Strategy is a term that is often bandied about by many without a crystal clear understanding or definition of what it actually means. We’ve unpacked the term to present a simple view of strategy.
What is Strategy?
- Strategy is the company’s compass.
- Strategy has both magnitude and direction.
- Strategy is NOT a detailed plan.
- Strategy guides the act of planning.
- Strategy must be responsive to change.
What the Experts Say About Strategy?
According to Michael Porter…
“The essence of strategy is choosing to perform activities differently than rivals do.”
According to Kim and Mauborgne…
“Strategy hinges on the development and alignment of three propositions.”
- Proposition 1: “A value proposition that attracts buyers.”
- Proposition 2: “A profit proposition that enables the company to make money out of the value proposition.”
- Proposition 3: “A people proposition that motivates those working for or with the company to execute the strategy.”
Henry Mintzberg says strategy is:
- A Plan: A consciously or purposefully intended course of action, a guideline, set of guidelines to deal with a situation.
- A Ploy: As a plan, strategy can be a ploy to outwit an opponent or a competitor.
- A Pattern: Strategy is consistency in behaviour, whether or not intended. A company may exhibit a pattern in its actions. This in itself becomes strategy. There may be a plan behind these set of actions or there may not be.
- A Position: Strategy as a means of locating the organisation in the external environment. The organisation’s decision to compete in a specific market is itself strategy. (Niche, Ecological).
- A Perspective: Strategy as an ingrained way of seeing the world. (Some companies are aggressive pacesetters).
Why Have a Strategy?
- To focus on the right set of activities.
- To maximise the organisation’s resources and efforts.
What is a Product Strategy?
- It is a set of guiding principles and product goal(s).
- The product’s guiding principles and goals must be underpinned by the business strategy.
What do I Need to Create a Product Strategy?
- Strategy requires knowledge.
- Strategy requires process.
- Strategy requires tools.
Formulating a Product Strategy
10 Questions to Help You Formulate Your Product Strategy
- What is the purpose of the product in the market?
- What is the purpose of the product for the business?
- What do we want the product to achieve?
- Which markets do we want the product to serve?
- How do we want the customer to feel?
- What additional value do we need to develop in our product?
- Who else is offering the same value in the market?
- What capability do we have to create the value?
- What constraints do we have to consider?
- How fast do we have to move?
Some Strategic Tools
To help answer the 10 questions, select and use the following tools:
- Customer Insights
- Business Success Factors: Vision, Mission
- SWOT Analysis
- Porters 5 Forces
- Competitor Analysis
- Scenario Planning
- Market Segmentation
- Value Curve Analysis
- Strategic Risk Assessment
- Profit & Loss Statement
When developing your product strategy, keep it simple and focus on articulating it succinctly and clearly so that all can understand and implement.
Here’s a copy of our presentation. Strategy Briefly Explained
Drop us an email at email@example.com if you want us to speak about Strategy at your school or company.