1.2 Elements of a successful business strategy

Successfully running a business requires a plan for start-up activities, daily operations, and growth for the future. So, in the same time, every successful business strategy has common requirements. The most important aspects are:

• The focus of a business strategy. There is an ever-increasing prevalence of incorporating global migration, international learning, skills recognition and multiculturalism strategies by businesses, governments, and educators in order to tackle anticipated pressures in service delivery, labor supply, and business investment. A business strategy motivates management and staff to recognize the benefits of developing and maintaining a global presence strategy for much greater creativity.

• Right understanding of a business strategy. In simple terms, a business strategy is an articulation of the overall direction of business. Strategies that are identical to those of competitors can result in the failure of company’s objectives. A business strategy may also be seen as a decision made at the highest levels of a company on positioning and direction. Such a decision serves to establish a clearly defined framework for subsequent decisions. Accordingly, a strategy and decision-making become inseparable; without organizational competence for decision-making, the formulation of a strategy in itself does not have much meaning.

• Compulsory elements of a good business strategy. A good business strategy steers clear of destructive competition. It has to focus on uniqueness, geared to delivering unique value to the important needs of target customers. A strategy should not be confused with aspiration. For example, "to become a leader in technology" is as a goal, not a strategy. A well-formulated business strategy is a definition of the goal and the ways that the business is going to achieve that goal. It also outlines boundaries for achieving the goal thus preventing any 'straying' from the set direction.

• A business strategy - need and purpose. Developing a good business strategy is a thoughtful process. It takes a balanced approach to come up with a strong, but flexible business strategy that may absorb change without disintegrating. Just as a good topographical map is indispensable to a hiker outlining explicit geographical hazards, so is a good business strategy to a company. It encompasses information on competitors and technology, suppliers and customers and provides directional guidance. In today's fast moving world, changes are fast and imminent. Use of the Internet lends a mind-boggling speed to nearly every business process. The competitive environment in which business has to operate is in a constant state of flux. A business strategy, therefore, has to be constantly monitored and modified to suit the circumstances, in order to remain progressive.

So, anyway, a good business strategy should address:

• Corporate culture. One should not here that the beliefs and values shared by people who work in an organisation have to be establish by a strategy. It should describe: how people behave with each other and with clients, how people view their relationship with stakeholders, people’s responses to energy use, community involvement, absence, work ethic, how the organisation behaves to its employees – training, professional development, etc. All of these questions may reflected in position and behaviour of the leadership, attitude to the role of individuals in the workplace – open plan offices, team based working, logotypes of the organisation, the image it presents to the outside world, its attitude to change. These aspects are certain to be driven by a vision and a mission statement of a company. A vision defines where an organisation wants to go in the future. A mission statement – summary of the beliefs of an organisation and where it is now. Ron Finklestein, a business coach and the owner of “YourBusinessCoach.net”, is convinced that for successful companies, culture is about attracting and hiring the people who would be most successful in that specific organization. And it is about driving the behavior that makes the company successful. [3] He stresses this idea in his article “What successful businesses have in common”.

• Strategic planning. It includes such elements as a vision, goals, aims, objectives, evaluation, etc. First Stage of Strategic Planning may involve: futures thinking (thinking about what the business might need to do 10–20 years ahead) and strategic intents (thinking about key strategic themes that will inform decision-making). As for a vision, on the one hand, it allows to communicate to all staff where an organisation is going and where it intends to be in the future to set goals. On the other hand, a vision allows a firm to set goals and aims. It is well-known that aims are long term targets. And ways in which a company is going to achieve it is called objectives. Doubtless, understanding of this difference is compulsory. For example, an aim may be for a chocolate manufacturer to break into a new overseas market. As for objectives, they consist of development of relationships with overseas suppliers, identification of retail outlets network, conducting of market research to identify consumer needs, search of location for overseas sales team. Once the direction is identified: analyse position, development and introduction of a strategy, evaluation. Evaluation is constant and the results of the evaluation feed back into the vision.

• Analysis. It is often said that analysis should be mark out as a separate element of a strategy. It approves importance of this aspect. One must admit that analysis is a core of business. In accordance with many experts, analysis includes observation of required inputs, SWOT, PEST, and five-forces. Studying of required inputs allows defining a quantity of resources needed to carry out a strategy. SWOT is an abbreviation whish means strengths, weakness, opportunities, and treats of a company. All of them should be analyse thoroughly. Barbara Eldridge, a small business expert and the president of “Mind master” point out ways of business development in her article “Four ways to develop a successful business strategy”. The author of that text writes that a business owner should use strengths and opportunities to achieve company’s goals, overcome its weaknesses, and control possible threats. [2] As for PEST, it means political, economical, social, and technological aspects of a company’s strategy. It is undeniable that study of these sides is rather important for any organization. The system of five-forces was developed by Michael Porter, the professor of Harvard Business School. He marked out forces that shape and influence on the industry or market an organisation operates in. First of them is a strength of barriers to entry which describes how easy is it for new rivals to enter the industry. The second is an extent of rivalry between firms – how competitive is the existing market. The third is supplier power – the greater the power, the less control the organisation has on the supply of its inputs. The next is buyer power which defines how much power do customers in the industry have. And the last is threat from substitutes which means what alternative products and services are there and what is the extent of the threat they pose.

• Evaluation. It is often said that evaluation should be marked out as analysis because it is extremely significant element of a business strategy. This element includes evaluation of such important indices as a share price, sales, a profit, a productivity, volumes, earnings, environmental and social audits.

There are basic elements of a successful business strategy, but it does not mean that there is an exhaustive list. These aspects characterize every company, but, in all probability, any organization has others aspects of its strategy by reason of its individuality.