How to Build a Business Strategy

A strong business strategy is the foundation for any successful business. It provides direction, goals, and sets a sustainable growth plan in place. Whether you are just starting up a new business or an established business, developing a solid strategy is key to navigate challenges and ensuring you can capitalise on opportunities. You can also share a business strategy (even if it’s a watered down version) with your management team to align the organisation, enabling your team to drive more efficient resource allocation, and decision making.

Here is a guide to get you started, please contact us if you would like any assistance with your business strategy

1. Defining Your Vision

   Your vision outlines where you want your business to be in the future, this should also include a target “mission”. The vision is the end goal, where you want your business to be e.g. “The best in the Midlands for your company goals”, the mission is why you are doing that, your purpose and your values.
   This will then enable you to provide direction, inspire your stakeholders and employees, and establishing a strong identity and market position.
   
   How do you develop your vision statement? Close your eyes and imagine the future of your business in the next 5-10 years. Think about the impact you want to have and how you will change your industry. A vision statement shouldn’t really be longer than 35 words.
   
   How do you develop your mission statement? Look at the root of your business, why you do what you do. Then look at the value you provide to customers and the values that you hold in that. Go back to basics and identify a few core elements

2. Conduct SWOT Analysis

   SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis is a key tool to help identify internal and external factors and capabilities that could impact your business. (An article on this topic will soon be published)
   How do we do a SWOT Analysis? Break it down

   What are your strengths? Think what about what you can do that no-one else can, it could be unique capability or reputation, write down as many as you can think of
   What are your weaknesses? Think about areas that need improvement, like gaps in expertise, market presence, maybe a team that isn’t performing
   What are your opportunities? Look for trends and unmet customer needs. If you think about where you can make a difference, that is an opportunity
   What are your threats? Look for competition, incoming regulation changes, the economy, and disruptions in your processes. Anything that could effect your business or your customers.

   Once you’ve done this, your SWOT analysis is complete, next we need to think about how we’re using the information.

3. Set SMART Objectives

   SMART Objectives are about breaking down your goals into easy chunks, and is an acronym that stands for Specific, Measurable, Achievable, Relevant, Time

   S: Set a specific goal in mind, for instance wanting to improve sales of a particular product
   M: How are you going to measure this? What is the target? Setting sales goals of your product to a 10% increase would mean that you can take your existing data and you can measure against that
   A: Is this realistic? Is this something that is even possible? Most of the time you wouldn’t be able to say “I want to increase sales of this product by 200%”. You need to be honest with yourself
   R: Is this relevant? If this doesn’t align with the vision from step 1, then why are you looking at this?
   T: Set yourself an a realistic timeframe, let’s say increasing sales by 10% within 1 financial quarter
   Bringing this all together you would end up with a statement like this:
   ”We want to improve sales of product X by 10% by the end of the quarter. This is in line with market growth and is key to our vision of being the number 1 supplier of competitor products.”
   Do this for short term (within the next year), medium term (1-3 years), and long term (3+ years). These should all align into your Vision and Mission statements.

4. Understanding Your market

   As stupid as it sounds, you may not know your market as well as you think. Continuous market research is important, but even more so when developing your strategy. You need to understand your market to understand where your strategy falls into this. There are three main market research methods

   Primary Research: Surveys, Interviews, Focus Groups
   Secondary Research: Industry reports, competitor financials, market trends
   Competitor Analysis: Evaluating strengths and weaknesses (SWOT is useful for this), pricing models, strategies and products

5. Developing Your Value Proposition

   Your Value Proposition is what makes you unique, and is the added value you can give your customers. Think about steps 1-4 here and write down some ideas for the following

   What are your customer pain points?
   What makes you different?

   Put these together, slotting them into your Vision and Mission statements to produce a coherent value proposition.

6. Identifying Your Target Audience

   Next we need to define our ideal customer profile. Look at demographics, behaviours, and pain points. If you understand your customers, then you understand where your focus may need to be.

   There are three key ways to identify the target audience:
   Segment your market: Group customers based on available information such as age, income, or location.
   Create Customer Avatars: Develop detailed profiles of ideal (and non-ideal) customers, look at journeys, pain points, and motivations to create a complete character.
   Data Analytics: Use existing data of your customers to review and refine these profiles and targeting approaches. If you don’t have a data analysis or gathering plan in place, that should be one of your Business Objectives from point 3
   

7. Review or Choose Your business model

   Your business likely already has a business model and plan in place. But it’s worth reviewing if this is still the right model, having been through each previous step.
   Some models to investigate and evaluate are:
   Subscription Based
   E-Commerce
   Freemium
   Services
   Product

8. Develop an actionable plan

   Together we have now built up a picture of what your business looks like and what your customer looks like. The next step is to bring this all together into one coherent plan. Working through each of these steps to produce a document that would contain strategies for Marketing, Sales, and Operations.

9. Continuous Review

   A business strategy is a long term plan, but requires regular reviews to see if the plans in place are still realistic and appropriate. Once implemented create dashboards and don’t be afraid to adjust

10. Adapting to change

    "The best laid plans of business-mice and men often go awry” We all know that business environments change rapidly. By continiously reviewing this you stay updated on market trends, to be able to respond to new opportunities or challenges as they come up. Remember to foster innovation, invest in your teams and their training, and monitor what your competitors are doing.

You should now have a complete basic business strategy, but if you need some more assistance you can contact us here