Company development strategy. Military strategies - games that develop logical thinking

An enterprise development strategy is a powerful tool for promoting any business. In simple words, this is a plan according to which the process of achieving production goals takes place, the implementation of all established plans and wishes regarding the development of the company, and so on. Thanks to promotion tools and strategy, it becomes possible to adapt the business structure to the environment of market conditions.

Every business needs an enterprise development strategy no less than financing, since without the involvement of third-party tools it is extremely difficult to “keep up with the times.”

The adequacy of the chosen strategy depends on the qualifications of the planning team. The more effort invested in the planning stage, the more accurate the necessary tools will be to implement the development strategy. Planning the long-term activities of a company and forecasting possible results directly affects the choice of an enterprise development strategy.

The choice of strategy is always subject to careful preparation. A detailed study of external market factors and the company’s target activities will make it possible to select the most effective strategy, and at the same time it will be easier to implement all the steps planned during planning to promote the business and strengthen its position in popular flows. The above-mentioned external factors are also commonly called the environment.

What is the external environment?

The totality of all processes of the company, and beyond, which include:

the general position of the company's products or services in the market of popular groups.

The general position of products or services, the release of which is possible instead of the company’s target activities.

The solvency of the entire population, as well as among the audience of the company’s activities.

Possible changes in the solvency and purchasing factor of the entire population, as well as the company’s target product.

Geographical location that influences the demand for the company’s key products.

Political and geopolitical conditions in the country as a whole.

Generally accepted rules of the hierarchical chain, its regulations, etc.

Prospects for the country's development, its strategies, as well as plans for implementing strategies.

All these points are key to understanding the external environment. The vast majority of information does not require a long search, since all the data is in plain sight, but all this requires careful analysis. The opinion of experts is that there is no particular effectiveness from analyzing data collected only according to the reports of their own departments. To gain a clearer understanding of the company’s position before choosing a strategy, you should resort to an internal audit of the entire segment of the selected strategy perspective.

In essence, the choice of strategy can be called forecasting and planning. When forecasting the development activities of a company, region, state, or the entire human population, you see before you many possible development scenarios. Having decided on the choice of the desired scenario, you will choose the necessary strategy at the same time.

Types of development strategies

Types of enterprise development strategy include targeted activities regarding the implementation of generally accepted company tasks.

Directions are aimed at:

Growth strategy;

Limited growth strategy;

Industry development strategy;

Reduction strategy;

Elimination strategy;

Mixed strategies;

Product development strategy.

Larger companies differ from the generally accepted development strategy. This lies in the fact that companies with a large number of divisions do not exclude the possibility of forming additional strategies. What does it look like? According to the structuring of the company's industries, it is possible to form a strategy for a specific type of activity. All additional strategies may differ from the idea of ​​the general development plan of the company, and sometimes even have objectives that are opposite to it.

Varieties of additional strategies

Listed below are the development strategies for an enterprise with a large number of branches.:

Differentiated strategy. It consists of providing the market with products that have not previously been produced from this production.

Strategy of absolutism (absolute leadership). A massive attack on the market by reducing prices for their products, promotions, etc.

Focus strategy. The goal is to attract the market to a particular product in its segment.

For the most part, large companies prefer to use mixed strategy tools. Mixed means a combination of several strategies, which are listed below.

Progressive, due to which the enterprise grows in the industry of forming connecting links between production and the buyer.

Regressive when a company grows by turning to new suppliers of raw materials and introducing new resources into its activities.

Horizontal, tough takeover campaigns of competitive companies similar in type of activity.

Risk factor when choosing a strategy

Making a decision on choosing a company's development strategy is associated with some risks, since we are talking about forecasting. At its core, a forecast is just markers along which reality moves, represented by real events. It is impossible to make an absolutely accurate forecast, and therefore there are risks. Experienced specialists in the field of forecasting can somewhat narrow the range of movements of the expected events, but even their efforts cannot achieve an accurate version.

Listed below are a number of risks that you may encounter when looking for the right strategy for your business.

Complete absence of growth restrictions; These strategies can only be adopted for short time periods. The risk lies in the possible rapid change of production activities and the filling of high positions in the in-demand market with a new product. The last point on the path to reducing the speed of development for this strategy is stagnation.

Risk of reduction; lies in the possible deprivation of strategically important structures, production technologies, development vector, share of the assortment, etc. Caused by an incorrectly drawn up forecast, or other circumstances.

Liquidation is the most common risk among incorrect forecasts. On the one hand, there are no risks, since the company has been liquidated. But if the reason for the liquidation of your company was a forecast that was not prepared properly, this is fraught with serious financial losses for all shareholders and co-founders. Moreover, the loss is not the most pleasant, since in fact you are losing an entire company due to the mistake of the team that made the forecast.

The issue of solving problems associated with risk and minimizing them has troubled the inquisitive minds of many scientists since the advent of the first industrial production. However, several centuries ago a solution to the problem was found. The wonderful theory was to avoid risks by making a detailed plan.

The theory developed through various planning models. Those who resorted to a continuous planning model achieved greater efficiency.

Among the generally accepted planning models are:

strategic;

long-term;

Medium term;

Short term.

Continuous planning is the constant application of short-term plans. As an example, this is the preparation of plans for an annual period, which are carried out every month. It doesn’t have to be exactly a year, everything depends on the results that arise during the implementation of the plan.

Unfortunately for small businesses, this model is only available to large companies, but small firms effectively use calendar planning in their arsenal.

Principles of strategy development

Developing an enterprise development strategy includes a step-by-step principle for creating an effective tool for promoting the company. Since this issue is serious and requires careful processing, it consists of several steps, which are listed below.

Initially, the target mission of the enterprise is determined, subject to the implementation of the intended development strategy. The mission refers to the general position of the company in society, its role for the consumer market. Development of a development strategy using the example of defining a mission as meeting the emerging demand in a particular area of ​​activity.

Then attention falls on the hierarchy of tasks solved by the strategy. These tasks may be:

Formation of a new image of the enterprise;

creation of target and counting cards of indicative data;

Thinking through an implementation plan based on the presented planning models;

Formation of a schedule of actions to implement the strategy.

After which a component of the strategy is formed:

Understanding the advantages and disadvantages of the company at the stage it is at before applying the development strategy;

Collection of data on possible risks;

The vicissitudes of opportunities and risks in the current situation of the company;

Drawing up a graphic table indicating the solution according to the principle “on the left is bad, on the right is good.” That is, indicating a solution to a disadvantage by introducing some advantage or new opportunity.

Drawing up a hierarchy of assigned tasks;

Collecting detailed data on a possible solution to each problem and entering it into a table;

Determining those responsible for implementing the plan.

Finally, a team of experts begins working to put the strategy into action. The group of responsible persons is limited by the regulations of the strategy and the period for its implementation.

The stages of developing a company's financial strategy alternate as follows::

1. Development of methods for assessing external and internal factors for subsequent analysis of collected data and comparison. A template is drawn up, the work of which is distributed among all group members.
2. Opportunities for business development and risks in the external environment are assessed.
3. A kind of planning meeting. On the agenda is an assessment of company factors that may contribute to or hinder further business development. Analytical data leads to the formation of a unified position.
4. Search for connections in inverse ratio pairs using the plus-minus principle.
5. Search for connections among strengths and possible risks.
6. The appearance of a table with possible scenario solutions, the construction of a template based on which an expert assessment will be made.
7. Forecasting possible fluctuations in the internal component of the company, depending on the adoption of one or another strategy scenario.
8. A planning meeting on the work done, upcoming further actions, group analysis of the changed position of the company or its products in connection with the accepted scenario.
9. Setting deadlines for the implementation of selected solutions. Hierarchical development map.
Forward →

The definition of strategy for a company fundamentally depends on the specific situation in which it finds itself. In particular, this concerns how the firm's management perceives various market opportunities, what strengths of its potential the firm intends to use, what traditions in the field of strategic decisions exist in the firm, etc. In fact, we can say that as many firms exist, there are just as many specific strategies. However, this does not mean that it is impossible to carry out some typology of management strategies. An analysis of the practice of choosing strategies shows that there are common approaches to formulating strategy and a general framework into which strategies fit.

As mentioned earlier, in its most general form, strategy is the general direction of action of an organization, the adherence to which in the long term should lead it to its goal. This understanding of strategy is valid only when considering it at the top level of management of an organization. For a level lower in the organizational hierarchy, the upper-level strategy becomes a goal, although for a higher level it was a means. So, for example, market behavior strategies developed for the company as a whole act as targets for the marketing service of this company. To avoid ambiguity in the interpretation of strategies, later in this chapter only the strategies of the organization as a whole will be considered, and not of its individual units.

When determining a company's strategy, management is faced with three main issues related to the company's position in the market:

Which business to stop;

What business to continue;

Which business to go into?

At the same time, attention is focused on:

What the organization does and does not do;

What is more important and what is less important in the activities carried out by the organization.

Approaches to strategy development

According to one of the leading theorists and specialists in the field of strategic management, M. Porter, there are three main approaches to developing a strategy for a company’s behavior in the market (Porter, chapter 2).

The first approach is related to leadership in cost minimization. production. This type of strategy is associated with the fact that the company achieves the lowest costs of production and sales of its products. As a result, it can achieve a larger market share through lower prices for similar products. Firms implementing this type of strategy must have good production and supply organization, good technology and engineering capabilities, and a good product distribution system. In order to achieve the lowest costs, everything that is related to the cost of production and its reduction must be carried out at a high level of execution. Marketing with this strategy does not necessarily have to be highly developed.

The second approach to strategy development is related to specialization in production. In this case, the company must carry out highly specialized production and quality marketing in order to become a leader in its field. This leads to the fact that buyers choose the products of this company, even if the price is quite high. Firms implementing this type of strategy must have a high R&D capacity, excellent designers, an excellent system for ensuring high quality products, and a developed marketing system.

The third approach refers to fixation of a certain market segment and concentration of efforts firms in the selected market segment. In this case, the company thoroughly determines the needs of a certain market segment for a certain type of product. In this case, the company may strive to reduce costs or pursue a policy of specialization in the production of the product. It is also possible to combine these two approaches. However, what is absolutely mandatory for carrying out a strategy of the third type is that the company must base its activities primarily on an analysis of the needs of customers in a certain market segment. That is, it should base its intentions not on the needs of the market in general, but on the needs of very specific or even specific clients.

Let's consider some of the most common business development strategies, verified by practice and widely covered in the literature (see, for example, Kotler, pp. 58-59). These strategies are usually called basic, or reference. They reflect four different approaches to the growth of a company and are associated with a change in the state of one or more elements: 1) product; 2) market; 3) industry; 4) the position of the company within the industry; 5) technology. Each of these five elements can be in one of two states: an existing state or a new one. For example, in relation to a product, this could be either a decision to produce the same product or to move to the production of a new product.

Concentrated Growth Strategies

The first group of reference strategies consists of the so-called concentrated growth strategies. This includes those strategies that are associated with changes in the product and (or) market and do not affect the other three elements. When following these strategies, a firm tries to improve its product or start producing a new one without changing its industry. As for the market, the company is looking for opportunities to improve its position in the existing market or move to a new market.

The specific types of strategies of the first group are the following:

strategy to strengthen market position, in which the company does everything to win the best position with a given product in a given market. This type of strategy requires a lot of marketing effort to implement. There may also be attempts to implement so-called horizontal integration, in which the company tries to establish control over its competitors;

market development strategy, which consists in searching for new markets for an already produced product;

product development strategy, which involves solving the problem of growth through the production of a new product that will be sold on a market already developed by the company.

In business practice

The world leader in the production of soft drinks, Coca-Cola, despite its gigantic size, continues to develop intensively, investing huge amounts of money in expanding its potential. IN 1996 The company made investments in the amount of 1,5 billion dollars. It has never made such large investments in its entire more than hundred-year history. A significant part of these investments were made in Russia, for the potential market of which Coca-Cola is in fierce competition with Pepsico, which has been operating in Russia since the early 70s.

Having arrived in Russia significantly later than Pepsico, Coca-Cola, realizing that it had a slightly worse position compared to its competitor, began intensive efforts to create a production base. In April 1994 she commissioned a bottling plant in Moscow, the construction of which cost her 65 million dollars Following this in December 1995 the plant was put into operation in Pulkovo near St. Petersburg, the construction of which cost 40 million dollars. Having secured a production base in the area of ​​the largest Russian cities, Coca-Cola turned its attention to other regions of Russia. TO1998 Coca-Cola plans to increase the total volume of investments in Russia to 500 million dollars

Coca-Cola considers Siberia as one of the most attractive areas for business development. IN 1995 she tried to obtain the consent of the largest beverage manufacturer in Siberia, the Novosibirsk company VINAP, to begin joint activities. But PepsiCo, which became a strategic partner of VINAP, lost. However, this did not stop the Coca-Cola company. She began construction of a plant in Krasnoyarsk. In addition, Coca-Cola plans to build its factories in other cities of Siberia.

Along with the construction of a plant in Krasnoyarsk, the Coca-Cola company began creating a distribution network in Siberia - distribution centers in a number of cities. It is also planned to create a beverage transportation system that will take into account the characteristics of the region. In particular, such a specific type of transport as river transport will be used to deliver goods.

Dmitry Sirotkin, IKF "ALT"

The article discusses a number of methodological issues that arise at different stages of developing a company's strategy. The emphasis is on generalizing the practice of projects for developing the strategy of the consulting company "ALT", and not on presenting general theoretical approaches to developing an organization's strategy.

When considering approaches to developing an organization's strategy, we rely on examples from the practice of various organizations - both industry holdings and companies from the non-production sector. This allows us to provide an overview of the main features of the process of developing an enterprise development strategy, common to enterprises from different industries. Industry specifics should be reflected in the goals and substantive issues addressed at each stage of the strategic process in a particular organization.

When they talk about a strategic development plan, it is assumed that the company will not just continue to carry out operational activities, but will develop, that is, carry out qualitative changes in its activities. For example: an equipment manufacturing company is developing a service network; the distribution company is actively developing its logistics business; a successfully operating restaurant is replicated as a network project. As a rule, strategic decisions are driven by active changes in the industry market.

It is important that these changes occur in a controlled manner. If we continue the example with a restaurant chain, it is necessary to plan how many restaurants will open during the period of implementation of the strategy, what financial and human resources will be required, etc.

It is most advisable to begin developing a strategy if there are external or internal incentives for the further development of the company. Let's assume that the owner decides not to create a chain, but simply to maintain the restaurant in good condition and continue to make a profit. In this case, there is no need to develop a company strategy; it is enough to prepare a medium-term financial plan. But if a couple of competing restaurants open nearby, then this modest goal of the owner will turn into a difficult strategic task, which is unlikely to be solved without any qualitative changes.

Specifics of strategy development for companies included in the holding

Unfortunately, there is no unambiguous scheme for the distribution of functions between the subsidiary and parent companies of the holding when developing a strategy. The range of options is wide and depends primarily on the holding management model. For example, if the purchasing and sales functions are transferred to the parent company, then the subsidiary may simply not need a separate strategy.

It should be noted that usually the parent company of an industry holding is more deeply involved in the development of the subsidiary’s strategy than the parent company of a diversified holding.

Typically, the parent company takes on the following functions when developing the subsidiary's strategy:

• General development methodology and standard structure of strategy description. This ensures comparability of the subsidiaries’ strategies and simplifies the task of combining these strategies into an overall corporate strategy
• Setting a number of target indicators that the developed strategy should provide. Depending on the priorities of the holding, such indicators may be a certain level of profitability, growth of market share or revenue, return on investment, etc.
• Coordination and approval of the subsidiary company's strategy.

In practice, the role of the holding company's parent company is usually contradictory. On the one hand, it actively encourages subsidiaries to break away from their immersion in operational activities and become concerned about their strategic future. On the other hand, many Russian parent companies are characterized by such manifestations as hypercontrol and interference in the implementation of the subsidiary’s strategic plan. Hypercontrol is expressed in monitoring a large number of indicators, which leads to chronic underfulfillment of the strategic plan and demotivation of the subsidiary’s management. Intervention most often manifests itself in the decision of the parent company to suspend the implementation of an investment project included in the strategic plan and to use these investment resources for other purposes. These potential difficulties should be taken into account and discussed in advance when developing a business development strategy.

Main stages of strategy development

Depending on the complexity and scale of the company’s business, the development format and size of the description of the prepared strategy can vary significantly. For example, the development strategy of a small entrepreneurial company is often developed in a one- or two-day strategy session. And the strategy of a large corporation is usually developed over several months with the active involvement of strategic consultants. The key stages of developing an enterprise development strategy, as a rule, remain the same (see diagram 1).

Diagram 1 - Main stages of developing an organization's strategy

Goals and strategic issues

The first question that arises even before formulating strategic goals is for whom this is being done in the first place - for ourselves or for an external user (investor, parent company of the holding, etc.). The content of the strategy itself should not change, but the emphasis in the preparation and presentation of the strategy may vary significantly. In a strategy for an investor, the description of the strategy should be closer to the format of a business plan: a detailed and well-structured strategic analysis, detailed justification and calculation of the required investments, etc. At the same time, in a “strategy for yourself”, a significant part of the analytical information well known in the company and detailed economic calculations can be omitted or written out abstractly.

Usually two or three goals are formulated that clearly set priorities in the company’s strategic actions. Our practice shows that you should not strive to develop complete statements of goals from the very beginning. Moreover, it is necessary to distinguish between different types of goals: if goals-criteria ( for example, to achieve a turnover of $100 million in five years) it can be useful to establish initially and, based on them, select suitable means of achieving them, then goals-actions(for example, creating your own distribution network in a certain territory) is more logical to accept after conducting a strategic analysis and choosing a specific strategic alternative. Otherwise, you have to face a situation where at the end of the strategic process everyone understands the unviability of the goals officially approved at the start, but it seems inconvenient to adjust them.

Who sets the goals? The answers from different companies vary from “the owner” to “all employees of the company” and depend on the management system and corporate culture. It can be recommended to integrate the formulation of goals into the company’s procedure for making key management decisions.

It is important to avoid double standards and being driven into a corner. For example, we were faced with a situation where the parent company of an industry holding company directed its subsidiaries to set, as one of their goals, a standard level of profitability that was clearly too high for this industry. Driven into a corner, the companies responded by rolling out an investment program to modernize production for a very round sum. As a result, there was a constant lack of funds for modernization, the profitability indicator was not achieved, but formally, when developing the company’s strategy, everything was done correctly.

Our experience shows that the most important prerequisites for formulating development goals are often the so-called strategic issues. Such questions are sometimes almost childish in nature and concern either threats (for example, “is our design bureau capable of developing competitive products of the next generation?”) or opportunities for the company’s development (for example, “what is stopping us from turning from a regional player into a national one?”).

However, it is not the strategic questions themselves that have the main value, but the strategic answers to them. For example, we may come to a difficult but honest answer that our designers will not be able to develop a sample of a new product on which we place a big bet within a given time frame, and we need to order engineering from the outside. Or that to become a national player we cannot do without attracting a serious investor. What is valuable here is that previously such strategic decisions were often not considered at all.

Strategic Analysis

Our strategic plans and decisions should be based whenever possible on sound facts, trends and forecasts. Ideally, a strategic plan would be created simply by translating the key findings of the strategic analysis into strategic action format. Unfortunately, in practice this most often does not work out.

Typically, strategic analysis includes the elaboration of a number of blocks (see Diagram 2).

Diagram 2 – Logic and stages of strategic analysis

In practice, a typical situation with the development of such blocks looks like this:

• Analysis of the external environment contains a large amount of varied information, from which, however, it is difficult to draw clear conclusions about what we should do
• Analysis of the internal environment is ascertaining in nature; it is difficult to understand from it what exactly in the company forms the basis of competitiveness, and what requires priority changes
• The forecasts are made either too formally (for example, based on the trend method) or too generalized (for example, within five years the consumption of our products is expected to increase by 30-100%)

Let's try to figure out what prevents the high-quality study of each of the main blocks of stratification.

IN analysis of the external environment Often, either the collection method predominates (a variety of unprocessed information about the market from various sources is brought into one place) or a formal systematic method (the capacity of the market and all its segments is systematically assessed, competitors and consumers are described, etc.). Such materials may look very impressive, but do not contain enough information to make informed decisions.

Both of these methods are variations of the frontal approach, in which we conduct analysis for our company in almost the same way as for a competitor company. Whereas the targeted approach is focused on in-depth study of issues that are of the greatest strategic importance specifically for our company.

The advantages of the targeted approach for practicing managers are quite obvious. Why do marketing analysts of companies, as a rule, avoid it?

• Many analysts prefer not to take responsibility for their own conclusions and results of secondary analysis, but simply provide “impersonal” facts, estimates and calculations.
• The manager does not set the task before them clearly and in detail, without explaining the certainty in which issues the results of the analysis of the external environment should provide

The key problem in analysis of the internal environment– the objective difficulty of giving an unbiased assessment of the advantages and disadvantages of organizing a business in your own company. As an effective method to overcome this problem, we can recommend using benchmarking. Comparing the main performance indicators and organization of business processes for you and other market participants will allow you to objectify the company’s self-assessment and take a fresh look at yourself. In industry holdings, it is easier to start by comparing relevant information on subsidiaries, subsequently supplementing it with data on the strongest competitors.

Preparation of justified forecasts– the most difficult part of strategic analysis. The successful solution of this problem is facilitated by the combination of several forecasting methods.

In practical terms, it is worth noting the following:

• Often, when preparing forecasts, the importance of external sources and experts is overestimated and the importance of internal experts is underestimated. Involving top managers and subject matter experts of the company often leads to the development of a very thoughtful and balanced forecast
• Forecasts for some types of business significantly depend on changes in a number of external uncontrollable parameters (for example, currency exchange rates, government tariffs, duties, etc.). For these types of businesses, the use of scenario planning is especially important, when separate forecasts for a given business are prepared for several of the most likely scenarios of changes in the external environment.
• In practice, the task of strategic analysis is not a clearly localized stage of strategy development. Issues that require additional analytical elaboration arise throughout the creation of a strategy.

Strategic Alternatives

Strategic alternatives describe significantly different options for the company's development. The presence of interesting and truly competitive strategic alternatives expands the vision of development prospects and makes the choice of the company’s final development path more conscious.

Practitioners are often overly skeptical about the need for this stage of strategy development, since they clearly see only one development option based on the previous logic of the company's development. The approach to what to do in such a situation may vary. If behind this lies the conservatism of a team accustomed to moving along a well-established track, it is necessary to insist on developing strategic alternatives. If behind such a position is the experience of a dynamic team that has managed to analyze and try out a whole range of ideas and development projects, then we can assume that they have already done the work of preparing alternatives.

Typically, each of the alternatives is based on one of the company’s large-scale development ideas. There are never many such ideas, so there are usually two or three alternatives. The value of exploring alternatives lies in the fact that we expand the logic of implementing a given development idea to more specific questions (which competencies are most important, how we position ourselves in the market, what we invest in, etc.).

When developing alternatives, such a point as the comparability of alternatives is of great importance; this will then make it possible to make a rational choice of one of them. To do this, first of all, it is necessary to at least enlarge the digitization of alternatives according to the same set of the most significant indicators at the end of the strategic planning period (revenue, profit, investment volume, etc.). Moreover, just because one of the alternatives is the leader in terms of these indicators, it does not automatically follow that it should be chosen. In some cases, risk analysis (tight deadlines for project implementation, lack of required competencies, etc.) leads to the conclusion that it is better to choose a less profitable, but more reliable or closer to the company alternative.

Strategic plan

Based on the chosen alternative, a strategic plan is prescribed, the key components of which are the strategic development concept and the program of activities to implement the strategy. The strategic concept succinctly describes the logic and objectives of development and the main activities for their implementation.

As a rule, at the stage of choosing an alternative, a number of ideas and development projects are quite general in nature. Therefore, at the stage of developing a strategic plan, they should be worked out in more detail. A successful method of solving this problem can be the formation of working groups to study each of the development projects. This allows not only to reduce work time, but also to involve the majority of middle managers, and even promising employees, in the development of the strategy. An additional effect is often the positive attitude of working group members towards solving new problems that arise at the stage of strategy implementation. As a result of the study of each development project, sometimes not only the content and timing of the required activities are specified, but also tasks at the interfaces of projects are identified, without the solution of which each of the related projects will be difficult to implement.

Preparing a program of activities to implement the strategy is a simple task for practitioners. Nevertheless, it is worth noting the importance of establishing personal responsibility for completing each of the activities on time, as well as the need to carefully coordinate the timing of all activities. This will make the program truly feasible.

Our experience has shown that at the stage of preparing a strategic plan, it is worth taking extra time to develop functional strategies for the main divisions of the company. When functional strategies are developed in close connection with the task of ensuring the implementation of strategy, they become clear, logical and well aligned with the functional strategies of other departments.

What indicators should be used to monitor the implementation of the strategy? Typically, the implementation of the strategy is monitored by the main financial indicators included in the strategic plan. On the one hand, these are exactly the indicators that interest owners. On the other hand, in practice it often turns out that the achievement (or non-achievement) of such indicators is influenced not only by the implementation of the strategy, but also by certain external factors. As a result, it may turn out that the team did everything to implement the strategy, but formally “failed” it, and vice versa, the strategic plan could have failed, but formally the indicators turn out to be in order. Apparently, such a system does not provide much motivation for the full implementation of the strategy.

It seems more logical to monitor both the implementation of key quantitative and time indicators of the strategy (for example, the number of sales points introduced per year or the timing of the commissioning of a new workshop) and the implementation of financial indicators. And above all, monitor key non-financial indicators of strategy implementation. If they are met, but the financial indicators are not, then it is necessary to analyze what exactly this is connected with.

There have always been individuals who did not accept working for someone else, wanting to do their own business. There are also people who, after working at some enterprise, open their own business.

Today, the question of starting your own business is especially relevant, since real incomes have fallen due to the state of the country’s economy. And by opening your own company, you can earn a decent income while working for your own pleasure.

What do you need to start your own business?

In order to start working for yourself, you need an idea, a large amount of money needed to purchase fixed assets, as well as a clear business strategy.

But how can you make sure that the business not only works, but also generates the necessary income without involving its owner in losses? The answer is simple - you need to have and follow a professionally developed strategy.

A business strategy is a specific approach to conducting business, which is developed based on the current state of affairs, as well as the desires of the shareholders or owners of the company.

What types are there?

There are many methods and plans in the world that are developed both for a specific enterprise and for the industry as a whole, or suitable for a certain group of companies.

Moreover, each business strategy has its own specific features. Examining each of them, we can distinguish the following types:

1. Concentrated increase.
2. Integrated magnification.
3. Diversified expansion.
4. Abbreviations.

In addition, each of them has several subspecies, which will be discussed below.

Concentrated Augmentation Strategy

Let’s look at the essence of this business strategy. It is associated with a change in the goods produced or services provided, as well as with a change in the market. At the same time, the main industry in which economic activity is carried out does not change.

In such a business strategy of an enterprise, the following areas of change can be distinguished:

• Increasing market share. It involves winning more customers through various marketing moves, as well as establishing new partnerships (buying up competitors or merging into one company, mutual cooperation agreements). Advertising is expensive, but organizations view it as an investment in their business.
• Search for new markets. In this case, the company will diligently search for new markets. Usually this is an expansion of the sales territory or an attempt to attract a new category of consumers.
• Product improvement. Involves redesign or improvement of manufactured products. If this does not bring success, then a new type of product is created, which the company begins to sell.

A business strategy of this nature works well especially for those companies that have sufficient resources and have a product that suits different categories of consumers.

Such a business development plan will not be suitable for all manufacturers due to lack of recognition in the market.

Integrated Growth Strategy

This type of strategy is usually used by companies that are successfully developing and want to increase their market share, as well as their profits.

This development plan is divided into two subtypes:

• Supply regulation. This means strengthening control over suppliers of inputs for production. In addition, it is possible to open your own branches or subsidiaries, which will partially or fully act as suppliers of raw materials. If only one or two suppliers have the necessary raw materials, then they can begin to impose their own conditions, which will run counter to the company’s goals and be unprofitable for it. In this case, it is better to start extracting resources on your own and not be led.

• Development of a sales network. It often happens that sales points do not meet the level required for large sales and cannot satisfy all demand, both in quantity and quality. The goal of a business strategy of this type is to begin selling goods independently at the proper level, as well as improve the quality of current points of sale. In this case, this is an excellent plan for the development of the company.

Such business strategies of the organization will require certain financial resources, which will need to be invested in the development of a sales network or supply sources.

The company should soberly assess whether it can painlessly “pull out” the necessary funds from the working capital, or whether it is worth turning to external investors for help.

Diversified expansion strategy

Such strategies are developed for companies that have exhausted themselves. This may be expressed in a slowdown in the pace of development or a decrease in its popularity due to the following factors:

• consumers are already bored and tired of the product;
• the market is already overcrowded with the type of product being produced;
• The industry is experiencing a decline in consumption.

Despite the dangerous circumstances for the further development of the company listed above, there are several subtypes of this strategy that will allow you to emerge victorious from this situation:

• Development of new production. The main task for a company when following such a strategy is to accumulate the necessary resources in order to begin production of new products that can be sold in the market it occupies. A lot of resources will be required because new production processes and technologies need to be mastered.
• Mastering the production of related products. You can also try producing products that will complement the main product. This requires fewer costs compared to the previous subtype, but requires quite a lot of infusions. There is no need to look for new sales routes for such products; existing opportunities will be sufficient, since they will complement the main product.
• Start of production of new products for other markets. If management is confident that the previous two subtypes will not help the company, then it decides to try to set up additional production, which will be focused on a new type of product and new markets. Such a strategy will require a lot of expenses. Small businesses will not be able to easily and painlessly find the necessary funds, unlike large corporations.

These types of strategies require much more resources and largely depend on the skills of management personnel in resolving such issues. Without competent leadership, such a path will not be possible.

Reduction strategy

Very often, after a period of rapid growth, there is a slowdown in the pace of development or even a decline in production. This is due to many factors that depend not only on the company itself, but also on the surrounding market.

In addition, there are also foreign economic and political components that also influence the development of a particular industry, market and individual company.

We need to soberly assess the situation

In such cases, there is a sound grain in considering strategies such as reduction in order to protect and increase the level of production efficiency, as well as strengthen the financial security of the company.

This business management strategy has the following subtypes:

• Liquidation. It is used only when the company no longer has a chance to survive. Considered a plan to close the business.
• Immediate income generation. Strategies of this subtype are used to maximize income in a minimum amount of time. It is usually used by those companies that do not see their further development and want to leave the market. At the same time, they want to get the maximum possible profit in this process. To do this, they begin to lay off workers, stop servicing goods and reduce other costs that do not affect profits.
• Partial closure. It is used in cases where a company wants to get rid of the unprofitable area of ​​its business, or to obtain additional funds that can be invested in successful production.
• Reduced cost levels. This business development strategy is used by companies that want to increase labor productivity and production efficiency. To achieve this, ways to reduce costs are being sought. This can be achieved both by automating the production process and by reducing “extra” personnel.

Of course, in practice, the same company can simultaneously use a strategy that will include several of the types listed above.

Without a good clear strategy, results can be unpredictable

Recently, the word startup (from the English start up) has been used very often, which means the beginning of the implementation of some new and good business idea.

Indeed, it is very important to occupy your niche in the market for providing services or selling goods - this is quite difficult in conditions of developed competition.

It is necessary to have and follow an approved development strategy

But, in addition to a good start, you need to have the right business plan so that such a start does not quickly turn into bankruptcy. Such a plan is a business strategy, adhering to which, you can not only successfully carry out business activities, but also successfully develop, increasing profits.

Therefore, if you want to run a profitable business, then be sure to do something like develop business strategies, or entrust it to knowledgeable professionals. After all, this procedure is a complex task that can only be completed by experienced specialists.

An enterprise development strategy is the way to achieve set goals and implement tasks. This is a long-term plan without specifying stages, methods and tactical actions. Strategy development is necessary to adapt a business to a changing external and internal environment in the market.

Strategy as part of planning

The choice of enterprise development strategies is part of the forecasting and planning system that has developed at a given enterprise.

The longer and more harmoniously the planning service works, the more accurate and adequate the choice of strategy will be, the implementation of which will allow the enterprise to develop steadily and firmly maintain its market niche.

The choice of strategy is always preceded by the collection of information about the state of the external and internal environment. The external environment refers to the state of all processes that can affect the efficiency of a given enterprise. These include:

• the state of the market for products manufactured by the enterprise;
• the state of the market for products that can replace the enterprise’s products;
• purchasing power of the population in general and in particular regarding the products of the enterprise;
• prospects and factors for changes in the purchasing power of the population;
• geographic and demographic factors affecting product sales;
• political situation;
• laws and regulations of various hierarchical levels;
• state development strategy.

Information about the internal environment, it would seem, is always there and does not need to be collected, although it always requires analysis. However, analyzing the work of a large enterprise only based on departmental reports is not always effective. In order to accurately know the state of the organization at the time of choosing a strategy, it is necessary to conduct an internal audit of the chosen focus.

The choice of strategy is carried out at the transition from forecasting to planning. The forecast for the development of an enterprise, country, region, humanity is a variety of development scenarios. The choice of one of the scenarios is the choice of strategy.

Types of enterprise strategies

Enterprise strategies in the most general form:

• growth strategy;
• limited growth strategy;
• reduction strategy;
• liquidation strategy;
• mixed strategies;
• product development strategy;
• industry development strategy.

However, in large enterprises, and especially in enterprises with a large number of branches, it is possible to formulate strategies by structural parts, industries, and areas of activity. Moreover, all of them may not coincide with the overall strategy and even contradict it.

In more detailed versions, the following strategies are distinguished:

• differentiation, that is, the creation of a product or service that would be absolutely new within a given organization;
• absolute cost leadership, which involves capturing the market by offering a product at reduced prices by minimizing costs;
• focusing or concentrating on the market of a product from a specific market segment.

Most often, enterprises, especially large ones, choose mixed strategies. They can be implemented in the form of combinations of the following types of strategies.

Progressive - implies the growth of an enterprise through the formation of structures that are located between the manufacturer and the end consumer.

Regressive - involves growth through the acquisition of new raw materials and their suppliers.

Horizontal - these are actions to absorb competing firms or establish strict control over their activities in the market.

Risks and uncertainties when choosing a strategy

Choosing any strategy involves certain risks. This is due to the great dynamics of market conditions and the fundamental impossibility of an absolutely accurate forecast. Any forecast is a range in which the pendulum of events, conditions and factors swings. Through the efforts of forecasters, this range can be narrowed, but no one can reduce it to the state of a point. However, even a point is also space.

The following hierarchy of risks in decision making can be distinguished.

1. Unlimited growth. A strategy can only be adopted for a short period of time. The risk is the possibility of rapid overproduction, filling market niches and reducing the pace of development to the point of stagnation.
2. Reduction. The risk is the loss of important structures, directions, technologies, part of the product range, development directions, etc. These losses may be due to an incorrect forecast or the emergence of new factors and conditions.
3. Liquidation. It would seem that by definition there can be no risks in liquidation, since if the enterprise is liquidated, then there is nothing to risk. However, liquidation based on incorrect forecast calculations is fraught with loss of capital for shareholders and owners, as well as irreparable and irrational loss when part of the enterprise is liquidated.
4. Moderate growth. This is a strategy of careful small steps. It does not promise big profits, but it minimizes the likelihood of losses.

Since the advent of industrial production, minimizing risks, damages and losses has worried the minds of scientists and practitioners.

By the second half of the 20th century, humanity, having gone through wars, revolutions and global crises, found a solution to this problem. It is possible to minimize risks only with the help of a planning system.

The development of this idea was realized in various forms and methods of planning. The most effective form of planning, as it turns out, is continuous planning, when constant short-term planning is carried out within the hierarchy of plans (strategic─long-term─medium-term─short-term). Its essence is the monthly adoption of plans for a year or another period based on the results of an analysis of the situation and the implementation of a previously adopted plan. However, such planning is only possible in the context of a large enterprise or its system. Small producers cannot afford such monitoring, so they have to adjust strategies within the framework of scheduling, which can also be effective.

Strategy development algorithm

Developing a development strategy for an enterprise or its structures is a complex multi-stage process. It consists of the following steps.

1. Defining the mission of the enterprise within the framework of the developed strategy. Mission refers to the place and role of an enterprise in modern society. The mission is the answer to the question “why does society need this enterprise?” Example of a mission: meeting the needs of the population for one or another type of goods or services.
2. The goal of developing a strategy is always to improve the manageability of a business and stabilize its position in the market.
3. Solved problems. Objectives are the stages of progress towards a goal while completing a mission. They may include:

• shaping the company’s image in new strategic conditions;
• developing a goal map and scorecard;
• developing a strategy implementation plan for the long, medium and short term;
• developing a schedule for implementing the strategy for 1 year or less.

1. Formation of strategy content. These could be:

• description of the strengths and weaknesses of the enterprise;
• assessment of opportunities and threats;
• cause-and-effect relationships between opportunities, threats, strengths and weaknesses of the strategy;
• drawing up a decision map in the context of alternatives (example: strengths/opportunities, weaknesses/opportunities, strengths/threats, weaknesses/threats);
• drawing up a hierarchy of strategic, medium-term and operational goals;
• identification of indicators characterizing the goals of various periods;
• description of the sequence and complexity of implementing decisions;
• appointment of responsible executors.

1. Work of the expert group on strategy development.

At the preliminary stage, a working group is created with the distribution of responsibilities, calendar dates and stages of the experts’ work process.

First stage. A methodology for assessing the internal and external environment of an enterprise is being developed to provide the possibility of comparison and generalization. All members of the expert group work according to a single template.

Second stage. Assessing the external environment of an enterprise in terms of opportunities and threats in business development. Each member of the expert group works independently.

Third stage. Collective expert assessment of the strengths or weaknesses, opportunities and threats of the development prospects of the enterprise. Based on the assessment results, a unified position is developed and a hierarchy of threats and opportunities is developed.

Fourth stage. Identifying cause-and-effect relationships between pairs of objects with a description of feedback connections, and then similarly defining connections between these pairs.

Fifth stage. Establishing cause-and-effect relationships between strengths, opportunities and threats.

Sixth stage. Drawing up a template matrix for expert assessment of scenario solutions.

Seventh stage. Assessment of changes in the internal environment of the enterprise in connection with the adoption of one or another development scenario.

Eighth stage. Making collective decisions using brainstorming techniques.

Ninth stage. Determining the timing and stages of implementation of the chosen strategy, creating a strategy map.

The enterprise strategy is considered adopted if it is fixed by order. The algorithm for adopting a strategy in detail depends on the size and capabilities of the enterprise, as well as on the radicality of the predicted changes when adopting a new strategy.