In the last post, I explained that a strategy was a set of objectives, a plan that could be distilled down into executable tactics for each operating unit of the company.
But, let’s go a little deeper. There are characteristics of a “strategic plan” that make it unique from, say, a business plan.
A strategic plan has a longer term horizon – at least three to five years. The key characteristic of a strategic plan is that it lays out a plan for your company’s success in its market, defines what makes it distinctive from its competitors, and what tactics you will deploy to ensure that you win!
A strategic plan is different from an operational plan in that it specifies what customers must be targeted and secured, what products or services must be developed or expanded, and what geographies to target for expansion. An operational plan provides tactics for running the company. The strategy articulates how your company does this better and differently than your competitors.
According to Michael Porter in his infamous dissertation in Harvard Business Review in December 1996 called “What is Strategy?,” he states that, “A company can outperform rivals only if it can establish a difference that is can preserve.”
Stated more plainly, a main component of a strategy is to provide sustainable competitive differentiation from your rivals. And herein lies the key challenge to strategy development…to understand how your company competes now and in the future to ensure that growth and profitability can be sustained.
This may seem very esoteric and theoretical. But, at Calade Partners, we have the experience to guide you through very disciplined steps to develop your company’s strategy. To succeed in the future and ensure continued top and bottom-line growth, a clear, precise strategy is required.
In my next post, I will discuss some of the steps to strategy development. If you would like more information about Calade Partners, click here.