2.15 Summary

A brief introduction to the basic process of choosing a strategy, as well as how to use the book. Ask various questions to help the reader think about what his/her business really excels at and will be successful at.

Planning strategy is essentially when a person sits down, creates a plan for the business, and puts it into action.

A Crafting strategy is one where business leaders adapt the strategy as they learn more about the market and the business. It is molded and shaped over time.

An Emergent strategy is a strategy that comes about without structured plans or delineated changes but comes from the needs of the market. This kind of strategy could be thought of as a pivot from the planned or crafted strategy.

A SWOT analysis looks at the Strengths, Weaknesses, Opportunities, and Threats that face your business. This is a very common analysis to perform when assessing a company for potential strategies.

Mission and Vision Statements focus on the big picture of a company - the reason it exists, its overall dream, and how it will achieve its goals. These help a company see its core focus and desires.

Points of parity are the features and services that all companies in your market must provide in order to compete. Points of differentiation are the features or services that set your company apart.

A PESTLE analysis looks in greater depth at the opportunities and threats a firm is confronted with. PESTLE stands for Political, Economic, Social, Technological, Legal, and Environmental factors facing a firm.

Organizational Resources are the different forms of capital (human, physical, financial, informational, etc.) that are available to an organization. An effective strategy must be backed by the correct organizational resources.

The balanced scorecard looks at your business from four different perspectives: a financial perspective, a customer perspective, a business process/internal perspective, and a learning/growth perspective.

The Product Revenue Analysis looks at which products bring in the greatest percentage of your revenue, allowing you to determine what to focus your company efforts on.

The VRIO Framework looks at the comparative advantage that a company offers to consumers. It looks at the value, rarity, imitability, and organization of the product, service, resource, or idea that it offers to customers.

The Internal and External Factor Evaluation Matrices seek to take some of the subjectivity out of assessments by giving each relevant business factor a weighted score. This allows for more objective evaluations of both your company and your competitors.

The McKinsey 7S Model looks at the Strategy, Structure, Systems, Shared Values, Staff, Style, and Skills of your business. It helps you balance your company, seeing which areas you excel in and which areas are weaknesses.

Strategic fit looks at how well various aspects of your business mesh with your strategy. This can be seeing if your strategy fits your market, looking at whether a particular project fits with your strategy, or determining if you have the organizational resources to accomplish your strategy.