There are plenty of words that you’ll hear a lot as a business executive. Strategy is one of them. From your organizational strategy to your team-based one, you’ll be tasked with organizing plenty of initiatives.
However, have you ever thought about your corporate strategy? Put simply, this is the set of values and objectives that guides your organization forward.
If you haven’t established one yet, it isn’t too late. Today, we’re sharing how to create a future-focused strategy that works.
Start With a Vision
What is corporate strategy? It all starts with a little brainstorming, along with some creative envisioning.
Whether you’ve been in business for 20 years or you’re a new startup, every company needs a firm vision. While it might sound like a New Age ideal, this is actually a well-established corporate practice.
Your vision is where you see your organization going, and the purpose that you want it to fulfill. Look about three to five years down the road, and think about how you want your company to be positioned. You can’t get embrace the full corporate strategy definition until you’ve completed this exercise.
If you’re finding it difficult to get started on your own, you’re not alone. This can be a challenging exercise, especially if you’re used to only thinking about your business in technical, concrete terms.
Thankfully, there are professional consulting firms, like Strategy X, whose primary purpose is to help companies plan, execute, and manage their corporate strategies. You can work one-on-one with these teams to build your company’s success, one step at a time.
Allocate Your Resources
A corporate vision is empty and actionless unless you have people in place to turn it from a dream into a reality. Once you know what your ideal future looks like, it’s time to make sure you’ve allocated the right resources to the effort.
In addition to human capital, this also means investing in the appropriate tools and technologies required to drive your business forward. While you don’t need to invest in every new innovation, take the time to research the ones that can benefit your team the most.
Other resources include stakeholders and partners who share a similar vision and can help you get there. Often, these will be the entities who help supply the capital needed to move your organization from Point A to Point B.
Fine-Tune Your Hierarchy and Design
The next component of your corporate strategy should be organizational design. In other words, how is your company structured and does the current setup provide the most value to your employees, partners, and customers?
Start by considering your C-suite and head office. Then, take a look at your current reporting structure. Are the right workflows in place to make sure everyone has access to the information and resources they need on a day-to-day basis?
If not, then it’s time to make adjustments. Key decisions to make at this time include:
- Will your company operate on a centralized or decentralized organizational structure?
- How much control will each business unit retain?
- How will you delegate and divide larger initiatives into smaller tasks?
- How will you establish authority and reporting guidelines?
There isn’t a right or wrong way to approach your structure, but there needs to be a clear strategy in place. Once it’s established, every employee should have access to the material so there are no gray areas or discrepancies.
Understand Your Greater Market
When you’re trying to define corporate strategy, you must also consider your business units within the greater sphere of your industry. Put simply, where does your company stand in the competitive market?
As you review your competitors, don’t forget to look inward. Your own position will depend on how well your business units work with one another, and the strength of your portfolio. Given your current resources, which business do you feel prepared to enter, and which are you more comfortable avoiding for the time being?
For instance, salon owners might consider branching into the cosmetology space to offer a greater array of services and compete with other, high-end providers in their area. At the same time, they may avoid the nail care space because they do not have the resources or talent on board to competitively pursue it.
Balance Risks and Returns
Long-term business success isn’t possible without assuming a certain degree of risk. As you look into the future and put strategic steps into place, you’ll need to decide how you’ll balance those liabilities with the potential benefits that they could yield.
As you do, keep in mind that your strategy will direct and influence your risk in many ways. For example, consider what would happen if you decided to pursue the strategic initiative of product differentiation.
As you seek to make your goods as unique as possible, you could appeal to a greater number of buyers. Or, you could alienate your loyal followers who already prefer your items as they are. The risk you have to take is whether branching out will put you at the top of the market or the very bottom of it.
If you aren’t sure where to begin, then you can look to others in your space to see what they’ve done to manage risk. While you don’t want to copy their strategy verbatim, you can often find ideas that you can improve upon or customize to meet your own needs.
What Will Your Corporate Strategy Include?
There isn’t a one-size-fits-all type of corporate strategy. Rather, this is an approach that must be tailored to your business circumstance, along with the unique goals that you’ve set in place for your company.
In addition to your executive leaders, don’t forget to listen to department managers and employees as you craft your strategy. This can help you establish a company culture that embraces change and encourages innovation.
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