Different Types of Business Strategies

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Different Types of Business Strategies are available to any startup or a business.

Basic Approach to Strategic Planning

A critical review of past performance by the owners and management of a business and the preparation of a plan beyond normal budgetary horizons require a certain attitude of mind and predisposition. Some essential points which should to be observed during the review and planning process include the following:

  • Relate to the medium term i.e. 2/4 years
  • Be undertaken by owners/directors
  • Focus on matters of strategic importance
  • Be separated from day-to-day work
  • Be realistic, detached and critical
  • Distinguish between cause and effect
  • Be reviewed periodically
  • Be written down.

As the precursor to developing a strategic plan, it is desirable to clearly identify the current status, objectives and strategies of an existing business or the latest thinking in respect of a new venture. Correctly defined, these can be used as the basis for a critical examination to probe existing or perceived Strengths, Weaknesses, Threats and Opportunities. This then leads to strategy development covering the following issues discussed in more detail below:

  • Vision
  • Mission
  • Values
  • Objectives
  • Strategies
  • Goals
  • Programs

Strategic statements can be defined as broad indicators of the direction(s) in which a business should be driven in order to fulfil its vision/mission while taking realistic account of its resources, constraints and opportunities.

In the case of a start-up venture, organic and quantum approaches translate into soft or hard start-up strategies. An example of a soft start would be a software company which evolves from a part-time business into full-time service provider and then progresses into software products (classic “back room” start). Another example, would be an engineering company which starts in a shed and gradually moves into a proper premises (“garage” start).

Soft start strategies can be very effective as they allow entrepreneurs to learn the trade (and make mistakes) without incurring major, irrevocable (and maybe premature) commitments. Hard starts are obligatory where substantial investments (in R&D, market or assets) or resources (technology, manpower etc.) are needed from the outset. It may be possible to soften a hard start by renting (rather than buying) premises; leasing equipment (instead of purchasing); acquiring a franchise (in lieu of developing a new brand, systems etc.); entering into a joint venture; or subcontracting manufacturing, distribution, accountancy services and so on.

Before deciding on what type of strategy to adopt you will need to have the following statements if you are an existing company or you will need to work through what is posted here before you decide.

Different Types of Business Strategies

Note Well.

The preparation of a strategic plan is a multi-step process covering vision, mission, objectives, values, strategies, goals and programs you need to initiate to complete the strategy decide upon.

Vision.

 

 

Mission.

The nature of a business is often expressed in terms of its Mission which indicates the purposes of the business, for example, “to design, develop, manufacture and market specific product lines for sale on the basis of certain features to meet the identified needs of specified customer groups via certain distribution channels in particular geographic areas”. A statement along these lines indicates what the business is about and is infinitely clearer than saying, for instance, “we’re in electronics” or worse still, “we are in business to make money” (assuming that the business is not a mint !)

Peter Drucker says “Mission: Why you do what you do; the
organization’s reason for being, its
purpose. Says what, in the end, you want
to be remembered”

There are many tools that you can use to define your strategic position in your market,and what sort of strategy you should adopt.

One of them is the GE matrix. The GE matrix helps a strategic business unit evaluate its overall strength. Each product, brand, service, or potential product is mapped in this industry attractiveness/business strength space. The GE multi factoral was first developed by Mckinsey for General Electric in the 1970s.In order to use the GE Matrix you need to understand the market you are in and you must have a very good grasp of strategy.

I have modified the GE And the GE McKinsey graph as seen below.

I addition to giving you two points on a square block i have added what type of strategy best fits each quadrant. This has been developed by me over 3 decades of in company research, as Africa Director responsible for growth and development. The Group I worked for was massive as it had more than 136 companies in its stable.

You are asked to identify percentages in a range of questions and give an indication of your strategic ability.

When Completed you will get a Graph as shown here. Careful consideration is needed when compiling the answers.

https://www.mjfgroup.biz/gematrixamendedbymjfgroup

Click on this link to download the Free excel spreadsheet, which I modified to give You a better picture of what strategy you should follow. A Resulting graphic display will clearly tell you in which quadrant that you can

Different Types of Business Strategies.

Growth Strategy
Any growth strategy entails introducing new products or adding new features to existing products.

Sometimes, a small company may be forced to modify or increase its product line to keep up with competitors. Otherwise, customers may start using the new technology of a competitive company.

For example, cell phone companies are constantly adding new features or discovering new technology. Cell phone companies that do not keep up with consumer demand will not stay in business very long.

A small company may also adopt a growth strategy by finding a new market for its products. Sometimes, companies find new markets for their products by accident. For example, a small consumer soap manufacturer may discover through marketing research that industrial workers like its products. Hence, in addition to selling soap in retail stores, the company could package the soap in larger containers for factory and plant workers.

Product Differentiation Strategy
Small companies will often use a product differentiation strategy when they have a competitive advantage, such as superior quality or service. For example, a small manufacturer or air purifiers may set themselves apart from competitors with their superior engineering design. Obviously, companies use a product differentiation strategy to set themselves apart from key competitors. However, a product differentiation strategy can also help a company build brand loyalty, according to the article “Porter’s Generic Strategies” at QuickMBA.com.

Different Types of Business Strategies

Price-Skimming Strategy
A price-skimming strategy involves charging high prices for a product, particularly during the introductory phase. A small company will use a price-skimming strategy to quickly recover its production and advertising costs. However, there must be something special about the product for consumers to pay the exorbitant price. An example would be the introduction of a new technology. A small company may be the first to introduce a new type of solar panel. Because the company is the only one selling the product, customers that really want the solar panels may pay the higher price. One disadvantage of a price-skimming is that it tends to attract competition relatively quickly, according to the Small Business Administration. Enterprising individuals may see the profits the company is reaping and produce their own products, provided they have the technological know-how.

Acquisition Strategy
A small company with extra capital may use an acquisition strategy to gain a competitive advantage. An acquisition strategy entails purchasing another company, or one or more product lines of that company. For example, a small grocery retailer on the east coast may purchase a comparable grocery chain in the Midwest to expand its operations.

Please contact us so we an assist you with a complete strategy and corresponding tactics needed to achieve your strategy chosen.

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SAY OF THE DAY

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Our SAY OF THE DAY is “Difficulties mastered are opportunities won.” – Winston Churchill

For those of you who need to register, I urge you to register and take advantage of many Free offers in my site for Your Business.

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SAY OF THE DAY

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Business Improvement

Dear CEO/Managing Director, Executive Director we are creating this post to tell you that Business Improvement is at hand

Does your business suffer from:https"//www.mjfroup.biz/

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Business Improvement

You have so many issues to attend to, your staff are all ‘so busy” they cant support you and if they had time would not be as competent as you would like them to be in order to support you.

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Google Alerts

I receive Google Alerts daily so I have decided to share with those who are registered as Subscribers on my site. I urge you to do so. Once done I will check the veracity of the registration as I am being plagued by persons who attack my site with unsuitable comments.

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Google Alerts

Business Leadership SA welcomes Eskom back to the fold

South African power utility Eskom has on Friday, been welcomed back to the … on November 9 and 10 , to garner investor support and trust for the company. … Mohale said that business believes in South Africa’sfuture and wants to …
Asian automotive companies on the hunt for growth in Africa

With the support of the China-Africa Development Fund, the FAW Group has set up an assembly plant in Coega, South Africa, with its first commercial …
Now for something completely different.

At last! A Simple Step By Step Sales And Marketing System That Anyone Can Apply To Their Business – No Matter What Your Experience, No Matter What Product Or Service You Sell, And No Matter How Fierce The Competition Is…

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Finding a home on the Moon

Maybe you’ve always wanted to live on the moon but didn’t think it was possible. Well, think again. Although NASA has placed astronauts on the surface of the moon on six occasions, they didn’t stay there for more than three days because of the dangers .

 More on the Xtreme Business program.

“How To EXPLODE Your Sales And Profits, Get Customers By The Bucketful, And Keep Them Coming Back For More” The Xtreme Business Program ™ is the first program of its kind that acts like your personal mentor and fast tracks you and your business to reach your goals and aspirations. You, yes you, can do it when you follow this ‘paint-by-numbers’ Program…

Appoint one of our experienced advisors to mentor you through this 3-month program and see how your turnover and profits climb drastically.

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The 10 Most Valuable Global Brands in 2017

https://www.mjfgroup.biz/The 10 Most Valuable Global Brands in 2017

The 10 Most Valuable Global Brands; Click on the graphic to see the full article.

https://www.mjfgroup.biz/The 10 Most Valuable Global Brands in 2017

If you require assistance in your branbranding strategiesding efforts please contact Gloria to set up an appointment for the New Year

 

 

 

 

So what is a Global Brand?In a recent newsletter from Lehigh University

In a recent newsletter from Lehigh University, the question was posed to Professor David Griffith.

So, what is a global brand? Is Coca Cola a global brand, U.S. brand or a local brand? Would a consumer in the U.S. relate to it the same as a consumer in India?

The 10 Most Valuable Global Brands in 2017

“Brands have become increasingly curious and confusing. What we have been discovering is that consumers relate in very different ways to brands. While one consumer may view a brand as being global, another may view that same brand as being local (or domestic).  We’re seeing a great deal of research working to understand how consumers relate to brands. Much of this research has focused on the issue of global vs. local, “glocal” brands and regional brands. “Glocal” brands can be considered a global brand that has worked to localize themselves by creating a strong connection to the local markets that they serve. In essence, they have worked toward the “think global, act local” philosophy.” says Griffith.

If you need a consultant to work with you to develop your brand please contact us.

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