Strategic Excellence
We have seen the most clear definition of strategy as follows:
"Strategy is the direction and scope of an organisation over the long-term which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfil stakeholder expectations."
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Where is the business trying to get to in the long-term (direction)
- Which markets should a business compete in; what kind of activities are involved in such markets? (markets; scope)
- How can the business perform better than the competition in those markets? (advantage)
- What resources (skills, assets, finance, relationships, technical competence, facilities) are required in order to be able to compete? (resources)
- What external, environmental factors affect the businesses' ability to compete? (environment)
- What are the values and expectations of those who have power in and around the business? (stakeholders)
The Strategy Development Process
As indicated in above figure, the Strategy development process consists of four phases.
Strategic Planning
Strategic planning is the part where a strategy starts. The business defines its vision and mission for a certain period, and with that the direction the business has to go. After that clear goals should be defined.
Strategic Analysis
Strategic Analysis is all about analysing the strength of the businesses' position and understanding the important external factors that may influence that position. The process of Strategic Analysis can be assisted by a number of tools, including a.o.:
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PEST(E) Analysis A technique for understanding the "environment" in which a business operates
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Scenario Planning A technique that builds various plausible views of possible futures for a business
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Five Forces Analysis A technique for identifying the forces which affect the level of competition in an industry
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Market Segmentation A technique which seeks to identify similarities and differences between groups of customers or users
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Directional Policy Matrix A technique which summarises the competitive strength of a businesses operations in specific markets
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Competitor Analysis A wide range of techniques and analysis that seeks to summarise a businesses' overall competitive position
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Critical Success Factor Analysis A technique to identify those areas in which a business must outperform the competition in order to succeed
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SWOT Analysis A technique for summarising the key issues, arising from an assessment of a businesses "internal" position and "external" environmental influences.
Strategic Choice
This process involves understanding the nature of stakeholder expectations (the "ground rules"), identifying strategic options, and then evaluating and selecting strategic options.
Strategy Implementation
The most important and often the hardest part. When a strategy has been analysed and selected, the task is then to translate it into organisational action and ownership. Without an effective implementation, the best-laid strategies are of little use. Voorne Partners has unique knowledge and tools on how to implement strategy.
