The strategic statement is a short version of a company's core strategy which articulates competitive advantages, objectives and defines scope. Those three aspects of business are crucial for strategy. Every company sets long term strategic goals and the direction for board policy. Strategic statement helps people that work for company to go into right direction during next years and to better understand and execute their roles.
Hierarchy of company strategic Statement:
- Mission, why the company exists
- Values, what to belief and hot to behave
- Vision, company's aim
- Strategy, plan to achieve it
- Balanced scorecard, how to monitor and implement the plan
Main elements of a strategic statement
Strategic statement is build based on three basic elements :
- objective describes the goal that should be achieved in given time frame
- scope the part of business landscape in which company will operate
- competitive advantage is the nature of company strategy, It defines approach to do thins differently and better than competition
It is crucial for strategy to set those elements, this also requires to find right middle ground. If company aims to growth then profit is no longer a priority objective.
Strategic's Objective The strategic objective is one-fold concrete that will lead company in the near future. Strategic objective shouldn't be confused with values, vision or mission those elements shouldn't be use as strategic goals. Objective should be strict, limited by time and possible to be measured. Strategic objective should be only one but its possible to set secondary goals that are coming from it.
Scope Company scope has three dimensions:
- to whom addressing product, target group of consumers,
- where to address it, geographic location
It is necessary to create boudoirs in every area it will help identify on which activities company should focus. There should be always space for indicatives and experimental projects outside of selected area, although it should point direction and highlight were business shouldn't go. It will secure company from wasting the budget on the things that are not going in line with company's strategy.
Competitive advantage This is the most important element of company’ strategy statement, It shows the mechanism what needs to be accomplished to succeed against competition. In order to defined it properly company should focus on be present value proposition, It has to be deeply analyzed why customers should purchase company's product, all difference between competition and own product should be highlighted. The most common standard value disciplines are: customer intimacy, operational excellence and product leadership.
Shaping strategic statement
Starting point for strategic statement should be making a product strategy, taking into consideration analysis of industry background. Essence of the company strategy should be included into strategic statement, created file should be easily understood by everyone in the company. During the process people from all levels should be involved.The work should be detailed but also brief and reflects three crucial elements.
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Author: Bartosz Aleksander