Why & when do you need a business strategy?
Without a solid business strategy, you’re navigating in the dark.
The goal of a business strategy is twofold. It will:
- Set you on a clear path, giving you the best chance of achieving your goals
- Create clarity, alignment, and inspiration for your team, as well as for your customers and investors
When you’re small, it’s fine to keep strategy notes in a text editor. If you have grown beyond 5-10 people, however, your strategy should evolve with your team. As your business grows and scales, you should create a presentation that will ensure greater alignment and consistency within your team.
This leads us to another common question: When should I develop, or even rework, my business strategy?
While your initial business strategy should be roughly developed before you launch, it’s not set in stone. In fact, your strategy should be updated every time it falls short, or whenever you feel as though it no longer serves you.
Have you recently learned something big about your business or industry? Have there been major changes in your industry lately? If there have, it may be time for a change.
Not only that, but to remain up-to-date it’s recommended that you review and refresh your strategy at least once a year. This will ensure your company stays relevant and competitive, and that your business strategy will remain fresh in your team members’ minds.
Now that we know the why, it’s time to address the how.
Research, research, and research some more
How you develop your strategy will mainly be based on the research available to you.
When developing your strategy, you should get input from your team, as well as your customers and advisors. Before putting pen to paper, you should also consider internal reviews and public data.
It’s recommended that you develop an initial hypothesis to direct your thinking. However, be prepared to let go of your hypothesis if your research begins to point you in a different direction. After all, that’s the purpose of the research you conduct–to either confirm or disprove your theory and find the best possible direction.
Here are some areas to explore during your research:
- Which product or service offerings does most of your revenue come from today?
- Who are your biggest customers? What commonalities do they have between them?
- What are your competitors doing? How are you different? What are your substitutes?
- What is the overall market doing? What is changing in adjacent markets? Are there emerging technologies that make new things possible?
- What feedback have you received? Where are you doing well, and where are you falling short?
In addition, be sure to:
- Talk to your team. What do they see day-to-day? What ideas do they have?
- Interview your best customers. Why do they need you? Why do they work with you vs. your competitors? Where can you do better?
- Interview customers who left. Why did they initially work with you? Why did they leave? What have they replaced you with?
- Review your current/past strategies. What went well? Where did you diverge? Which lessons should you apply to your next strategy?
A clear strategy structure
During your research and beyond, consider your core strategy structure. It should be simple, coherent, and logical.
For example, the following structure is something that can be easily communicated and understood on a single slide. It works well and can automatically serve as a cheat sheet for your team.
Regardless of which format you use, though, a core strategy requires the following components:
- Mission: Why your company or team exists
- Vision: What impact your company will have in 5-10 years. To put it another way, what is your overall goal/what ultimate milestone do you aim to reach?
- Strategic vision: The impact you want to have in 1-2 years
- Strategic objectives: How you will achieve the strategic vision
- Tactics: How you will achieve the strategic objectives
For the first written version of the strategy, a two page strategy document often works best.
- Page one: A summary of the key learnings from the research
- Page two: A summary of the strategy
Once you have completed this, get a first round of feedback from a few team members and advisors and adjust accordingly.
The strategy deck
Now that you have created your core strategy, it’s time to build out the full story to support the direction of your business strategy. This is your primary communication tool for building alignment among your team and investors.
For a 5-50 person startup, a ~15 page deck will do the job. Here are the pages it should include:
- Executive summary: Short summary of the key points of the deck
- Context: Where is the business at today? What is going on in the industry today?
- Market: Size, makeup, growth
- Competition: Who are your greatest competitors?
- Problem statement: What is the problem you solve?
- Value proposition: How do you solve the problem?
- Mission & vision statement
- Strategic objectives
- Tactics: Use one slide for each strategic objective
- Metrics/KPIs: The measurable values that provide business insight
- Implementation plan
- Financial plan
- Appendix: Include any relevant backup and supporting materials
Once you have your first draft, get feedback from a wider group of your team and advisors. At this stage, you should still be open to adjusting the strategy based on the feedback you receive.
As feedback starts to converge, you’ll want to refine and polish the document. This will enhance its impact when shared with key stakeholders. We recommend getting professional design help for a document as important as this (see how SketchDeck can help with this).
With a polished strategy in hand, you’re now ready to roll it out.
Next steps: Turning slides into actions
You now have a strategy for your organization–congratulations!
However, keep in mind that a strategy can only have impact if it’s followed. We will cover how to do this in a future article, but for now, here’s a brief overview of the steps you need to take to turn the slides into action:
- Communicate the strategy, making relevant to each team
- Create plans and set goals aligned to the strategy
- Measure progress
- Repeat communication, celebrate wins and examine shortfalls
- Critically review and adjust course each year
Your strategy deck is an important document. Good design will help communicate the ideas in a clearer and more compelling way, and SketchDeck can help.