Defining Strategy
There are a lot of different definitions of strategy. Go ahead and search the internet–you will find an endless list of strategy definitions. Some of them are similar to one another, while others are wildly differently. My abbreviated definition of strategy is the alignment of actions with objectives. Building on this abbreviated definition, I propose every viable definition of strategy must include at least four basic components.
Surely there are many ways to discuss the formation and implementation of a strategy, but at some level every approach involves these four basic components. And it’s an informative exercise to try to separately analysize each of these components before aggregating a comprehensive strategy.
A Plan
Strategy is seldom discussed without an accompanying discussion of tactics. Tactics refer to the specific steps in the plan. Obviously, these steps only contribute value to the overall strategy when they are first informed by the other three strategic components. Additionally, in some instances the order and timing of these steps can contribute further value by reinforcing the effective deployment of resources or acquisition of advantage.
Deployment of Resources
The first step to deploying resources is to define which resources are available. Often, companies create plans that don’t utilize all the resources available to it. At the other end of the spectrum, some visionary companies try to plan deployment of resources that are not within their control. To some extent that may be possible where resources are available for temporary use or through acquisition or leverage.
Advantage
Sometimes gaining advantage is inherently performed in the deployment of resources. For example, the use of money and technical knowledge to obtain a patent results in inherent value commensurate with the strength of the patent. In other circumstances, advantage is gained through key positioning with partners, suppliers, influential legislation, or even through innovative reliance on internal skillsets. In any case, it’s important to define the advantage sought and the metrics that can be used to measure the advantage within the appropriate competitive environment.
Competitive Environment
No company operates in a vacuum. Nevertheless, many “strategies” are developed in a vacuum. The movement toward lean startup practices have tried to combat this type of purposefully blinded approach. And thankfully, more and more companies are informing themselves of the competitive environment they’re working within so that the rest of the strategic components are more meaningfully developed and deployed.
Where all four components of strategy are substantively present, meaning each component of the strategy contributes to the overall thrust of the strategy, the strategy could be considered more “strategic.” In contrast, to the extent that one or more of these four components are only superficially present, a strategy could be considered less “strategic.”
Let me know if you think these four components cover your definition of strategy.
[This post was originally published April 5, 2017, on LinkedIn by Jeff Holman.]
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