What is Strategy?

Many definitions of ‘strategy’ have been developed, and close examination of such definitions tends to converge on the following: strategy is concerned with making major decisions affecting the long-term direction of a business.

Strategic problems can be viewed as having three distinct components. Firstly, analysis; we need to understand the business environment and the resource capabilities of the organisation. This needs to be considered in the context of the organisation’s culture and the aspirations and expectations of the stakeholders. Note, ‘stakeholders’ are taken to be anyone with a stake in the organisation (e.g. customers, employees, suppliers, etc.).
Secondly, managers need to make strategic choices (formulation). This is achieved via a process of identifying, evaluating and selecting options. The organisation needs to define:

• what the basis of our strategy is – so-called ‘generic’ strategy,
• what product/market areas we will operate in and developing specific strategies to achieve corporate goals.

Finally, the issue of implementation must be considered. There is a need to plan actions, allocate resources and, where appropriate restructure to achieve strategic change.

Click here to view a video on how to develop an effective marketing strategy.