Strategic Areas for Consideration
The basic strategic variables for consideration as you make a plan for the future are products, services, customers, markets, finances, people, technology, and production capability. These are the areas of your business that you may continue as before or change, depending on your strategic goals.
Products and Services
What exactly are the products and services that you are planning to offer? What do they do to change or improve the lives or work of your customers? What is it about them that makes them clearly superior and the best choice for the customers that you are going after?
Who is your ideal customer, your perfect customer? What are the demographics of your ideal customer? What is this customer’s age, education, income, occupation, and level of family formation?
What are your customers’ psychographics? What are their goals, ambitions, desires, and aspirations? What are their fears, misgivings, or suspicions that might cause them to hesitate from buying your product or service?
Especially, what are their ethnographics? What do they use your product or service for? How do they use it? How does it change or improve their lives in some way?
In the past, you chose your product, then sought out customers. In many cases today, however, companies are identifying the customer and the customer’s exact needs and then retrofitting or reverse engineering product and service development based on what the customer says he or she wants. Companies are moving from “product development” to “customer development” and not even creating the product until the customer has agreed to buy it at a particular price.
Markets
What markets are you going to enter? How are you going to penetrate these markets? Are you going after geographic markets, horizontal markets, or vertical markets? Who are your competitors in these markets? How do you need to advertise, promote, sell, and otherwise penetrate these markets?
How much money do you have, and how much money will you need to achieve and sustain profitability?
People
Who are the key people you will need in terms of skills, abilities, and proven competence? Where and how will you get and keep these people?
Technology
What sort of technology will you require to build and operate your business? Is your current technology sufficient and satisfactory in light of the rapid changes in technology that your competitors are adapting?
Production Capability
Finally, what is your production capability? How much can you produce, deliver, sell, and service in a competent fashion? What do your products or services cost to produce, sell, deliver, install, and service?
Set Clear Goals
A few years ago, Fortune magazine reported on a study that was done to determine why so many CEOs were being let go from Fortune 500 companies. The most important reason cited was “failure to execute.” The CEOs had been placed in their positions with clear, specific performance expectations for their respective companies. In each case, the executive had not achieved the goals and objectives laid out from the start.
Every month, you hear or read about top executives who are dismissed by their corporations because of the failure to achieve the key objectives of sales and profitability for which they were responsible. Lack of clarity about what those objectives actually were is almost always a major factor in the failure to achieve those objectives over time.
Successfully leading your company’s strategy depends on your having the same laserlike focus on goals. You cannot implement your strategy if you do not have absolute clarity on the strategic goals of the company.
What is your main objective for your business or for your position? What are you trying to do? How are you trying to do it? Could there be a better way? Are your goals and objectives realistic based on the current situation? What are your assumptions? What if your assumptions are wrong? What would you do then?
As Peter Drucker said, “Errant assumptions lie at the root of every failure.”
Always be open to the possibility that you could be doing the wrong thing. Your business model may be obsolete. What seemed like a good decision at one time, in one or more of these areas, is no longer a good decision today.