The four steps to developing your business strategy

Developing Business Strategy

This week, I had the privilege of spending some time with post-graduate business students from the local university. The topic for discussion was creating a business plan. The conversation gave me an opportunity to reflect on the matter and put some of my thoughts in writing.
Following are the four ‘C’s to consider when developing your business strategy.

CORE COMPETENCE
First, clarify the core competence of the organisation. In simple terms, this means establishing your key strength. What does your organisation do well? It may be customer service, product development, low-cost manufacturing, communication, innovation etc. But identifying what you are good and excelling at it is critical for success.

COMPETITIVE ADVANTAGE
The next step is to ensure that your core competence is a competitive advantage. In other words, is what you do well, better than your competitors? If, for example, the primary strength of your organisation is logistics, yet you are not significantly better than most others, your business will not be sustainable. An organisation must have a competitive edge in it’s market to exist and excel.

CUSTOMER FOCUS
Is there a user for what you do? Once you have established what you are good at and better at than anyone else, it is important that there is a need for this in your environment.
You may be great at basket-weaving and better than anyone else at it, but if there is no need for basket-weavers, the entire pursuit is futile.
This third step is critical to establishing a performing organisation. Creating and keeping a customer is vital for a sustainable organisation.

COMMERCIALISATION
It is worth noting that organisations do not always need paying customers. Many successful multi-nationals such as the Red Cross, St Vincent de Paul, and the like, have a multitude of customers who do not pay for the services they receive. Where there are non-paying customers, the organisation must still find a way to fund its activities.
Most commercial organisations, however, do require their customers to pay for the benefits received. When developing a business strategy, it is important to establish how best this can be achieved.

Each of these four topics deserves greater consideration, and will hopefully be the subject of future articles.

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