WHAT ARE EXAMPLES OF BUSINESS STRATEGIES?
A business strategy details an action plan intended to achieve a goal. Different types of businesses have different goals and take different avenues to fulfill those goals. These elements make up the business strategies of these businesses. Business strategies are not the same as business tactics, as a strategy is a plan for the future. However, a tactic is a plan to handle the situation at hand. Since the future is variable, strategies often make assumptions about future business conditions.
The following examples demonstrate various business strategies.
A management team develops a program strategy to outsource several projects to transfer those project risks to the outsourcing partner. The strategy’s goal is a reduction of overall program risks. This program strategy makes assumptions about the outcome of the outsourcing arrangement, such as assuming the outsourcing partner won’t go bankrupt suddenly.
An online retailer could develop a strategy which offers a premium membership for a fee that includes free shipping on all orders. This strategy is designed to improve sales revenue since premium members have an incentive to order more often: free shipping. The particular sales strategy makes assumptions about the future, including future shipping costs and how many orders customers will make when they have unlimited free shipping.
A delivery business develops a strategy to convert its entire fleet of vehicles to electric. Reducing energy costs and improving the sustainability of the company’s operations are the goals of this sustainability strategy. The strategy makes assumptions about the electricity grid and solar panel costs in the future.
A company that publishes textbooks develops a marketing strategy to offer several free apps for electronic devices. The publisher understands that college textbooks are a high price item and is banking on the plan that the free apps will improve relationships with customers. This particular marketing strategy relies on forecasts that the apps will be popular with their customers.
Human Resources Strategy
- A human resources department develops an HR strategy to improve employee performance reviews by requiring managers to get feedback from their teams. The goal of this HR strategy is to reduce occurrences of toxic management behavior resulting in low staff morale and unwanted legal costs. This strategy assumes that staff who have a toxic manager would have the courage to criticize the manager in a formal review process.
Information Technology Strategy
A credit union develops an IT strategy to use multi-factor authentication for all its customer-accessible systems. Reducing costly security and fraud incidents are the goals of this IT strategy. This strategy assumes that the chosen methods of multi-factor authentication will be effective against security threats in the future.
Without a strategy, a business objective is just a dream. Entering the market with a poorly planned strategy is a gamble as well. With competition ever-increasing, the importance of business strategy is undeniable. If you need help devising your strategy for success, contact a business consultant in your local area for advice on creating a strategy.