The Basics of Business Strategy

Due to the emergence of COVID-19, many companies have put their long-term planning on hold. It’s no longer feasible to start planning for the future right now, and the disruption caused by the pandemic has only added to the urgency. However, even amidst the disruption, we still need to consider what the future will look like.

Before starting planning for the future, it’s important that we first identify the areas of concern that need to be resolved. Then, we need to come up with a strategy that will allow all of our departments to come together seamlessly.

There are various types of business strategies that can be considered when it comes to planning for the future. These include a corporate strategy, a functional strategy, and a business unit strategy. Having all of these together will allow you to confidently say that you have a well-defined long-term vision.

Overarching Corporate Strategy

A good corporate strategy is a framework that aims to provide a long-term competitive advantage to a company while delivering value to its stakeholders. It can be done in various forms, but the most important question that needs to be answered is: What should my company be doing?

A corporate strategy can be easily conceptualized as a portfolio composed of various smaller companies that come together to deliver a certain amount of value to the whole company. Like managing a portfolio, this type of framework involves making decisions based on the balance between reward and risk. Having a well-defined corporate strategy can help ensure that your company is more than just a collection of parts.

A successful corporate strategy is a system of interdependent parts that helps executives make critical decisions related to the company's operations and goals. This type of framework is designed to guide the decisions that the corporation makes in order to maximize its value.

Before starting a corporate strategy, it's important that the executive team and the other members of the organization are involved in the day-to-day operations of the company. This type of framework can be done in various ways, depending on the needs of the company.

Getting More Specific

A business unit strategy is similar to a corporate strategy in that it focuses on identifying the best ways to deploy the company's capital. While a corporate strategy is focused on investing in the various parts of the company, a business unit strategy is more about planning and budgeting for the various investments that will be made.

Like a house, the goals and strategies of a corporate strategy are the roof over all else. The various business units that are part of the corporate strategy also serve as the pillars that support the roof. The various foundations of a successful corporate strategy are also the things that will support the roof. These include the various enablers that will help the company deliver value. Some of these include establishing a strong and supportive culture, attracting and retaining quality talent, and building a resource chain.

Establishing a Gameplan

A functional strategy is similar to a corporate strategy in that it focuses on developing a set of actions that will support the various goals and strategies of the company. This type of framework is also designed to mimic the multiple functions of a corporation. After breaking the objectives into lines of action, the functional strategy is then able to define the multiple forms of support that will be needed by the organization.

Unlike other strategies, a functional strategy is focused on moving past the vague goals and focusing on the important factors that will help the company stand out from the competition.

The changes brought about by the rise of e-commerce and subscription models have drastically changed the way operational strategies are conducted. Due to the various changes brought about by the rise of e-commerce and subscription models, the marketing industry is also undergoing major changes. These include the increasing importance of customer-centricity and brand marketing.

One of the most critical factors that businesses consider when it comes to technology is the availability of the necessary resources to support their operations. This is because remote work has become so common, and the companies that employ it need to have the necessary skills and resources to keep their operations running.

Although the need for office space has become more optional, it's still important to consider the exact amount of space that you need to support your operations. Where does the money go when it comes to improving team building and coordinating activities?

Due to the complexity of the situation caused by the pandemic, it's important that companies continuously update their functional strategies to keep up with the changes brought about by the changes.