In today’s world, businesses have to be willing to shift and adapt at just about any moment. As we’ve seen in 2020, anything could happen to dramatically change the market and make even the strongest organization falter. With that said, you can’t bounce around from idea to idea and expect to be successful.
If you want to build a strong and resilient business that can bounce back after a major setback like a pandemic, you have to do more than set organizational goals. Clarity about your organization’s strengths and values can help you to develop what is known as business level strategy. But what is business level strategy, and how can you implement it into your own company?
What is Business Level Strategy?
Business level strategy isn’t about your company’s vision, mission, and values. While those factors will help to guide your strategy, they are not enough on their own to drive success within an organization. Business level strategy has to do with determining your company’s strengths and unique values for customers.
Think about it: Target’s goal isn’t to create designer clothing that they can sell for hundreds of dollars per unit. Their strategy is to sell fashionable clothing that everyone can afford. On the other end of the spectrum, designer brands thrive on exclusivity and high prices. Creating a business level strategy means understanding your brand identity and focusing on what you do best.
Most businesses differentiate themselves in at least one of the following categories:
- Cost leadership—providing high-quality products or services at a lower price than competitors
- Product or service differentiation—providing products or experiences that are superior to competitors and inspire brand loyalty.
- Focused differentiation—providing a product that fills a niche need
These differentiators can stand alone or be combined in defining a business level strategy. Companies are most successful when they can highlight the attributes that make them stand out from the competition.
Why Are Business Level Strategies Important?
When it comes to creating a business level strategy, the customer is at the core of the strategy. Unless you know exactly who your customer is, what their needs and wants are, and what kind of experience they prefer, it’s impossible to create an effective business level strategy. Because understanding your customer is foundational to growth and long-term success, creating a business level strategy will not only help you to build an organization based on its strengths and value for customers but also to formulate a road map for the future.
Business level strategies create competitive advantages in today’s challenging markets. Companies without a clear idea of their own identity, strengths, and weaknesses won’t last long and will have trouble responding effectively to market conditions.
Creating a Business Level Strategy
Now that you know why it’s important to create a business level strategy, it’s time to put it down on paper. It’s important to formalize the strategy so you can refer to it whenever you need to. Depending on the size and complexity of your organization, you might have to go quite in-depth when creating and presenting your analysis and strategic plan.
Common components of a business level strategy include:
- A summary
- An introduction
- Analysis of the organization’s strengths in the context of the larger organizational vision
- Information about the ideal customer
- Competitive analysis
- Definition of the unique selling proposition
- Goals and focus projects
- Financial analysis
- Explanation of the key performance indicators (KPI)
Each business will have different needs for its formal business level strategy plan. You should customize your plan based on the size and complexity of your organization and include any relevant information. Your strategy should take as many factors into account as possible so that it can be used to guide future organizational goal-setting and decision-making.
Reach Out to Peers for Review & Feedback
You will have blind spots when you’re creating any type of in-depth business strategy and drafting a business level strategy is no different. It’s important to have your plan reviewed by peers before you put it into action so that you can make any necessary changes before it’s too late.
It’s almost always valuable to get feedback. The best companies are built by many hands working toward the same goal. Don’t be afraid to reach out and have someone review your plan. It’s better to go back to the drawing board now than six months (or six years) down the road.