Strategy is what you are not doing

Published on April 28th, 2019 at 11:21 am in Business Development

Business strategy is focus

At the real-world level (my favorite), strategy is like driving: we all think we’re pretty good at it. But simplifying, doing today what will seem obvious tomorrow, is genius.

I say the best strategies seem obvious as soon as you understand them. Furthermore, it seems to me that if they don’t seem obvious after the fact, they didn’t work.

Strategy has to be easy to define. I like the simple plan method, which I will explain here. But aside from that one, I’ve also worked in depth as a consultant with several competing strategy frameworks, and every one of them works well if it’s applied correctly and executed. And furthermore, I say you can also define strategy with a simple summary, story, or a small collection of stories, which I’ll also explain here.

1. The simple strategy method

Think of it as the heart of the business, like the heart of the artichoke. It’s a group of core concepts that can’t be separated: problem, solution, market, and identity. Don’t pull them apart. It’s the interrelationship between them that drives your business. Each affects the other three.

The problem you solve

We forget too often, so start with this: Your business is not about you, what you like to do, or what you want from it. It’s about your customers. And, most important, the problem you solve for your customers.

Real businesses solve problems and to develop an effective business strategy, they have to know what problem they solve. For a social media company that posts updates for its clients, the problem it solves is not social media—it’s getting the word out, and getting people to know about their clients’ businesses.

Consider a bookshop for instance, the book seller doesn’t solve the problem of books by merely selling them, he solves the problem of ignorance by selling books.

You also need to understand what business you’re in. The bookshop might be helping families with books as they grow, or it might be offering real expertise to the serious researchers. Those are different businesses.

2. The solution: Your product or service

Your solution to that problem is your product or service. Focus on the true desired end result for your customers—the holes too, not just the drill.

Take the bookshop for example. One solution is a bookshop catering to children, youths and families. Another very different solution is a bookshop catering to researchers basically, such as scholars, scientist etc. These are individuals engaged in serious and meaningful research work that could impact society for generations.

That’s strategy at work.

3. The market: Who buys your solution

Your identity influences your choice of target market.

Bookshop “a” focuses on attracting book enthusiasts, offering inexpensive but quality books for the avid reader. Bookshop “b” researched-focused shop, focuses on attracting the inventors and the creators concentrating on high-level quality books that are rare, yet capable of affecting our world for the better

Keep your business focused on specific target markets. The research bookshop owner has to know his products are too expensive for kids, students and families. Likewise, the ordinary bookshop shouldn’t scare away its target market with very expensive books. Know your target and choose it wisely.

4. Your business identity (why us)

Every business has its core identity. How are you different from others? What are your strengths and weaknesses? What is your core competence?  What are your goals? What makes you different?

We have the examples above of the varieties of problems, solutions, and markets related to a bookshop. To understand identity as a part of strategy, think about the difference between a bicycle retail store owned and operated by a former professional bike racer, and another one owned and operated by a couple with children who like cycling as a family activity.

The first one will gravitate toward stocking and selling expensive, sophisticated bicycles for the racing enthusiast and extreme long-distance or mountain biking hobbyist. The second will probably emphasize bicycles for children, bike trailers, carriers, and accessories for families.

I hope the example illustrates how the owners’ identity affects strategy in strengths and weaknesses, knowledge and focus, and choice of product and target market.

Seth Godin’s book “The Dip” is about being the best at one thing. That’s the point of your focus. Since you can’t do everything and even if you could, your customers wouldn’t believe you, you need to focus on something that you do well, that people want.

Part of your identity is what you want from your business. Some businesses are about your lifestyle or pursuing your passion. Some people want their businesses to grow as big and as fast as they can and are happy to work with investors as owners. Others want to own their own business, even if it has to grow more slowly for lack of working capital.

What’s your case? If you’re committed to an extra income in a home office, incorporate that into your identity. Don’t look for generalized formulae; let your business be unique.

Roll them up together

These four things, problem, solution, market, and identity, are your business strategy.

Don’t pull them apart. Don’t take them one at a time. Don’t ever stop thinking about them. Remember, in planning—as well as in all of business—things change. Keep watching for the change.

Strategy is what you’re not doing.

Business strategy is focus

At the real-world level (my favorite), strategy is like driving: we all think we’re pretty good at it. But simplifying, doing today what will seem obvious tomorrow, is genius.

I say the best strategies seem obvious as soon as you understand them. Furthermore, it seems to me that if they don’t seem obvious after the fact, they didn’t work.

Strategy has to be easy to define. I like the simple plan method, which I will explain here. But aside from that one, I’ve also worked in depth as a consultant with several competing strategy frameworks, and every one of them works well if it’s applied correctly and executed. And furthermore, I say you can also define strategy with a simple summary, story, or a small collection of stories, which I’ll also explain here.

1. The simple strategy method

Think of it as the heart of the business, like the heart of the artichoke. It’s a group of core concepts that can’t be separated: problem, solution, market, and identity. Don’t pull them apart. It’s the interrelationship between them that drives your business. Each affects the other three.

The problem you solve

We forget too often, so start with this: Your business is not about you, what you like to do, or what you want from it. It’s about your customers. And, most important, the problem you solve for your customers.

Real businesses solve problems and to develop an effective business strategy, they have to know what problem they solve. For a social media company that posts updates for its clients, the problem it solves is not social media—it’s getting the word out, and getting people to know about their clients’ businesses.

Consider a bookshop for instance, the book seller doesn’t solve the problem of books by merely selling them, he solves the problem of ignorance by selling books.

You also need to understand what business you’re in. The bookshop might be helping families with books as they grow, or it might be offering real expertise to the serious researchers. Those are different businesses.

2. The solution: Your product or service

Your solution to that problem is your product or service. Focus on the true desired end result for your customers—the holes too, not just the drill.

Take the bookshop for example. One solution is a bookshop catering to children, youths and families. Another very different solution is a bookshop catering to researchers basically, such as scholars, scientist etc. These are individuals engaged in serious and meaningful research work that could impact society for generations.

That’s strategy at work.

3. The market: Who buys your solution

Your identity influences your choice of target market.

Bookshop “a” focuses on attracting book enthusiasts, offering inexpensive but quality books for the avid reader. Bookshop “b” researched-focused shop, focuses on attracting the inventors and the creators concentrating on high-level quality books that are rare, yet capable of affecting our world for the better

Keep your business focused on specific target markets. The research bookshop owner has to know his products are too expensive for kids, students and families. Likewise, the ordinary bookshop shouldn’t scare away its target market with very expensive books. Know your target and choose it wisely.

4. Your business identity (why us)

Every business has its core identity. How are you different from others? What are your strengths and weaknesses? What is your core competence?  What are your goals? What makes you different?

We have the examples above of the varieties of problems, solutions, and markets related to a bookshop. To understand identity as a part of strategy, think about the difference between a bicycle retail store owned and operated by a former professional bike racer, and another one owned and operated by a couple with children who like cycling as a family activity.

The first one will gravitate toward stocking and selling expensive, sophisticated bicycles for the racing enthusiast and extreme long-distance or mountain biking hobbyist. The second will probably emphasize bicycles for children, bike trailers, carriers, and accessories for families.

I hope the example illustrates how the owners’ identity affects strategy in strengths and weaknesses, knowledge and focus, and choice of product and target market.

Seth Godin’s book “The Dip” is about being the best at one thing. That’s the point of your focus. Since you can’t do everything and even if you could, your customers wouldn’t believe you, you need to focus on something that you do well, that people want.

Part of your identity is what you want from your business. Some businesses are about your lifestyle or pursuing your passion. Some people want their businesses to grow as big and as fast as they can and are happy to work with investors as owners. Others want to own their own business, even if it has to grow more slowly for lack of working capital.

What’s your case? If you’re committed to an extra income in a home office, incorporate that into your identity. Don’t look for generalized formulae; let your business be unique.

Roll them up together

These four things, problem, solution, market, and identity, are your business strategy.

Don’t pull them apart. Don’t take them one at a time. Don’t ever stop thinking about them. Remember, in planning—as well as in all of business—things change. Keep watching for the change.

 

 

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