The 5 steps to an effective business strategy

A business strategy consists of implementing a set of actions in order to achieve the objectives set while taking into account the internal and external environment.

It is through it that the company defines its vision. It allows him to establish objectives and a mission and to implement the means to achieve them. This, by maximizing the opportunities and minimizing the risks.

A solid business strategy can be built by following the 5 steps which we present below.

It is also possible to use the services of strategy consulting firms to accompany you on your journey.

Step 1: Analyze the environment

Scanning the environment is one of the first steps in setting up a effective business strategy. The goal is to identify the company’s internal strengths and weaknesses, external opportunities and threats, as well as market trends and customer expectations.

To do this, you can use the SWOT Matrix (strategic analysis tool), monitor market trends, conduct market research, analyze the competition, etc.

You can tackle the task alone or contact a strategy and management consulting firm like here to guide and support you.

Step 2: Definition of objectives

You must define clear and measurable objectives for the company. The value of objectives is that they allow you to establish a clear direction to follow. They push you to focus on the results to be achieved, without dispersing yourself.

These objectives are of order financial, commercial and operational.

They should be specific, measurable, achievable, achievable and time-bound (SMART).

Step 3: Develop the strategy

5 Steps to an Effective Business Strategy

Once the goals are clearly defined, it’s time to develop a strategy to achieve those goals. The company will determine actions to be implemented based on the expected results.

Tools have been developed in the field of strategy to optimize this step. There is for example the Boston Consulting Group Matrix (BCG) or that of McKinsey. Both make it possible to determine the actions to be implemented according to the company’s activities and products and their market share.

Step 4: Set up an action plan

This is a document that describes in a clear and detailed manner the steps to follow in order to achieve the set objectives. This action plan must include the tasks to be performed, the deadlines to be met, the resources required, the responsibilities and the performance indicators.

A monitoring and control system must be put in place to ensure the smooth running of the plan.

Step 5: follow-up and adjustment

When the strategy is in place and the action plan implemented, the company must closely monitor the results and adapt if necessary. Performance indicators such as sales, profits or customer satisfaction rates are there to tell you if the objectives are achieved or not.

If necessary, you will have to make adjustments, changing your strategy a bit.

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