Business strategy includes the topics of corporate strategy, marketing and brand strategy, sales strategy, as well other areas of strategic thinking. When we speak about growth strategy, we include both normal business growth and inorganic growth, namely M&A. Marketing strategy and sales strategy are usually discussed in unity, but are completely different in nature. Business strategy is often conducted during a bi-annual strategic planning environment, usually conducted in a 2 day remote location with management and key personnel, both within and outside the organization. Marketing strategy includes branding strategy, go-to-market strategy, and Internet strategy. Sales strategy includes distribution strategy, distribution strategy, and business development.
Growth can be achieved several ways, which fall under the two buckets of growing business scope and growing the value from the existing revenue streams. To increase the value from the existing business, a company can better its value proposition, strengthen customer relationships, optimize pricing, penetrate new markets with their existing services, and optimize its mix of products. To expand the business operations, a business can branch off into new segments, expand into new categories, create new products, launch new brands, create new formats and distribution channels, and expand geographically.
A common business problem many business strategies aim to solve is the challenge of creating sustainable growth. Furthermore, real revenue growth is much less stable than ROIC ranging from 1% to 11%. The fact is that most companies experience difficulty achieving significant growth, year over year. Companies achieving greater than 20% sales growth almost always dwindle down to 8% within 10 years. Between the 1960s and 2010, Fortune 500 companies experience a median growth rate of in less than 6% in real terms (and under 10% in nominal terms). For those companies that do achieve significant growth rates, these growth rates also decay quickly. Only about a third of the Fortune 500 companies are able to sustain top-line growth above the national GDP and generate returns above the Standard & Poors 500. Also, 90% of them are concentrated across the 4 sectors of Financial Services, Life Sciences, Technology, and Retail & Distribution. In particular, enterprise companies find it difficult grow.
Any great management consulting has a toolbox of classic and modern business strategies. Consulting firms and consultants utilize these strategies to address, evaluate, and solve a number of different types of business problems, which occur in different business situations. Over the past 50 years, top consultancies, including McKinsey and BCG, have come up with strategies that are widely used in the corporate world today. Many such frameworks and business notions hinge on the seminal teachings of Michael Porter, the originator of contemporary business strategy.
Learning how to write a business case requires a number of critical activities. A bottoms-up benefit case must be created and analyzed and a business case should be developed for financial benefits tracking. Usually, creating a business case includes conducting targeted interviews , analyzing the company?s financial reports, developing the business case financial analysis, and creating a top-down business case template. The financial analysis involved includes financial reporting, ratio analysis, DuPont Analysis, stakeholder value analysis, and rudimentary sensitivity analyses.
business strategy development