Strategy Statement: Articulating Your Competitive Advantage, Objectives and Scope
When you have a start-up which consists of a team of several people, you need to have a clear and overall understanding of the strategy so that the whole project could be as successful as possible,
Without precise directions, it could easily lose the focus and be doomed to fail.
That’s where the strategy statement plays an important role because it gives a precise set of instructions to each of the employees.
There are three main elements: competitive advantage, objectives and scope, an only when each member has a full understanding of all the components, the start-up will have high chances to succeed.
UNDERSTANDING COMPANY STATEMENTS AND THEIR HIERARCHY
Before we get down to explaining all the segments in detail, there are several questions we have for you. What is your organization’s strategy? Can you describe it in around 40 to fifty words?
Do you think that person from your team sitting next to you would use the same words as you?
Believe it or not, the possibility that the members of the team have the same opinion is quite small.
This is actually natural and there are many reasons which lead to this phenomenon.
The initial strategy is actually familiar to all the team members, but as time goes by, it slowly fades away, adjusts and loses its idea from the beginning.
Of course, this doesn’t necessarily lead to a catastrophe but it’s necessary to revise and refresh this occasionally so that all the employees would be knowledgeable of it.
You all know how difficult is getting a common agreement on some simple trivia, such as lunch plans.
With that having said, getting them to agree on some far more important issues such as strategies and ideas to develop a project is quite challenging.
So, before you get down to exploring and implementing some complex strategies, make the simplest yet the hardest step for the beginning-talk about it!
Let us scratch the whole surface with defining the elements of company statements’ hierarchy.
There are five main elements and starting from the bottom those are:
- Mission, which explains the reason we exist
- Values, which define the things we believe in as well as our behavior
- Vision, which represents what we want to be
- Strategy, which defines our competitive game plan
- Balanced scorecard, which clarifies the details on plan monitoring and implementation
Before we deal with these elements, we need to make it clear how the pillars (competitive advantage, objectives, and scope) work and what is their role in the whole process.
FIGURING THE “OBJECTIVE” OUT
It is very important to be precise and not mix this element with values or mission.
How you define this element will have a significant impact on your overall business.
We can freely say that this is the motor that will drive your machine over the next several years.
This needs to be a single and specific explanation, which can be time bound and measurable.
You need to make it sound easily understandable to each and every member of your team.
The purpose of joining forces with other people is to create a group which will strive to the same goals.
Only when every single individual understands what is the main point and aim of the project, things will head the right way.
Only when you know where you are trying to get, you will have a road leading to there- is actually the simplest way to explain this segment.
One of the most common objectives is maximizing shareholder value.
However, the majority of strategies have this same goal, but it certainly doesn’t mean there’s a unified definition which can be applied to all the markets.
Each strategy needs to be tailored accordingly.
For example, your start-up will have different approaches depending on the type of the market you want to enter.
When walking into an existing market, your initial aim will be capturing the maximum of the market share from the competition. If this is the case, these are the steps for you to take:
- Determine the revenue which is in correlation with the desired market share.
- Break this down by the number of orders.
- The time has come for some reverse engineering of your sales funnel! Based on your revenue target, your task is to figure out the number of leads, prospects, and proposals needed.
Compared to trying to find your place in an existing market differs from entering a completely new one.
Instead of focusing on revenues, you need to put an accent on the following:
- Consumers’ education about your vision
- Turning this target group into reference consumers
If you apply these successfully, they will result in numerous positive things which will be strong proof that you are in the right way. Just to name a few:
- Website traffic will grow.
- The number of potential consumers will increase.
- Key opinion leaders will mention you and invite you to speak at conferences.
Of course, there are some positive outcomes on a general basis which can be applied to the majority of niches.
There are many specific details which each of them bears, and the point is that if you see these, you will have a confirmation that there’s enough place on the market for you.
If not, it’s time to create a different approach.
WHAT IS THE “ADVANTAGE” OF YOUR ORGANIZATION?
Can you name details that make you specific compared to the competition? Are you better or more efficient? What will your consumers remember you for?
There are just some of the questions that will help you give the right answer to what is your advantage.
However, even though this element is as significant as the other two, people often overlook it.
Only when you establish a sustainable competitive advantage you can be sure that the strategy you have is the right one.
Be clear on what makes your company or organization distinctive and turn that working in your favor.
Besides, only when you have this segment explained to all the employees will the whole machine work properly and direct you straight to success.
Every advantage consists of two segments:
- Statement of the customer value proposition which actually explains why consumers should be loyal to your products and services. If a strategy cannot explain that, your offering is doomed to failure.
- Your firm alone should be capable to deliver the customer value proposition. One of the ways to do so is capturing the unique activities; the other is actually a complex combination. Here all boils down to consistency about making choices.
“SCOPE” TO SET BOUNDARIES
This is the final out of three main parts of the strategy statement. This encompasses everything you are and you aren’t doing to achieve the objective.
This means either focusing on certain segments, such as location, the way of approaching consumers, the segment of the population or similar.
The main idea with defining the scope is that you don’t end up being everything for everyone.
This is definitely not a way to acquire a large group of consumers and bring more profit.
Let people recognize you by something unique, find your own niche.
The scope represents all the ways to achieve that goal.
It’s very important to note that scope is not limiting.
Do not understand it as a boundary you cannot cross, but more like some smart and practical directions where you should be heading to.
There’s always plenty of room for experimentation and initiative.
The greatest side of establishing the scope is that team members won’t waste time and resources on projects that do not fit the overall strategy of the corporation.
BE CLEAR ON YOUR “VISIONS”
In order to fully visualize your project at the moment and in the near future (something like 5 to ten years), you need to create a vision.
So whatever you establish as strategic goals and achieve them, how would it look like several years from now?
The mental image you project is very important.
This inspirational segment should motivate the employees to push forward and work united to achieve the goals.
There are certain steps which may help you establish the vision of your project.
While creating this in your mind, make sure you follow these simple guidelines:
- Try to define it in an inspirational and aspirational way.
- Do not treat it as “how to” as it should sound like an overly complicated instruction manual. This is not an explanation of how to reach your vision, but what is the vision. So, one average sentence is more than enough to explain this.
- Ask yourself what is the most unique thing about your offering and how would the consumers define it.
- There are always exceptions to the rules, as no human being is the same. This matters both for the people that are part of your team, as well as final consumers. Slight differences that are part of every great vision are those secret ingredients you should embrace. They are the secret weapon to achieve uniqueness and breathe some special energy in your project.
- Focus on the focus. The vision shouldn’t turn into daydreaming, but it often does, because this is one of the most enjoyable parts of the planning process. Do not get us wrong, it’s okay to be imaginative and dream big dreams but don’t forget to maintain the process as straightforward as possible.
NEVER FORGET WHAT YOUR “MISSION” IS ABOUT
This explains the reasons why your company/project exists.
The purpose of this segment is to support the vision and communicate the directions to team members.
When defining the purpose (mission) following these simple steps may be of help:
- Keep it simple and define it in an easy-to-grasp way. Do not use either jargon not overly academic expressions as both will stray the mission from its way.
- Make it sound motivational. Both team members and consumers should be encouraged to be with you, as they play important parts of your project. Team members are there to help you fulfill the idea, consumers are the reason you exist and will bring you profit.
- Don’t forget the purpose of the project, as this is the core segment of the mission.
- Be aware of the specific needs of the market you are trying to conquer, and take them into consideration when creating a mission. Whatever attracts consumers to buy or use services from you and not your competition is definitely one of the most vital segments of your mission. Find the right approach to address these needs and be clear on your company’s guidelines, to make it easier for your team members to follow the rules.
- If the mission consists of several smaller but equally important segments, establish priority among them and fulfill these one at a time. Don’t rush things as success overnight is not possible. You and your team may waste the strength of trying to achieve some difficult and impossible or too demanding things. Instead, a gradual approach may be a bit slower but is the right way to go.
- Find the right words to express it. Besides using adequate language, make sure your tone sounds right. Try to be concise but don’t forget to include all the aspects of the project.
- Again, keep things unique. When establishing the definition of your mission, don’t just stuff it with plenty of general phrases, but add some specific tone to it. This is particularly challenging if your offering is something that is already widely present on the market. It will inevitably be full of some expressions heard so many times, but there’s still something that makes your project different from the competition. That should be the key ingredient in defining both mission and vision and motivating people to be with you.
DEVELOPING “VALUES” STEP BY STEP
This represents a set of beliefs of your organization, and as a certain compass, shows how the organization will behave.
This goes for the decision-making process and the establishing standards which will serve as the evaluation measure when comparing the actions.
Those core principles of an organization culture are actually the values and beliefs a company follows.
So, core values play an important role in shaping the company culture, reflecting it on team members and motivating them to support the whole idea.
This philosophy is the essence of the values of the project or company.
What comes as absurd is that people often focus on technical aspects of the project and often oversee these core values that make the machine run smoothly.
When you establish them to be strong, many advantages will come as a result, both internal and external.
Here are some of the reasons why values play such an important part of the project:
- By reflecting who you really are, values are actually something you don’t create but discover.
- When making decisions, this serves as a measure of whether the final offering meets the standards or not. If it doesn’t, you don’t make compromises with the quality, you immediately eliminate it.
- Values identify you on the market; they are something that consumers recognize you for. So, the more specific they are, the easier people will notice and remember you. If your values are distinguishable, you can be sure that you have a competitive advantage.
- As values are something that comes from the inside, they are often in relation to talents. This is the element that helps people unite around the same idea and strive to the same goal. If this combination is a matching one, then reaching the target consumers will come as a natural and logical consequence. Moreover, as the business grows, this helps in identifying whether you can or cannot unite with some other companies and strengthen the position on the market even more.
- Values are timeless, and they do not change. All other segments undergo various transformations, but this, representing the core, doesn’t. So, regardless of the economic situation, strategy adjustments etc., these remain the same.
So, when you define this as something that comes from the inside, it makes you think that discovering these core values is a piece of cake.
Well, it’s not, as sometimes people are not immediately aware who they really are.
However, there are always some questions which can help you discover these and here they are:
- Be they awarded or not, do the values remain fundamental no matter what?
- Is there anything that may make you change them?
- If you envision these 100 years from now, do they still remain valid and vital as they are at the moment?
- At some point, if these turn into a competitive disadvantage, would the company still hold on to them?
- If you are establishing a new project or organization, would you implement these values even if the niche is completely different from the previous one?
The answers to these questions are actually what explains the difference between core values and strategies. The values remain unchanged regardless of the external and internal factors.
On the other hand, strategies are adjustable and actually SHOULD undergo changes per situation request.
If the answer to the question is positive, you can be sure that you are familiar with the true meaning of core values and you can constitute an organization, because you have that most special spice that gives the personality to your project.
Even though we mentioned philosophy when describing the meaning of values, it doesn’t mean that it’s something beyond the reach and inapplicable in terms of business.
There is actually a set of values that are commonly present in projects regardless of the niche or industry:
- Balance is important for maintaining a healthy working environment.
- Social responsibility and contribution are the main segments that make up a true community.
- Accountability, both as personal and in general is the ability to take responsibilities for the actions, decision, policies, and offerings.
- Commitment gives the spirit to the organization as this one represents striving to the same big goal that leads to the organization becoming recognizable for being unique.
- Empowering employees to adopt an error-embracing environment and encourage them to take initiative, lead and give their best.
- Diversity is what makes one uniqueness be more unique than the other. Respect it and establish a program that will employ a wide range of diverse people.
- Innovation represents that necessary element to pursue and create ideas with the strong potential that they can change the world.
- Ownership is not about being the boss, by taking care of the team, project, and consumers as if they are your own (family). It doesn’t mean you should be excessively emotional, but simply treat these elements with respect.
- Being honest and never compromise the truth gives your project integrity.
- Creating a safe working environment in terms of legal and health aspects means you put an accent on establishing safety as an important part of your company.
STRATEGY DEVELOPMENT SUMMARY
As you can see, this is quite a considerable and complex thing, but there’s nothing that you cannot achieve.
The most important is to have patience and let things go their natural way.
Majority of things boil down to making a good plan, so does this one.
There’s certainly not a unique recipe for success, especially not the one that guarantees an overnight success.
However, the segments described here can for sure be applied to any field.
Seeing so many steps to take makes you think that it’s impossible to find the starting position.
But, step by step approach can be of help.
The first thing to do is do some brainstorming by yourself.
Our article here can serve as a useful and practical guide what are the elements to pay attention to. Start with the values.
Check if you can make the difference between them and strategy. Once you finish with discovering these core parts of (yourself and) your project, try to define the mission and vision.
In addition to this, try to think about how many people are necessary to make your idea come to life.
Do a little market research and try to find the target group of consumers. Try to figure out the perfect timing to release your project.
When you finish these, get down to the final three segments, scope, objective and competitive advantage. As soon as you have all the parts of the puzzle, it’s action time.
Once again, be patient, have faith and be proactive.
Finally, building a compassionate society, by providing an integrated set of solutions to a target group is what these three elements are about.
This is the ultimate definition of the company statement.
If you can “accommodate” your project or business in this definition and explain it using no more than fifty words, you can be sure you are on the right way.
You have learned what the essentials of the three main elements are.
In addition to this, you are aware of the importance of mission, vision, and values and their vital role.
Once you learn how competitive advantage, objectives, and scope as the core elements of strategy statement work, you will number one in your niche on the market.
This is definitely easier said than done but do not give up.
Every road to success is full of obstacles but do not let this discourage you. Keep on trying and the effort will pay off.
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