Business Strategy

A business strategy is the means by which it sets out to achieve its desired ends (objectives). It can simply be described as a long-term business planning. Typically a business strategy will cover a period of about 3-5 years (sometimes even longer).

At the root of every failed strategy is a set of assumptions about the future that eventually proved false. We assumed housing prices would never fall simultaneously across the country. We assumed asset diversification would eliminate risk. We assumed the migration to digital media would be slow and orderly. We assumed customers would not accept fewer features in exchange for a lower price.

The way in which you charge corporate overhead costs can also stimulate creative tension. You insist on full allocation of overhead-everything from legal to marketing expenses to the parts of the business that use them.

Although you want your employees to achieve their personal best, they must also work together toward shared goals. To create the high levels of commitment that requires, leaders must build an organization that has the following four attributes:

★ Pride in purpose

★ Group identification

★ Trust

★ Fairness

► A) Reducing the cost base of the organization

► B) The lowest cost base of competing organizations

► C) Prices lower than competition.

► D) Lower quality products or services than competition.

B) The lowest cost base of competing organizations

► A) Impossible to achieve in practice

► B) A strategy, which seeks to provide high-perceived value justifying a substantial price premium usually to a selected market segment

► C) The period of time when an organization is changing its strategy

► D) A strategy, which seeks simultaneously to achieve differentiation and a price lower than that of competitors

D) A strategy, which seeks simultaneously to achieve differentiation and a price lower than that of competitors

► A) Part of an organization for which there is a distinct external market for goods or services.

► B) A subsidiary responsible for a significant volume of business

► C) The corporate centre

► D) Parts of an organization targeting the same customers through different channels and facing different competitors

A) Part of an organization for which there is a distinct external market for goods or services.

The most common way of motivating people to innovate is to set stretch goals, sometimes called challenge goals or big, hairy, audacious goals. Conducting business as usual or making incremental improvements is not enough. The only way to meet aggressive targets is to do something completely different.

► A) Higher quality products or services than competitors

► B) Innovation of products or services greater than competition

► C) Providing different products or services, which draw upon competences or resources, which competitors do not have.

► D) The provision of products or services that offer benefits different from those of competitors and that are widely valued by buyers.

D) The provision of products or services that offer benefits different from those of competitors and that are widely valued by buyers

Business agility refers to a company's ability to react quickly to changes in the external environment or marketplace so they can avoid being damaged by potential elements that can be threats to their business model and respond quickly as there are new opportunities as a result of shifts and changes in things like demographics, customer behavior etc.

Developing and implementing a business strategy in a non-profit or not for profit organizations is not significantly different in terms of process from implementing a business strategy in a for profit company. The details are different but best practices are still the same. Because of the nature of not-for-profits much of their planning and strategy documents are publicly available online, so we will not go into great detail about how, in this case, the girl scouts, created a new business strategy and deployed through the organization.

Example:

Many years ago, the company, was working on developing a new kind of adhesive / glue in its laboratory. They were trying to develop something to be used in their famous line of scotch tape products. They came up with a glue that simply did not conform to the specifications and functions they required but had other characteristics. It is said that for a number of years, despite efforts by the research scientist involved, nobody at company was particularly interested in the use of the product or could even see how such a research "failure" could be transformed into a profitable product.

Here is a menu of techniques that can generate creative tension and spur innovation. In this instance, unlike when defining a primary customer or ranking your responsibilities, you need not choose just one, choose whichever and however many are right for your company. In fact, the more innovation you desire, the more techniques you should consider.

★ Assigning stretch goals.

★ Ranking according to performance.

★ Setting spans of accountability that are greater than spans of control.

★ Allocating costs.

★ Creating cross-unit teams and matrix accountability.