The formation of any strategy starts with a vision – a desired future state. It’s where you want to get to, and your strategy focuses on the alternative routes and choices you can make to get there. Having a robust strategy, informed by market insight, keeps you focused on your vision and increases your chances of success.
It’s not that simple of course, because competition is evolving and changing all the time, so you are constantly in pursuit of achieving differentiation and competitive advantage to enable you to achieve sustained superior performance. The environment around us is constantly changing so whilst strategy is directional in nature, the plan to be followed to achieve your goals and ambitions should never be set in stone.
There are different schools of thought about how to create competitive advantage. Michael Porter (amongst others) advocates that businesses should analyse their industry and ‘fit’ within it and then develop differentiation in order to achieve competitive advantage. Conversely, in their famous book ‘Blue Ocean Strategy’ Kim and Mauborgne advocate businesses should create uncontested market space and make the competition irrelevant.
In reality, even if a new market space can be created, competitors will typically follow, so differentiation and relevance still need to be continually developed as the environment changes.
That high level summary of strategy theories effectively leaves us back where we started: we need a vision, a strategy, and a flexible plan. So how do you go about putting these in place?
The best place to start is with a thorough and honest critique of the current situation. Fundamentally, understand what the business exists to do and what it must do to survive. Then, as outlined in part 1 of this series, you need to understand your market in the context of competitors and current / emergent customer needs and trends.
Once you do, you can use insight to develop a future vision (e.g. 3-5 years) that stretches beyond the current business and competences. There will be different ways to achieve that vision, so it’s important to identify the overall goal and then debate and agree which strategies to adopt. Once you’ve done this you can prioritise the strategies and the critical enablers, develop a framework with clear milestones and KPIs, and then align the business functions and culture to the strategic plan.
We have a simple and sequential four-stage model at the heart of the way we approach all our work at Whitecap:
1. Corporate strategy
2. Business strategy
3. Brand strategy
4. Marketing strategy
Our belief is simply that these things must be aligned effectively. Ideally start with the end in mind, or start with current marketing activity – it doesn’t matter; but alignment is critical.
In a business perspective, the ‘end’ will be defined by your corporate strategy, which in the vast majority of cases is to sell the business. In order to achieve this goal, you need a business strategy that outlines the way you will do business. After that, you can define your brand in line with your corporate and business goals.
Once you’ve done all of this, and not before, you can put in place a marketing strategy that can realistically be expected to help your business succeed.
Case study: Vodafone
Vodafone provides a really good example of how its overall corporate goal is reflected in its strategy and plans, and specifically in its marketing strategy.
Vodafone’s vision and corporate goal is to become one of the world’s top ten brands. To achieve this, it requires a strong global presence, and it strives to achieve this with a particular focus on products and customers, and it’s brand and marketing.
Vodafone is already the market leader in the UK and in many of the other markets in which it operates. It looks to position itself as a leader by sponsoring leading sporting brands including Ferrari and Manchester United.
Sponsoring these leaders correlates directly to Vodafone’s corporate and brand strategies, and supports the goal of making the company one of the world’s best known brands.
Vodafone has over 100 million customers worldwide, spanning five continents and 28 countries. Formula 1 has a worldwide television audience of 360 million people for each race.
To stay ahead of the field Vodafone continually seeks to bring new technologies to the market. Vodafone’s business strategy is customer focused and product led; the company is continually developing new products and services which utilise the latest technological advances.
The firm’s marketing strategy is a key part of its overall corporate strategy, and is concerned with developing plans for finding out what customers want and then communicating/engaging with them to ensure they know Vodafone is striving to meet their requirements.
There is a clear link that flows through Vodafone’s corporate, business, brand and marketing strategies. This can only be achieved with complete clarity of overall strategy and vision.
6 key strategy and planning questions to ask yourself:
- Are your company aims and ambitions clear and documented?
- Has your company strategy been produced using a robust approach?
- Is your company strategy regularly and formally reviewed and updated?
- Does you company strategy inform the annual business plans & priorities?
- Does your company strike the right balance between short, medium and longer term planning?
- In which areas is your company strategy particularly strong or weak?
These questions are mirrored within our Strategy Survey, a free tool also available on our website.
This blog is the second in a set of four in Whitecap’s Strategy Series, published in November/December 2013.