As I write, we’ve just welcomed in a new fiscal year and I wonder if you and the leadership team at your business venture might be inspired to revisit strategic plans made at the start of the calendar year? I think you will find it useful to review the Key Performance Indicators associated with the strategies you chose to follow, so that successes can be recognized and mid-course corrections can be made, if necessary.
The ability to create and sustain business success involves strategic planning. Devising and implementing plans for your organization encourages the leadership team to revisit the purpose of the venture—its vision and mission, goals, guiding principles (culture and values) and business model—and evaluate how that purpose is reflected in the products and services that are sold to customers. Below are six strategic planning and positioning principles that will help you create conditions for success at your enterprise.
Principle 1: Sustained profitability
The conditions for generating profits are created when clients value your products or services enough to pay more than what it costs the business (you) to produce and provide them. Strategic planning is your opportunity to define business goals and objectives and devise strategies and action plans with thoughts of short and long-term ROI in mind. Assuming that profits will be inevitable if sales volume and market share are the only measurements of success could be misleading.
Principle 2: Value proposition
Be certain that what company leaders consider to be the value proposition—that is, the most desirable benefits—matches what target customers consider to be the value proposition. Do not attempt to produce and offer products and services that you expect will be all things to all prospects. A business needs strategies that allow the venture to compete in a way that allows it to effectively and efficiently deliver what its most loyal customers feel has value.
Principle 3: Competitive advantage
Those highly desirable benefits that sustain the value proposition must be reflected in and supported by strategies that shape them into sustainable competitive advantages. The successful enterprise will differentiate itself from competitors through not only the products or services offered, but also how those are packaged and/or delivered, customer service practices, pricing, branding and so on. Those unique features and practices will matter to current and prospective customers. Nevertheless, the company’s business model may resemble that of its rivals.
Principle 4: Choices and priorities
Resources are always finite and choices about your products and/or services must be made, in order to understand what is necessary and possible and therefore, a priority. Some product or service features will not be offered, so that the benefits (priorities) that clients have anointed as highly desirable can be optimized. Those priorities are what sets the business apart from competitors and defines the brand.
Principle 5: Flow
Choices and priorities must be baked into the strategies that the leadership team follows, to enhance and enable the consistent delivery of the value proposition. These strategies will be both stand-alone and interdependent, like dominoes. For example, choices made to pursue certain target customers and not others will impact product design and by extension will also impact the manufacturing process, manufacturing location and cost.
Choices that determine what will and will not be included in a service will be influenced by the most loyal customers and will impact how that service is delivered and priced. Choices about product positioning and branding will impact the marketing strategy, which will influence the advertising media outlets selected and the social media platforms used.
Principle 6: Direction
The late style icon Diana Vreeland, who was Editor-in-Chief at Vogue Magazine from 1963 to 1971, once said that “elegance is refusal.” A company must define its unique value proposition and that will eventually cause certain potential choices to be declined, because they are contrary to the brand. The product or service lines can be altered to satisfy customer demands over time and business models can be adjusted to reflect current or anticipated market conditions. Nevertheless, the vision and mission must be upheld to maintain brand awareness and trust. Strategic direction will guide that process.