Why is strategy so important? Let me tell you why - STO Consulting

Why is strategy so important?

 

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strategy

Having decided to specialise in the development of business strategy, it seems like a reasonable question to ask … Why is a strategy so important?

Perhaps it is a pertinent time to ask such a question: Everyone knows that it’s a difficult time for businesses at the moment. What should businesses do to best manage in the current circumstances? What support do businesses most need? It is tempting to seek easy answers to such questions, and of course, such answers abound. But how should we consider and evaluate our options?

The term ‘marketing’ is bandied about a lot – often without any common acceptance of what it means. Discussions take place between individuals who mean different things by the same term or have a limited understanding or a disregard for what it actually means. Hence the abundance of what I consider to be misleading hybrids such as ‘sales and marketing’, ‘marketing and PR’ or ‘marketing and events’.

So, I certainly didn’t want to set up a ‘marketing’ company.

The reason for my belief in the importance of strategy can be described as follows:

The quality of a product or service is nowhere near the most important factor determining success or failure in business. It is, however, a pre-requisite. Of course, lots of bad products fail, but lots of exceptional ones do also. What really matters is matching what you do to external needs in a form that customers are prepared to pay for. They also need to choose you over others – even if others have been around longer or are cheaper. This is the essence of marketing strategy and this is what I concern myself with.

I wish to see good companies with good products and services succeed and grow. I am aiming therefore to do two things: Reinstate marketing strategy to its rightful place (as one of the 4 key strategic functions that all businesses do) and implement this well.

The point is that strategy, tactics and operations should be considered in that order – with the strategy being the top level means of achieving objectives and the tactics and operations flow from this.

The above should be considered an immutable truth, yet it is surprising how often this is overlooked.

The point is that you cannot define strategy by linking it to specific, pre-determined operations or activities; otherwise, it is not a strategy. It is a plan. There are as many strategies as there are companies. Of course, each tactical activity will need to be planned, and this is extremely important. But your business has only one strategy – whether you have formally acknowledged this or not.

For a start up business, I would put it this way:

You have a business idea … It’s a good one … You are enthusiastic about it …

BUT:

That is not the determining factor in success or failure of your business

  • How do you ensure your product or service meets existing customer needs?
  • How can you do this better than the competition?
  • What communications do you use to get your message accross?
  • Who is your target audience? Why?
  •         Who can you partner with that has complementary skills?

These are the questions that I believe any new venture should seek to answer.

I am also concerned with integrating marketing thinking into all areas of business, ensuring it is a pervasive, complimentary force for the achievement of your objectives. After all, if it is not effective then it is not worth doing.

In summary, there seems to be confusion all around regarding what ‘strategy’ actually means.

Some definitions appear to conflate strategy and planning; using them interchangeably or in the oxymoronic concept of a ‘strategic plan’. Others seem to suggest that the only difference is the timeframe. Others, I am sure, use ‘strategy’ to give an appearance of sophistication. For me, it would be an understatement to say that strategy is so much more than this.

This is my contribution on the issue, and I am sure I will return to each aspect of it in the coming weeks and months.

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