DEFINING Strategy > Business Strategy Workshop
Business Strategy Workshop
For any business, big or small, having a focused business strategy makes a lot of difference. Strategy gives the conceptual road map for the future direction of the business. This means that the management has considered all the possible alternatives for growth and has selected the prioritized paths which will meet the business objectives, while maximizing Return On Investment and profitability.
Before talking about strategy, the management has to first define and decide where they want to go and to what they want to grow to. These high level business objectives are very critical and they should be defined as crisply and as clearly as possible. These objectives should be based on the ambition and growth possibilities along with market consolidation, new market penetration, exports, product diversification, vertical diversification, growth and other such parameters.
After deciding these objectives we need time lines, with in which we have to achieve these objectives. The time lines for achieving the objectives should be long enough to be realistic and short enough to cater to the market dynamics. We need to keep the specific nature of product or service in mind along with the market demographics and dynamics while deciding on the time lines.
Having decided what to do and by when to do; we need to figure out why we want to do this. This is where the mission and vision of the business come in to picture. Mission and vision give a clarification on why we are in business. The next question to be addressed is where to do business. This is where the playing field is defined. This is very important for freezing the scope of operations with in which the strategy will be defined and implemented. Issues like market consolidation, new market penetration and growth will get addressed here. This will also clarify the expansion plans and define the need and the extent of expansion needed. So far we have defined the scope and the premises. Now, we are ready to discuss how we are going to achieve the defined objectives. Many people try SWOT analysis here. It has its strengths but has a major weakness, as it focuses on current strengths and capabilities and so may not consider some new opportunities. This it prevents out of the box thinking. It confines our possibilities to the past experience and existing capabilities.
What we need to do here is to brain storm and get the ideas flowing freely; without thinking possibilities. Each identified objective will have to be discussed with abandon, bringing out all the possibilities and ideas which can help achieve that. No validation should be done here. All the ideas are welcomed and noted.
The next step is “possibility assessment”. Many people adopt a feasibility assessment with a possibility of rejecting some ideas, based on current capabilities. This is counter productive; as capability can always be built or acquired. The focus should be on how to make a new idea implantable. The costs should be calculated along with time lines. This should be the basic of selection or rejection of any idea; rather than current capabilities. Even funding can be arranged if we are able to identify viable sources. So lack of finds should never be the criteria for rejecting a viable idea.
Having chalked out the possibility analysis of all the ideas; the ROI along with ROIT (ROI Time lines) are to be considered for decision making and selecting the best possibilities. This prevents the summary rejection of new ideas based on current reality. These prioritized possibilities are listed and are taken up as inputs for business planning. The business plan will discuss each of these selected strategies in terms of execution. The tactical inputs and planning will come in to picture here. Mergers, acquisitions, JVs, partnerships, outsourcing and other decisions are made as part of the business planning.
The business plan clarifies a lot of tactical and execution related issues. It will also bring out the budgetary outlays and fund flow statements with break even Analysis and profitability projections. This again clarifies what we need to ensure and make things happen to get the kind of results projected.
Now, a very critical decision needs to be made. Who will implement this plan? The existing team may not have experience and senior people. This will also change some of the existing power equations with in the organization structure. The top management should be open to these changes and commit itself to change for ensuring effective execution of the strategy.
Like any plan, a business plan gets executed in a dynamic business environment. This increases the risks and a regular monitoring and review will be required to ensure appropriate course correction in timely manner, to ensure meeting the objectives
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