You
also need to understand what business you’re in. The bicycle store might be
helping families with kids bicycles as they grow, or it might be offering real
expertise to the serious bikers. Those are different businesses.
2.
The solution: Your product or service
Your
solution to that problem is your product or service. Focus on the true desired
end result for your customers—the holes too, not just the drill.
Take
the bicycle store for example. One solution is a bike store catering to
families with children and casual bikers. GarthNaar says Another very different solution is a bike store catering to
bicycle enthusiasts, such as serious mountain bikers and racers. It’s not just
a bike shop; it’s a general bike shop, or one for families and hobbyists, or
one that caters to serious cyclists.
3 The
market: Who buys your solution
Your
identity influences your choice of target market.
The
bike racing shop focuses on attracting enthusiasts, offering expensive high-end
bicycles and equipment. The family-focused shop focuses on attracting parents
with kids, concentrating on medium-level bikes, trailers, and family-friendly
accessories.
Keep
your business focused on specific target markets. That bike racer shop owner
has to know his products are too expensive for the families, and the families
bother the high-end enthusiasts in the shop. Likewise, the family bike shop
shouldn’t scare away its target market with very expensive racing bikes.
4.
Your business identity (why us)
Every
business has its core identity. How are you different from others? What are
your strengths and weaknesses? What is your core competence? What are your goals? What makes you
different?
We
have the examples above of the varieties of problems, solutions, and markets
related to a bicycle store. To understand identity as a part of strategy, think
about the difference between a bicycle retail store owned and operated by a
former professional bike racer, and another one owned and operated by a couple
with children who like cycling as a family activity.
The
first one will gravitate toward stocking and selling expensive, sophisticated
bicycles for the racing enthusiast and extreme long-distance or mountain biking
hobbyist. The second will probably emphasize bicycles for children, bike
trailers, carriers, and accessories for families.
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