If we collected information on the literature directed at management and strategic direction, we would find that the word strategy is the most used, the most approached and from which many theories, controversies, schemes, congresses and exhibitions have been produced.
If I asked you what you mean by strategy, you would surely answer me the following:
- It is usually used to create a competitive advantage in the short or long term depending on the strategic projection of the company It is used to create image and brand construction Path of the organization Adaptation to the change of the environment Fulfillment of goals and objectives
All these indicated guidelines are built through a strategic course that makes up 4 essential stages:
- Strategic analysis: Understanding the current situation of companies. Strategic planning: That is, the selection of courses of action to follow to achieve the purposes. The strategic implementation: The process of making the different actions foreseen in the plans. Strategic control: The set of adjustments and corrections to be made during the implementation process to stay on track.
Graph 1. Strategic nature
| Strategic analysis | Strategic planning |
| Strategic implementation | Strategic control |
But what about companies? Do you have a clear concept of the strategy? Its leaders, who determine the daily maneuvering of organizations, are lost in the face of such turbulence, persistent changes in the international economy and a threatening growth of an increasingly harmful globalization at a global level, that it is difficult for them to carry out an exhaustive analysis. strategic of the organization.
The strategy is not directly determined by the option that senior management decides, it is not just about opting for differentiation or cost leadership, hybrid or value-added strategy, it has a much more complex scope.
Just as in the military field, the strategy is based according to the military power that a country has, the same happens with companies, the strategy is always based on the resources that the company has and that it can really face the goals and guidelines delineated in the time you think necessary to achieve the desired objective.
There are several levels of strategies
The first is what is known as corporate strategy, it involves those decisions that will reach the entire company, it is generally concentrated in the top management and its main purpose is to create and maintain a balance of business portfolio. At this level, the mission, vision and general policies for the development of the organization are established.
Competitive strategy: These are those decisions specific to each business unit. Its purpose is to create and maintain a position against the competition, its main functions are: Competitive approach, expansion actions, attacks and defenses against the competition.
And finally, the functional strategy is the one that is classified for each business unit in particular whose purpose is to provide operational support for each area of the company.
The strategy itself has to be seen not as an imaginary paradigm, but embodied in reality with actions that its employees make that strategy consider alive with the highest level of coherence and consistency between decision levels.
On the field of war, when the commander issues orders, the soldiers know what strategy they are going to use to achieve the goal, if they have to attack from the rear, if they are going to do so from a weak flank or a frontal battle. What if the soldiers did not know what to do when they were in battle? Perhaps, each soldier would simply think independently and do something different, like shooting at close range to kill anyone and thus preserve their life. Would it really be the desired result? Surprisingly, some companies operate in this way, when they do not plan their strategy or simply leave it to chance.
The deliberate strategy is generally not put into practice except for rare exceptions, it usually happens that certain companies take the wrong path or lose their strategy. The reality indicates that companies must have a clear skill to know if their strategy is adequate or not. It is like driving on a route that does not take us to the place we want and not having the slightest idea if the path we are taking is the right one. The idea then is to have a practical guide to strategic indexes that can be seen and quantified on a daily basis.
In order to put a strategy into practice, you must know what real resources you have. The strategy is tied directly to resources since there are strategic constraints to implement. If a company tries to position itself as a leader and does not have the resources to achieve it, it will not be able to do so and have the best strategy to implement or have great potential in its employees.
Suppose that a company wants to enter the beverage market, but does not have an appropriate infrastructure or does not have a strong image in the market, it would be foolish to want to position itself as a leader or as a challenger in the market when it does not have the resources to face that challenge.
A company would be able to opt for a penetration strategy income with low prices to join a market niche and position itself as such, is what the Vaneduc group did, a family business that was in the educational market since 1960, its diversification made them expand towards the creation of a university. But how to compete in a market that is very competitive and where it is difficult to position yourself?
The strategy consisted of low prices and good educational quality, but its core strategy was a mix of viral word-of-mouth marketing and low price penetration. The recommendations of teachers to students and from these to others made a strong growth in the university that opened offices in different parts of the country, the growth was profitable so it was strongly positioned in its niche, thus creating a strong corporate image.
The strategies can be maintained over a period of time. This is what is known as a “ linear strategy ” that will depend on the market where it operates, if it is unstable or not, if it is attractive enough to attract investments, the instability it has, the type of turbulence and the existing competitive strength.
There are variables that make a company can modify its strategy, it is what is known as " incremental strategy ", when a company sees its strategy at risk or the market where it operates becomes unstable, it opts to alter it and in this way it becomes a new strategy, transformed and adapted to change.
The very nature of strategy is built on resources and strategic innovation. The reality of the strategy itself then depends on two factors:
- Organizational resources Strategic innovation
Both factors go hand in hand, the success of the same does not depend on each separate variable, but combined with each other. Both innovation and the resources that the company possesses are the 2 key success factors. But these controllable variables only meet 50% success in favor, the remaining 50% will depend on the environment.
Therefore, all these factors are relative in terms of the efficiency of the implementation of the strategy.
Even so with an unforeseen environment, many companies seek to grow, but how to achieve it in the face of uncertain instability in the environment? What kinds of strategies and tactics are needed to know in order to be successful, we will list the existing orthodox typology below.
Elimination of strategic impositions:
This model can be an organizing principle and of good results.
The impositions are concessions that customers have no other choice or option to make or accept respectively, let's see an example, a garage forces a customer to leave their car for at least three hours, even if they stay an hour or two hours, the price does not it's going to vary, it's going to be the same.
Therefore the impositions are the one of this way or not at all, usually the clients determine that the sector is right and accept the payment that they have to face.
Henry Ford did the same in the automotive industry, his customers could not choose to choose a color of the car to buy, with his famous motto any customer can decide the color of his car he wants as long as it is black, determines a strategic imposition.
Probably some of the best imposition removal ideas were by Forum.
General Motors offered the customer's free choice of color, what would have happened if Ford had not adjusted to the changing environment or eliminated this imposition?
Today we see that the automotive industry has changed, they not only offer colors, but also the type of car that the customer wants, whether five doors or three doors.
Despite all kinds of options or innovations to eliminate all kinds of restrictions or impositions in the right circumstances has a lot of power for an organization to grow, you have to think like customers and not as executive directors to be able to find and take advantage of the impositions to achieve a fast increase and good profits.
Value innovation:
We have a conjuncture of a conventional strategy and that of value innovation, both differ in the basic and complex dimensions of the strategy.
The conventional strategy is based on the conditions that prevail in the environment as impossible to change, they let the competition establish the parameters of their strategic thinking, the innovation of strategic value does not use the environment or its reference rivals.
It seeks the common interests of customers.
Let's see the following table the differences of the two strategic logics:
| Conventional logic | Value innovation logic | |
| Acceptances
of the sector |
The rules and conditions are unalterable | It is possible to modify the conditions of the sector |
| The clients | The increase in customers is based on good segmentation and diversification
of the company in the market |
It focuses on the key aspects of the customers in common, whatever they are. |
| Advantages and capabilities | Every company must make the most of its competitive advantages | A company cannot limit itself to what it owns, it must ask itself, how can we continue to grow? |
| Strategic approach | The goal is to beat the competition | Competitors are not the benchmark, you must create value to win. |
This type of strategy based on value innovation, establishes growth planning, benefits in an economy of fixed changes that allows us to analyze the restructuring that is needed to change the paradigm and leave the structure that encloses us and does not allow us to see where modern business is headed.
Growth through the acquisition of companies:
Many companies opted for growth in this way, buying companies of different types of businesses and operating as a Holding.
The competitive advantages that a company can obtain by opting for this type of strategy are based on the following:
- Increased intellectual capital Liquidity Increased assets Increased customer acquisition and new segments to operate Obtaining new brands Cost reduction
But when one examines the cultural aspect, it turns out that it is the most important thing to take into account.
Suppose that General Electric incorporates a new company, it must be known that the integration does not end after the agreement is consummated but quite the opposite since it is a previous step, because of this statement it has its roots in the illustrative aspect since cultural assumptions and adaptive capacity must be adapted.
This is something that managers are often unconcerned and do not take into account when analyzing the results and the lack of ability to respond to demanding customer concerns.
For an integration to be successful, it must merge not only the various technical aspects of the business, but also the differing cultures, what then is the best way to achieve it? Employees will have to work together as soon as possible to solve company problems and achieve results that could not be achieved before.
As we have seen in this orthodox growth topology, the central strategies seen in this work are the coordinators for a company to function efficiently, needless to say that there are articles, books and theories of various topologies, in my opinion the orthodox is the most effective in implementation.
The other virtual type topology also covers the increase in productivity and economic growth of organizations, but we would have to analyze the virtual chain, supplementary services and strategic diversification, which is not the interest of this article.
Throughout all of the above we have seen all the incidence that the determination of a strategy causes in the direction of a company, and its axiomatic results, since the useful life of an organization depends on several factors, but the strategy is without place Undoubtedly the motor nerve of a company for survival in the changing world of business, to say goodbye I would be delighted to do so with a famous phrase from the Author Gay Hamel
"Strategy is not everything, but it is the most important"
If you wish to contact the author to exchange ideas, opinions, comments on this or other works previously exposed, I can do so by writing to: e-mail: [email protected]
