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Business Strategy Examples In 2024: Examples, Case Studies, And Tools

A business strategy is a deliberate plan that helps a business to achieve a long-term vision and mission by drafting a business model to execute that business strategy. A business strategy, in most cases, doesn’t follow a linear path, and execution will help shape it along the way.

Table of Contents

What is a business strategy?

At this stage, it is important to clarify a few critical aspects.

As an HBR working paper entitled “From Strategy to Business Models and to Tactics” pointed out:

Put succinctly, business model refers to the logic of the firm, the way it operates and how it creates value for its stakeholders. Strategy refers to the choice of business model through which the firm will compete in the marketplace. Tactics refers to the residual choices open to a firm by virtue of the business model that it employs.

Personally, I have a controversial relationship with the concept of “strategy.” I feel it’s too easy to make it foggy and empty of practical meaning.

Yet strategy and vision matter in business.

A strategy isn’t just a calculated path, but often a philosophical choice about how the world works.

Usually, it takes years and, at times, also decades for a strategy to become viable. And once it does become viable, it seems obvious only in hindsight.

In this guide, we see what that means.  

In the real world, the difficult part is understanding the problem

In the real world, a lot of time and resources are spent on defining the problem.

Classic case studies at business school assume in most scenarios that the problem is known and the solution needs to be found.

In the real world, the problem is unknown, the situation is highly ambiguous, and the most difficult part is making the decision that might solve that same problem you’re trying to figure out. 

How do you execute a strategy in that context? Business modeling can help!

Is a business strategy the same thing as a business model?

As the business world started to change dramatically, again, by the early 2000s, also the concept of strategy changed with it. 

In the previous era, the strategy was primarily made of locking in the supply chain to guarantee a strong distribution toward the marketplace. 

And yet, the web enabled new companies to form with a bottom-up approach.

In short, product development cycles shortened, and frameworks like lean , agile , and continuous innovation became integrated into a world where software took over. 

Where most of the processes before the digital age, were physical in nature. As the web took off, most of the processes became digital.

In short, the software would become the core enhancer of hardware. 

We’ve seen how in cases like Apple’s iPhone , it wasn’t just the hardware that made the difference.

But it was the development ecosystem and the applications that enhanced the capabilities of the device. 

Thus, from a product standpoint, hardware has been enhanced more and more with the software side.

At the same time, the way companies developed products in the first place changed. 

Software and digits-based companies could gather feedback early on, thus enabling the customers’ feedback as a key element of the whole product development cycle. 

Therefore, wherein the previous era, companies spent billions of budgets to release markets, and products, with little customer feedback.

In the digital era, customer feedback became built into the product development loop. 

That led to frameworks with faster and faster product releases, which also changed the way we do marketing . 

In a classic MVP approach, the loop (build, measure, learn) has to be very quick, and it has to lead to the so-called product/market fit .

As the web made the ability to gather customers’ feedback early on, and as the whole process becomes less and less expensive, also lean approaches evolved, to gain feedback from customers as early as possible. 

From build > demo > sell, to demo > sell > build , lean approaches got leaner. 

And the era of customer-centrism and customer obsession developed:

This whole change flipped the strategy world upside down.

And from elaborate business plans , we moved to business modeling , as an experimental tool, that enabled entrepreneurs to gather feedback continuously.

In a customer-centered business world, business models have become effective thinking tools, to represent a business and a business strategy on a single page, which helped the whole execution process. 

The key building blocks of a classic business model approach, like a business model canvas or lean startup canvas  move around the concept of value proposition , that glue them together. 

And from the supply chain , we moved to customer value chains .

Where most digital business models  learned to gather customers’ feedback in multiple ways. 

The business strategy formed in the digital era, therefore, developed its own customer-centered view of the world, and the business theory world followed.

Academics, following practitioners, moved away from traditional models (like Porter’s Five Forces ) to more customer-centered approaches ( business model canvas , lean canvas).  

The mindset shift flipped from distribution and optimization on the supply side.

To optimize on the demand side, or how to build products that people want, in the first place. This is the new mantra.

No more grandiose business plans, just substantial testing, iteration, and experimentation. 

In this new context, we can understand the strategy developed by several players and how business modeling has become the most important strategy tool. 

And the interesting part is, whether you want to scale to become a tech giant, or you just want to build a small, viable business, it all starts from the same place!

Is business strategy a science?

Business strategy is more of an art than a science.

In short, a business strategy starts with a series of assumptions about how the business world looks in a certain period of time and for a certain target of people.

Whether those assumptions will turn out to be successful will highly depend on several factors.

For instance, back in the late 1990s when the web took over, new startups came up with the idea of revolutionizing many services.

While those ideas seemed to make sense, they turned out to be completely off, and many of those startups failed in what would be recognized as a dot-com bubble.

While in hindsight certain aspects of that bubble came up (like frauds, or schemes).

In general, some of the ideas for which startups got financed seemed to be visionary and turned out to work a decade later (see DoorDash , or Instacart , in relation to Webvan’s bankruptcy). 

For instance, some startups tried to bring on-demand streaming to the web (which today we call Netflix ). Those ideas proved to be too early.

They made sense but from the commercial standpoint, they didn’t.

Thus, if we were to use the scientific method, once those assumptions would have proved wrong in the real world, we would have discarded them.

However, those assumptions proved to be wrong, in that time period, given the current circumstances.

While we can use the scientific inquiry process in business strategy, it’s hard to say that it is a scientific discipline.

So what’s the use of business strategy?

In my opinion, business strategy is useful for three main reasons:

• Focus : chose one path over another.
• Vision : have a long-term strategic goal.
• Commercial viability : create a self-sustainable business.

As a practitioner, someone who tries to build successful businesses, I don’t need to be “scientific.”

I need to make sure not to be completely off track. For that matter, I aim at creating businesses.

Thus, I need to understand where to focus my attention in a relatively long period of time (3-5 years at least) and make sure that those ideas I pursue are able to generate profits, which – in my opinion – might be a valid indicator that those ideas are correct for the time being.

If those conditions are met, I’ll call it a “successful business.”

Those ideas will become a business model , that executes a business strategy.

This doesn’t mean those ideas, turned into a business model , pushed into the world will always be successful (profitable).

As the marketplace evolves I will need to adjust, and tweak a business model to fit with the new evolving scenarios, and I’ll need to be able to “bet” on new possible business models .

Survivorship bias

Survivorship bias is a phenomenon where what’s not visible (because extinct) isn’t taken into account when analyzing the past.

In short, we analyze the past based on what’s visible.

This error happens in any field, and in business, we might get fooled by that as well.

In short, when we analyze the past we do that in hindsight.

That makes us cherry-pick the things that survived and assume that those carry the successful characteristics we’re looking for.

For instance, for each Amazon or Google that survived there were hundreds if not thousands of companies that failed, with the same kind of “successful features” as Amazon or Google.  

So why do we analyze successful companies in the first place? In my opinion, there are several reasons: 

• Those successful companies have turned into Super Gatekeepers to billions of people : as I showed in the gatekeeping hypothesis , and in the surfer’s model , a go-to-market strategy for startups will need to be able to leverage existing digital pipelines to reach key customers.

• Modeling and experimentation : another key point is about modeling what’s working for other businesses and borrowing parts of those models, to see what works for our business. By borrowing parts you can build your own business model, yet that requires a lot of testing. 

• Skin in the game testing : therefore business models become key tools for experimentation, where we can use real customers’ feedback (not a survey, or opinions but actions) and test our hypotheses and assumptions. When we’re able to sell our products, when people keep getting back to our platform, or service, there is no best way to test our assumptions that measure those actions. 

Lindy effect and aging in reverse

Nicholas Nassim Taleb , in his book Antifragile , popularized a concept called Lindy Effect .

In very simple terms the Lindy Effect states that in technology (like any other field where the object of discussion is  non-perishable)  things age in reverse.

Thus, life expectancy, rather than diminishing with age, has a longer life expectancy.

Therefore, a technology that has lived for two thousand years, has a life expectancy of another thousand years.

That is a probabilistic rule of thumb that works on averages.

Thus, if a technology (say the Internet) has stayed with us for twenty years, it doesn’t mean we can expect only to live for another twenty years at least.

But as the Internet has proved successful already, the Lindy Effect might not apply.

In short, as we have additional information about a phenomenon the Lindy Effect might lose relevance.

For instance, if I know a person is twenty, yet sick of a terminal disease, I can’t expect to use normal life expectancy tables.

So I’ll have to apply that information to understand the future.

Strategies take years to fully roll out

It was 2006, when Tesla, with his co-founder   Martin Eberhard , launched a sports car that broke down the trade-off between high performance and fuel efficiency.

Tesla, which for a few years had been building up an electric sports car ready to be marketed, finally pulled it off.

As Elon Musk would   explain   Back in 2012:  

In 2006 our plan was to build an electric sports car followed by an affordable electric sedan, and reduce our dependence on oil…delivering Model S is a key part of that plan and represents Tesla’s transition to a mass-production automaker and the most compelling car company of the 21st century.

The beauty of a strategy that turns into a successful company, is that it might take years to roll out and seem obvious only in hindsight. 

This connects to what I like to call the transitional business model.

Or the idea, that many companies, before getting into a fully rolled out business strategy, transition through a period of low scalability and low market size, which will help them gain initial traction. 

As a transitional business model proves viable, it helps the company shape its long-term vision, while its built-in strategy is different from the long-term strategy.

The transitional business model will guarantee survival. It will help further refine the long-term strategy and it will also work as a reality check. 

As the transitional business model proves viable, the company moves to its long-term strategy execution. 

As the business strategy gets rolled out, over the years, it becomes evident and obvious, and yet none managed to pull it off.

When Netflix moved from DVD rental to streaming. DVD rental was the transitional business model that helped Netflix stay in business in the first place.

And yet, when Netflix moved from DVD to streaming it had to apparently change its strategy.

When, in reality, it was rolling out its long-term strategy, shaped by the transitional business model. 

Caveat: Frameworks work until suddenly they don’t

When you stumbled upon a “business formula,” you can’t stop there.

That business formula, if you’re lucky, will allow you to succeed in the long term. Yet as more and more people will find that out, that will lose relevance.

And the matter is, the reality is a villain. Things work for years until they suddenly don’t work anymore.

We’ll see some frameworks, but the real deal is not a framework but the inquiry process that makes us discover those frameworks.

In short, the value is in the repeatable process of discovery and not in the discovery itself. A discovery, once spread, loses value.

Master a business strategy process

There isn’t a size-fits-all business playbook that you can apply to all the scenarios.

Some of the business case studies we’ll see throughout this article will show companies that have dominated the tech space in the last decade and more.

While the playbook executed by those companies worked for the time being.

That doesn’t mean you should play according to their playbook. If at all you’ll need to figure out your own.

Thus, what matters is the process behind finding your business playbook and my hope is that this guide will inspire you and give you some good ideas on how to develop your own business strategy process!

Business strategy case studies

We’ll look now at a few case studies of companies that, at the time of this writing, are playing an important role in the business world.

• Alibaba Business Strategy.
• Amazon Business Strategy.
• Apple Business Strategy.
• Airbnb Business Strategy.
• Baidu Business Strategy.
• Booking Business Strategy.
• DuckDuckGo Business Strategy.
• Google (Alphabet) Business Strategy.

What is a business model’s essence?

Keeping in mind the distinction between business strategy and business models is critical.

The other element used in this guide is a business model essence.

Shortly, I’ve been looking for a way to summarize the key elements of any business in a couple of lines of text:

Therefore, for the sake of this discussion, you’ll find each company’s business strategy, a business model essence that will help us navigate through the noisy business world.

From there, we’ll see the business strategy of a company.

Alibaba Business Strategy

Business Model Essence : Online Stores Leveraging On An E-Commerce/Marketplace Distribution And Monetization Strategy  

As pointed out in Alibaba’s annual report for 2017:

We derive revenue from our four business segments: core commerce, cloud computing, digital media and entertainment, and innovation initiatives and others. We derive most of our revenue from our core commerce segment, which accounted for 85% of our total revenue in fiscal year 2017, while cloud computing, digital media and entertainment, and innovation initiatives and others contributed 4%, 9% and 2%, respectively. We derive a substantial majority of our core commerce revenue from online marketing services. 

Alibaba, like Amazon , became an “everything store” in China.

It leveraged its success to build also other media platforms ( Youku Todou and UCWeb). The e-commerce, marketplace business model has become quite common since the dawn of the web.

From that business model tech giants like Amazon , eBay and Alibaba have raised.

Alibaba’s vision, mission, and core principles

Alibaba’s Business Strategy starts from its core values defined in its annual report:

• Customer First : “The interests of our community of consumers, merchants, and enterprises must be our first”
• Teamwork: “ We believe teamwork enables ordinary people to achieve extraordinary things.”
• Embrace Change   I”n this fast-changing world, we must be flexible, innovative, and ready to adapt to new business conditions in order to maintain sustainability and vitality in our business.”
• Integrity “We expect our people to uphold the highest standards of honesty and to deliver on their commitments.”
• Passion “We expect our people to approach everything with fire in their belly and never give up on doing what they believe is right.”
• Commitment  “Employees who demonstrate perseverance and excellence are richly rewarded. Nothing should be taken for granted as we encourage our people to “work happily and live seriously.”

Alibaba’s mission is “ to make it easy to do business anywhere, ” and its vision is “to build the future infrastructure of commerce… a company that would last at least 102 years.”

For that vision to be executed it has three major stakeholders: users, consumers, and merchants.

The focus on the “at least 102 years” might seem fluffy words, yet those are important as this kind of goal helps you keep a long-term vision while executing short-term plans.

It isn’t unusual for founders to set such visions, as they help keep the company on track in the long run.

And this is where a business strategy starts.

All the business models designed by Alibaba will follow its vision, mission, and values they aim to create in the long run.

Read : Alibaba Business Model

Alibaba ecosystem and value proposition

These elements gave rise to an ecosystem made of “consumers, merchants, brands, retailers, other businesses, third-party service providers and strategic alliance partners.”

As Alibaba points out in its annual report “our ecosystem has strong self-reinforcing network effects benefitting its various participants, who are in turn invested in our ecosystem’s growth and success.”

Network effects are a critical ingredient for marketplaces’ success.

To give you an idea, the more buyers join the platform, the more Alibaba’s recommendation engine will be able to suggest relevant items to buy for other customers, and at the same time the more merchants will join in, given the larger and larger business opportunities.

Keeping these network effects going is a vital element of long-term success but also among the greatest challenge of any marketplace that wants to be relevant.

Even though Alibaba’s essence is in online commerce, the company has several business model s running and a business strategy that at its core is evolving quickly.

Thus, the core commerce has made it possible for Alibaba to build a whole new set of “companies within a company.”

From digital entertainment and media, logistics services, payment, financial services, and cloud services with Alibaba Cloud.

Thus, from a successful existing online business model , Alibaba has expanded in many other areas.

And its future business strategy focuses on developing, nurturing, and growing its ecosystem.

More precisely, its strategic long-term goal is to “serve two billion consumers around the world and support ten million businesses to operate profitably on its platforms”

To achieve that Alibaba is focusing on three key activities:

• Globalization.
• Rural expansion.
• And big data and cloud computing.

For its core commerce activities, Alibaba has designed a value proposition that moves around a few pillars:

• Broad selection: over 1.5 billion listings as of March 31, 2018.
• Convenience:  seamless experience anytime, anywhere from online and offline.
• Engaging, personalized experience: personalized shopping recommendations and opportunities for social engagement.
• Value for money: competitive prices offered via a marketplace business model.
• Merchant quality: review and rating system to keep merchants’ quality high.
• Authentic products: merchant quality ratings, clear refund, and return policies, and the Alipay escrow system.

From that value proposition , Alibaba has been able to grow its customer base and offer wider and broader products, until it expanded in the service and cloud business.

Amazon Business Strategy

Business Model Essence : E-Commerce/Marketplace Distribution And Monetization Model Leveraging On Proprietary Infrastructure To Offer Third-Party Services

Starting in 1994 as a bookstore, Amazon soon expanded and became the everything store.

While the company’s core business model is based on its online store.

Amazon launched its physical stores, which generated already over five billion dollars in revenues in 2017.

Amazon Prime (a subscription service) also plays a crucial role in Amazon’s overall business model , as it makes customers spend more and be more loyal to the platform. 

Besides, the company also has its cloud infrastructure called AWS, which is a world leader and a business with high margins. Amazon also has an advertising business worth a few billion dollars.

Thus, the Amazon business model mix looks like many companies in one. Amazon measures its success via a customer experience obsession, lowering prices, stable tech infrastructure, and free cash flow generation.

Therefore, even though in the minds of most people Amazon is the “everything store.”

In reality, its revenue generation shows us that it has become a way more complex organization, that also has a good chunk of advertising revenue and third-party services.

For instance, Amazon is also a key player with its AWS in the cloud space.

And is well a key player in the digital advertising space, together with Google and Facebook :

Amazon has been widely investing in its technological infrastructure since the 2000s, which eventually turned into a key component of its business model .

Read : Amazon Business Model

Amazon’s vision, mission, and core values

Jeff Bezos is obsessed with being in “day one,” which as he puts it , “ day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always  Day 1. “

It all starts from there, and to achieve that Jeff Bezos has highlighted a few core values that makeup Amazon ‘s culture and vision :

• Customer obsession.
• Resist proxies.
• Embrace external trends.
• High-velocity decision-making.

As pointed out by Amazon , “w hen Amazon.com launched in 1995, it was with the mission “ to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. ” 

This goal continues today, but Amazon ’s customers are worldwide now and have grown to include millions of Consumers, Sellers, Content Creators, and Developers & Enterprises.

Each of these groups has different needs, and we always work to meet those needs, innovating new solutions to make things easier, faster, better, and more cost-effective.”

In this case, Amazon ‘s mission also sounds like a vision statement.

Whatever you want to call it, this input is what makes a company look for long-term goals that keep them on track.

Of course, that doesn’t mean a well-crafted vision and mission statement is all that matters for business success.

Yet, it is what keeps you going when things seem to go awry.

Amazon moved from an online book store to the A-to-Z store it kept its mission almost intact while scaling up.

Start from a proof of concept, then scale up

It is interesting to notice how businesses evolve based on their commercial ability to scale up.

When Amazon started up as a bookstore, it made sense for several reasons, that spanned from logistics to pricing modes and industry specifics.

Yet, when Amazon finally proved that the whole web thing could be commercially viable, it didn’t wait, it grew rapidly.

From music to anything else it didn’t happen overnight, but it did happen quickly.

Thus, this is how Amazon’s mission shifted from “any book in the world” to “anything from A-Z.”

This isn’t a size-fits-all strategy. Amazon chose rapid growth, similar to a blitzscaling process as aggressive growth was a way to preserve itself.

Hadn’t Amazon grown so quickly, it could have been killed.

The opposite approach to this kind of strategy is a bootstrapped business, which is profitable right away and self-sustainable.

Decentralized and distributed value creation: the era of platforms and ecosystems

Before we move forward, I want to highlight a few key elements to have a deeper understanding of both Amazon and Alibaba’s business models and their strategies.

Before digitalization would show its use and commercial viability, most of the value creation processes were internalized.

That meant companies had to employ massive resources to generate value along that chain.

That changed when digitalization allowed the value creation process to be distributed, and we moved from centralized to grassroots content creation.

This is even clearer in the case of platforms, and marketplaces like Amazon and Alibaba.

For instance, where in the past the review process and quality insurance would be done centrally by making sure that the supply complied with the company’s quality guidelines.

Introducing distributed review systems, where the end-users checked against the quality compliance, allowed companies like Alibaba and Amazon to generate network effects, where the more users enriched the platforms with those reviews the more the platform could become valuable.

For that matter though, the main platform’s role will be to fight spam and attempt to trick the system.

Other than that (fighting spam is a challenging task) all the rest is managed at the decentralized level, and the value creation happens when more and more users review products and services on those platforms.

We’re referring here to the review system, but it applies almost to any aspect of a platform.

Amazon for years allowed third-party to feature their stores on Amazon ‘s platform, while they kept the inventory.

This meant an outsourced and distributed inventory system, spread across the supply side.

Therefore, the supply side not only made the platform more valuable by creating compelling offerings.

But it also made it more valuable from the operational standpoint, by allowing a better inventory system, which could be turned quickly.

Therefore, the critical aspect to understand in the digital era is decentralized value creation, which makes the value creation process less expensive for an organization, more valuable to its end users, and more scalable as it benefits from network effects.

How do decentralize value creation?

Many platform-like business models have leveraged a few aspects:

• User-generated content (Quora, Facebook , Instagram).
• Distributed inventory systems ( Amazon , Alibaba).
• Peer-to-peer networks ( Airbnb , Uber).

This implies a paradigm shift.

When you start thinking in terms of platforms, no longer you’ll need a plethora of people taking care of each aspect of it.

Rather you’ll need to understand how the value creation can be outsourced to a community of people and make sure the platform is on top of its game in a few aspects.

For instance, Amazon and Alibaba have to make sure their review system isn’t gamed. Airbnb has to make sure to be able to guarantee safety in the interactions from host to guests and vice-versa.

Quora has to make sure to keep its question machine to keep generating relevant questions for users to answer (the supply-side).

If you grasp this element of a platform, you’re on a good track to understanding how to build a successful platform or marketplace.

Apple Business Strategy

Business Model Label : Product-Based Company Leveraging On Locked-In Ecosystems With A Reversed Razor And Blade Business Strategy

Apple sells its products and resells third-party products in most of its major markets directly to consumers and small and mid-sized businesses through its retail and online stores and its direct sales force.

The Company also employs a variety of indirect distribution channels , such as third-party cellular network carriers, wholesalers, retailers, and value-added resellers.

During 2017, the Company’s net sales through its direct and indirect distribution channels accounted for 28% and 72%, respectively, of total net sales.

Many people look at the iPhone, or the previous products Apple has launched successfully in the last decade and assume that their success is due to those products.

In reality, Apple has followed throughout the years a strategy that focused on five key elements:

• Strong branding.
• Beautifully crafted products.
• Technological innovation.
• Strong distribution.
• Locked-in ecosystems.

In short, Apple can sell an iPhone at a premium price because it employs a reversed razor and blade strategy.

This strategy implies free access to Apple’s Ecosystem (ex. iTunes, and Apple Store).

That makes the whole experience through Apple’s devices extremely valuable.

Thanks to that experience, the perception of high-end (luxury-like) products, together with a reliable distribution, justifies Apple’s premium prices.

Apple’s managed to build a business platform on top of the iPhone, thus creating a strong competitive moat, which lasts to these days:

Therefore, Apple’s future success can’t be measured with the same lenses as the last decade.

The real question is: what product will Apple  be able to launch successfully?

And keep in mind it’s not just about the product. Apple’s formula summarized above can be replicated over and over again.

But it isn’t a simple formula. And as locked-in ecosystems, in which Apple controls as much as possible, the experience of its users has proved quite successful in the last decade.

That might not be so in the next, given the rise of more decentralized infrastructure.

For that matter, Amazon might be well moving from a reversed razor and blade model:

To a service-based model:

This isn’t surprising, as a service business has a few compelling advantages:

• High margins.
• A relatively stable revenue stream.
• Scalability.

As Apple has relied on home runs with its products, from the new Mac to the iPod, iPhone, and iPhones, that kind of success isn’t easy to replicate, and it makes the company relies on a continuous stream of fresh sales to keep the business growing.

A service business would balance things out.

It is important to remark this isn’t something new to Apple :

When Apple introduced the iPhone, it isn’t like it was an overnight success. It was successful, but it had to create a whole ecosystem to make the iPhone a continuous source of growth for the company!

When it comes to business strategy, as pointed out in Apple’s annual reports:

The Company is committed to bringing the best user experience to its customers through its innovative hardware, software and services. The Company’s business strategy leverages its unique ability to design and develop its own operating systems, hardware, application software and services to provide its customers products and solutions with innovative design, superior ease-of-use and seamless integration.

Understanding this part is critical. As I explained above, at the time of this writing many think of Apple as the “iPhone company.”

Yet Apple is way more than that, and its business strategy is a mixture of creating ecosystems by leveraging on these pillars:

• Operating systems.
• Applications software.
• Innovative design.
• Ease-of-use.
• Seamless Integration.

Those elements together make Apple ‘s products successful. As Apple further explained:

As part of its strategy, the Company continues to expand its platform for the discovery and delivery of digital content and applications through its Digital Content and Services, which allows customers to discover and download or stream digital content, iOS, Mac, Apple Watch and Apple TV applications, and books through either a Mac or Windows personal computer or through iPhone, iPad and iPod touch® devices (“iOS devices”), Apple TV, Apple Watch and HomePod.

Once again, it isn’t anymore about creating a product, but about generating self-serve ecosystems.

How do you support those ecosystems?

It depends on what’s your target. A media company will primarily need an ecosystem made of content creators (take Quora or Facebook or YouTube ).

In many cases, a digital media company over time has to be able to nurture several communities to create a thriving ecosystem.

For instance, large tech companies or startups, often rely on several communities:

• Programmers and developers ( Google , Apple ).
• Content creators and publishers ( Google , Quora, YouTube ).
• Artists and creative talents ( Apple , YouTube ).

In Apple ‘s case though, the first ecosystem is the community of developers building third-party software products that complement the company’s offering:

The Company also supports a community for the development of third-party software and hardware products and digital content that complement the Company’s offerings.

When you combine that with a high-touch strategy (where skilled and knowledgeable salespeople interact with customers) you create a flywheel, where customers are retained for longer, the brand grows as a result of this high-touch activity which creates a better post-sale experience and triggers word of mouth and referral from existing customers:

The Company believes a high-quality buying experience with knowledgeable salespersons who can convey the value of the Company’s products and services greatly enhances its ability to attract and retain customers.Therefore, the Company’s strategy also includes building and expanding its own retail and online stores and its third-party distribution network to effectively reach more customers and provide them with a high-quality sales and post-sales support experience.The Company believes ongoing investment in research and development (“R&D”), marketing and advertising is critical to the development and sale of innovative products, services and technologies.

Read : Apple Business Model

Airbnb Business Strategy

Business Model Essence : Peer-To-Peer House-Sharing Network With Fee-Based Monetization Strategy

As a peer-to-peer network, Airbnb allows individuals to rent from private owners for a fee.

Airbnb charges guests a service fee between 5% and 15% of the reservation subtotal; While the commission from hosts is generally 3%.

Airbnb also charges hosts who offer experiences a 20% service fee on the total price.

The digitalization that happened in the last two decades has facilitated the creation of peer-to-peer platforms in which business models disrupted the hospitality model created in the previous century by hotel chains like Marriott, Holiday Inn, and Hilton.

Airbnb is quickly branching out toward offering more experiences. We can call Airbnb the “marketplace of experiences.”

In short, just like Amazon started from books, Airbnb has started from house-sharing.

But that is the starting point, which gives the innovative company enough traction to validate its whole business model and expand to other areas.

The principal aim of Airbnb is to control the whole experience for its users. This means creating an end-to-end travel experience that embraces the entire process .

Thus, it’s not surprising that we’ll see Airbnb expanding its marketplace to more and more areas. This is also shown by the fact that Airbnb might soon offer bundled travel packages .

Just as we’ve seen in the case of Alibaba and Amazon , Airbnb follows a marketplace logic, where it needs to make the interactions between its key users (hosts and guests) as smooth as possible, with an emphasis on safety.

As a platform, Airbnb initially used a strategy of improving the quality of its supply by employing freelance photographers that could take pictures of host homes.

This, in turn, made those homes more interesting for guests, as they could appreciate those homes more.

As many people in real estate might know, the quality of the pictures is critical.

Although this might sound trivial, this is what improved the Airbnb supply side.

Indeed with better and professionally taken images, Airbnb improved its reach via search engines (yes, search engines are thirsty for fresh and original content, images comprised).

And it enhanced the experience of its potential customers.

Now Airbnb is converting its business model to digital experiences. In addition to changing the whole strategy.

Whereas Airbnb focused in the past on covering major cities across the world.

Changing travel habits made Airbnb focus on digital experiences and local, extra-metropolitan areas throughout the pandemic.

While, post-pandemic, as people travel for longer stays, the whole platform has been structured around these. 

Read : Airbnb Business Model

Baidu Business Strategy

Business Model Essence :  Online Marketing Free Services Advertising-Supported Revenue Model

Baidu makes money primarily via online marketing services (advertising). In fact, in 2017, Baidu made about $11.24 in online marketing services and a remaining almost $1.8 billion through other sources. According to Statista,

Baidu has an overall search market share of 73.8% of the Chinese market. Other sources of revenues comprise membership services of iQIYI (an innovative market-leading online entertainment service provider in China) and financial services.

At first sight, Baidu might seem the mirror image of Google , but in China.

However, this is a superficial view. While Baidu has followed in China a similar path to Google , it did take advantage of the fact that Google wasn’t available there, to build its dominant position.

Baidu also has a more efficient cost structure than Google. It had also introduced innovations in its search products (like voice search devices for kids) at a time when Google wasn’t there yet.

Read : Baidu Business Model

Baidu mission: two-pillar business strategy and value propositions acting as a glue for its key users/customers

In the past years, Baidu has followed an expansion business strategy focused on acquiring assets and companies that complemented its core business model .

As the leading Chinese search provider, in 2017, Baidu updated its mission to “ Baidu aims to make a complex world simpler through technology.”

This mission is achieved via a two-pillar strategy:

• Strengthening the mobile foundation (similar to Google’s mobile-first).
• And leading in artificial intelligence.

Baidu’s key partners comprise users, customers, Baidu union members, and content providers.

For each of those critical segments, Baidu has drafted a fundamental value proposition .

Thus, to generate a value chain that works for these stakeholders, Baidu has to balance it with a diversified value proposition :

• Users:  enjoying Baidu search experience want a search engine that gives them relevant results.
• Customers: with 775,000 active online marketing customers in 2017, consisting of SMEs, large domestic businesses, and multinational companies, distributed across retail and e-commerce, network service, medical and healthcare, franchise investment, financial services, education, online games, transportation, construction and decoration, and business services. Those businesses look for a trackable, and sustainable ROI for their paid advertising campaigns. By bidding on keywords, they can target specific audiences.
• Baidu Union Member: share revenues with Baidy by displaying banner ads on their sites in relevant spaces filled by the  Baidu search algorithm (think of it as Google’s AdSense Network ). Those publishers and sites can generate additional revenues and monetize their content without relying on complex infrastructure, that instead is employed by Baidu.
• Content Providers:  video copyright holders, app owners who list their apps on the Baidu app store, users who contribute their valuable and copyrighted content to Baidu products, and publishers. Those users get visibility or money in exchange for this content. Baidu has to make sure to allow those content providers to get in exchange for their work and creativity visibility and revenues.

Understanding how the value proposition for each player comes together is critical to understanding the business decisions a company like Baidu makes over time.

For instance, as Baidu (like Google ) moves more and more toward AI, the need to balance the value proposition for Baidu Union Members might fickle.

Booking Business Strategy

Business Model Essence :  House-Sharing Platform Leveraging On A Two-Sided Marketplace With A Commission-Based Revenue Model

Booking Holdings is the company that controls six main brands that comprise Booking.com, priceline.com, KAYAK, agoda.com, Rentalcars.com, and OpenTable. 

Over 76% of the company’s revenues in 2017 came primarily via travel reservations commissions and travel insurance fees.

Almost 17% came from merchant fees, and the remaining revenues came from advertising earned via KAYAK.

As a distribution strategy, the company spent over $4.5 billion on performance-based and brand advertising.

Read : Booking Business Model

Booking mission, value proposition, and key players

Booking’s mission is to “help people experience the world.” Booking does that via a few primary brands:

• Booking.com.
• priceline.com.
• Rentalcars.com.

The mission of helping people experience the world is executed via three primary value propositions delivered to consumers, travelers, and business partners:

• Consumers are provided what Booking calls “the best choices and prices at any time, in any place, on any device.”
• People and travelers can easily find, book, and experience their travel desires.
• Business partners (like Hotels featured on Booking.com) are provided with platforms, tools, and insights in exchange.

Boomedium-term term strategy is focused on:

• Leveraging technology to provide the best experience.
• Growing partnerships with travel service providers and restaurants.
• Investing in profitable and sustainable growth.

DuckDuckGo Business Strategy

Business Model Essence : Privacy-based Search Engine Built On Google’s Weakness With An affiliate-based Revenue Model

DuckDuckGo makes money in two simple ways: Advertising and Affiliate Marketing.

Advertising is shown based on the keywords typed into the search box. Affiliate revenues come from Amazon and eBay affiliate programs.

When users buy after getting on those sites through DuckDuckGo the company collects a small commission.

While this model might not sound that exciting. DuckDuckGo managed to grow quickly by leveraging Google’s primary weakness: users’ privacy. Where Google’s primary asset is made of users’ data. DuckDuckGo throws that data away on the fly:

It is important to remark that DuckDuckGo is still figuring out a business model that can make it sustainable in the long term.

Indeed, the company got a venture round of $10 million back in August 2018.

DuckDuckGo will be tweaking its business model in the coming years, to reach a “ business model /market fit.”

Read : DuckDuckGo Business Model

Read : DuckDuckGo Story

Google (Alphabet) Business Strategy

Business Model Essence :  Free Search Engine Distributed Across Hardware, Browsers, And Members’ Websites With An Hidden Revenue Generation Model

As of 2017, over ninety billion dollars, which consisted of 86% of Google ’s revenues came from advertising networks.

The remaining fraction (about 13%) came from Apps, Google Cloud, and Hardware. While a bit more than 1% came from bets like Access, Calico, CapitalG, GV, Nest, Verily, Waymo, and X.

Google business model is changing over the years.

Even though advertising is still its cash cow, Google has been diversifying its revenues in other areas. 

While in 2015 90% of Google’s revenues came from advertising, in 2017, advertising revenues represented 86%.

Other revenues grew from about 10% in 2015 to almost 13% in 2017.

Why did Google get there? And where is Google going next? To understand that you need to understand the “moonshot thinking.”

Read : Google Business Model

Read : Google Cost Structure

Read : Baidu vs. Google

Understanding Google’s moonshot thinking and a breakthrough approach to business

As highlighted in the Alphabet annual report for 2018:

Many companies get comfortable doing what they have always done, making only incremental changes. This incrementalism leads to irrelevance over time, especially in technology, where change tends to be revolutionary, not evolutionary. People thought we were crazy when we acquired YouTube and Android and when we launched Chrome, but those efforts have matured into major platforms for digital video and mobile devices and a safer, popular browser. We continue to look toward the future and continue to invest for the long-term. As we said in the original founders’ letter, we will not shy away from high-risk, high-reward projects that we believe in because they are the key to our long-term success.

Understanding the moonshot approach to business is critical to understanding where Google (now Alphabet) got where it is today, and where it’s headed next.

Since the first shareholders’ letter from Google’s founders, Brin and Page they highlighted that “ Google is not a conventional company. We do not intend to become one.”

Google has successfully built ecosystems that today drive

To understand where Google is going next, you need to look at the AI Economy , in which the tech giant is trying to lead the pack.

Whether or not it will be successful will highly depend on its ability to keep creating successful ecosystems, just as Google has done with Google Maps (you might not realize but Google Maps powers up quite a large number of applications) and Android.

At the time of this writing, Google is widely investing in other areas, such as:

• Voice search.
• AI and machine learning applications.
• Self-driving cars.
• And other bets.

If that is not sufficient Google has made several moves in different spaces, to keep its dominance on mobile, while moving toward voice search, like the investment in KaiOS, which business model is interesting as it finally allows an ecosystem to be built on top of cheap mobile devices in developing countries:

That is why Google keeps making “smaller bets in areas that might seem very speculative or even strange when compared to its current businesses.”

Those other bets made “just” $595 million to Google in 2018.

This represented 0.4% of Google ‘s overall revenues , compared to the over $136 billion coming from the other segments.

Google ‘s North Star is its mission of “ organizing the world’s information and making it universally accessible and useful.” 

Read : KaiOS Business Model

Let’s go through a few other tips for a successful business strategy. 

Problem-first approach

The customer-problem quadrant by LEANSTACK’s Ash Maurya is a great starting point to define and understand the problem, that as an entrepreneur you will going to solve. 

Indeed, a successful business is such, based on the market’s rewards for the entrepreneur’s ability to solve a problem.

Keep in mind that defining and understanding problems in the real world is one of the most difficult things (that is why entrepreneurship is so hard).

To properly stumble on the right definition of the problem you’re solving, there might be some fine-tuning going on, which in the business world we like to call product-market fit . 

Business engineering skills

Another key element is not to lose sight of the context you’re operating.

As such, analyzing that properly might require some business engineering skills . 

To simplify your life you can use the FourWeekMBA business analysis framework.

Don’t strategize on a piece of paper

Strategies always work well on a piece of paper.

Yet when execution comes suddenly we can realize all the drawbacks of that.

In very few, rare cases, a designed strategy will work as expected.

However, the reason we plan and strategize isn’t just to make things work as we’d like them to.

But to communicate a vision we have to those people (employees, customers, stakeholders) who will help us get there. 

That is why when we strategize it’s important not to lose sight of the essence of our strategy, which is the long-term vision we have for our business.

The rest is execution, practice, and a lot of experimentation!

The innovation loop

Innovation starts by tweaking, testing, and experimenting also in unexpected ways.

Often though, as a business strategy is documented after the fact, it seems as if it was all part of a plan. 

In most cases, the innovation loop starts by stumbling upon that thing that will have a great impact on your business.

Therefore, as an entrepreneur, you need to keep pushing on those models that worked out.

But also to be on the lookout for new ways of doing things. 

Barbell approach 

In a barbel approach we want to have a clear distinction between two domains: 

• Core business : on the core business side, where you have a consolidated strategy, and a business model that has proved to work, it’s important to be structured. This means having a clear culture, following given processes, and slowly evolving your business model. 
• New bets : as your business model will become outdated over time, and that might happen also very quickly, you need to be on the lookout for new opportunities emerging, also in new, completely unrelated business fields. 

For instance, a tech giant like Google, has a part of its business skewed toward a few bets it placed on industries that are completely unrelated to its core business (search).

Those bets are not contributing at all to its bottom line (only some of those bets are generating revenues but those are extremely marginal compared to the overall turnover of the company). 

However, those might turn out widely successful (or huge failures) in the years to come. 

Thus, with a barbell approach, we want to consolidate what we have. But also be open to what might be coming next!

Business Explorers

Strategic analysis thinking tools.

Strategic analysis is a process to understand the organization’s environment and competitive landscape to formulate informed business decisions , to plan for the organizational structure and long-term direction. Strategic planning is also useful to experiment with business model design and assess the fit with the long-term vision of the business.

Business model canvas

The business model canvas aims to provide a keen understanding of your business model to provide strategic insights about your customers, product/service, and financial structure;

so that you can make better business decisions.

Blitzscaling canvas

In this article, I’ll focus on the Blitzscaling business model canvas. This is a model based on the concept of Blitzscaling.

That is a particular process of massive growth under uncertainty, and that prioritizes speed over efficiency. It focuses on market domination to create a first-scaler advantage in a scenario of uncertainty.

Pretotyping

Pretotyping is a mixture of the words “pretend” and “prototype,” and it is a methodology used to validate business ideas to improve the chances of building a product or service that people want.

The pretotyping methodology comes from Alberto Savoia’s work summarized in the book “The Right It: Why So Many Ideas Fail and How to Make Sure Yours Succeed.”

This framework is a mixture of the words “pretend” and “prototype,” and it helps to answer such questions (about the product or service to build) as: Would I use it? How, how often, and when would I use it?

Would other people buy it? How much would they be willing to pay for it? How, how often, and when would they use it?

Value innovation and blue ocean strategy

A blue ocean is a strategy where the boundaries of existing markets are redefined, and new uncontested markets are created.

At its core, there is value innovation, for which uncontested markets are created, where competition is made irrelevant. And the cost-value trade-off is broken.

Thus, companies following a blue ocean strategy offer much more value at a lower cost for the end customers.

Growth hacking process

Growth hacking is a process of rapid experimentation, coupled with the understanding of the whole funnel, where marketing , product, data analysis, and engineering work together to achieve rapid growth.

The growth hacking process goes through four key stages analyzing, ideating, prioritizing, and testing.

Pirate metrics

Venture capitalist , Dave McClure, coined the acronym AARRR which is a simplified model that enables us to understand what metrics and channels to look at. At each stage of the users’ path toward becoming customers and referrers of a brand.

Engines of growth

In the Lean Startup, Eric Ries defined the engine of growth as “the mechanism that startups use to achieve sustainable growth.”

He described sustainable growth as following a simple rule, “new customers come from the actions of past customers.”

The three engines of growth are the sticky engine, the viral engine, and the paid engine. Each of those can be measured and tracked by a few key metrics, and it helps plan your strategic moves.

The RTVN model is a straightforward framework that can help you design a business model when you’re at the very early stage of figuring out what you need to make it succeed.

Sales cycle

A sales cycle is the process that your company takes to sell your services and products.

In simple words, it’s a series of steps that your sales reps need to go through with prospects that lead up to a closed sale.

Planning ahead of time the steps your sales team needs to take to close a big contract can help you grow the revenues for your business.

Comparable analysis

A comparable company analysis is a process that enables the identification of similar organizations to be used as a comparison to understand the business and financial performance of the target company.

To find comparables, you can look at two key profiles: the business and economic profiles.

From the comparable company analysis, it is possible to understand the competitive landscape of the target organization.

Porter’s five forces

Porter’s Five Forces is a model that helps organizations to gain a better understanding of their industries and competition.

It was published for the first time by Professor Michael Porter in his book “Competitive Strategy” in the 1980s.

The model breaks down industries and markets by analyzing them through five forces which you can use to have a first assessment of the market you’re in.

Porter’s Generic Strategies

Porter’s Value Chain

Porter’s Diamond Model

Bowman’s Strategy Clock

VMOST Analysis

Fishbone Diagram

GE McKinsey Matrix

VRIO Framework

3C Analysis

AIDA stands for attention, interest, desire, and action. This is a model that is used in marketing to describe the potential journey a customer might go through, before purchasing a product or service. The variation of the AIDA model is the CAB model and the AIDCAS model.

PESTEL analysis

The PESTEL analysis is a framework that can help marketers assess whether macro-economic factors are affecting an organization.

This is a critical step that helps organizations identify potential threats and weaknesses. That can be used in other frameworks such as SWOT or to gain a broader and better understanding of the overall marketing environment.

Technology adoption curve

The technology adoption curve is a model that goes through five stages. Each of those stages (innovators, early adopters, early majority, late majority, and laggard) has a specific psychographic that makes that group of people ready to adopt a tech product.

This simple concept can help you define the right target for your business strategy.

Business model essence

A Business Model Essence, according to FourWeekMBA, is a way to find the critical characteristics of any business to have a clear understanding of that business in a few sentences.

That can be used to analyze existing businesses. Or to draft your Business Model and keep a strategic and execution focus on the key elements to be implemented in the short-medium term.

FourWeekMBA business model framework

An effective business model has to focus on two dimensions: the people dimension and the financial dimension. The people dimension will allow you to build a product or service that is 10X better than existing ones and a solid brand.

The financial dimension will help you develop proper distribution channels by identifying the people that are willing to pay for your product or service and make it financially sustainable in the long run.

TAM, SAM, and SOM

Understanding your TAM, SAM and SOM can help you navigate the market you’re in and to have a laser focus on the market you can reach with your product and service.

Brand Building

Value Proposition Design

Product-Market Fit

Freemium Decision Model

Organizational Design And Structures

Speed-Reversibility Matrix

Minimum Viable Product

SWOT Analysis

Revenue Modeling

Business Experimentation

Business Analysis

Ansoff Matrix

Key takeaway

I hope that in this guide you learned the critical aspects related to business strategy, with an emphasis on the entrepreneurial world. If business strategy would only be an academic discipline disjoined from reality, that would still be an interesting domain, yet purely speculative.

However, as a business strategy can be used as a useful tool to leverage on to build companies, hopefully, this guide will help you out in navigating through the seemingly noisy and confusing business world, dominated by technology. As a last but critical caveat, there isn’t a single way toward building a successful business.

And oftentimes the way you choose to build a business is really up to you, how you want to impact a community of people and your vision for the future!

Other resources: 

• Types of Business Models You Need to Know
• What Is a Business Model Canvas? Business Model Canvas Explained
• Blitzscaling Business Model Innovation Canvas In A Nutshell
• What Is a Value Proposition? Value Proposition Canvas Explained
• What Is a Lean Startup Canvas? Lean Startup Canvas Explained
• How to Write a One-Page Business Plan
• How to Build a Great Business Plan According to Peter Thiel
• How To Create A Business Model
• What Is Business Model Innovation And Why It Matters
• What Is Blitzscaling And Why It Matters
• Business Model Vs. Business Plan: When And How To Use Them
• The Five Key Factors That Lead To Successful Tech Startups
• Business Model Tools for Small Businesses and Startups

Additional Business Strategy Tactics

Blue ocean player.

Blue Sea Player

Constructive Disruptor

Niche player

Blitzscaler

Continuous Blitzscaler

What is business strategy?

What are examples of business strategies.

Things like product differentiation, business model innovation, technological innovation, more capital for growth, can all be moats that organizations focus on to gain an edge. Depending on the context, industry, and scenario, a business strategy might be more or less effective; that is why testing and experimentation are critical elements.

Connected Strategy Frameworks

ADKAR Model

Business Model Canvas

Lean Startup Canvas

Blitzscaling Canvas

Blue Ocean Strategy

Business Analysis Framework

Balanced Scorecard

Blue Ocean Strategy 

GAP Analysis

GE McKinsey Model

McKinsey 7-S Model

McKinsey’s Seven Degrees

McKinsey Horizon Model

Porter’s Five Forces

Porter’s Value Chain Model

PESTEL Analysis

Scenario Planning

STEEPLE Analysis

FourWeekMBA Business Toolbox

Business Engineering

Tech Business Model Template

Web3 Business Model Template

Asymmetric Business Models

Business Competition

Technological Modeling

Transitional Business Models

Minimum Viable Audience

Business Scaling

Market Expansion Theory

Speed-Reversibility

Asymmetric Betting

Growth Matrix

Revenue Streams Matrix

Pricing Strategies

Other business resources:

• What Is Business Model Innovation
• What Is a Business Model
• What Is Business Strategy
• What is Blitzscaling
• What Is Market Segmentation
• What Is a Marketing Strategy
• What is Growth Hacking

More Resources

About The Author

Gennaro Cuofano

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How to Develop a Business Strategy: 6 Steps

• 25 Oct 2022

Business strategy can seem daunting, and for good reason: It can make or break an organization. Yet, developing a strong strategy doesn’t need to be overwhelming.

In the online course Business Strategy , Harvard Business School Professor Felix Oberholzer-Gee posits that strategy is simple. His secret? Focus on your organization’s value creation.

“Strategy often sounds like a lofty concept that only the most senior executives can develop,” Oberholzer-Gee says. “But actually, anyone can think and act strategically. It doesn’t need to be difficult; all you need is a proven framework.”

Here’s a breakdown of why business strategy is important, the basics of value-based strategy, and six steps for developing your own.

Why Do You Need a Business Strategy?

Business strategy is the development, alignment, and integration of an organization’s strategic initiatives to give it a competitive edge in the market. Devising a business strategy can ensure you have a clear plan for reaching organizational goals and continue to survive and thrive.

According to a study by Bridges Business Consultancy , 48 percent of organizations fail to meet half of their strategic targets and 85 percent fail to meet two-thirds, highlighting why dedication to the business strategy process is crucial.

One type of business strategy is called value-based strategy, which simplifies the process by leveraging the value stick framework to focus on the advantage your business creates.

Access your free e-book today.

What Is Value-Based Strategy?

Value-based strategy , also called value-based pricing, is a pricing method in which an organization relies on the perceived value of its goods and services to determine its pricing structure and resource allocation.

The value stick framework can be used to visualize how various factors impact each other and determine which initiatives to pursue to increase value for all parties.

The value stick has four factors:

• Willingness to pay (WTP) : The highest price a customer is willing to pay for your product or service
• Price : The amount customers have to pay for goods or services
• Cost : The amount a company spends on producing goods or services
• Willingness to sell (WTS) : The lowest amount suppliers are willing to accept for the materials required to produce goods or services

To determine how to best create value, you can toggle each factor on the value stick to see how the others are affected. For instance, lowering price increases customer delight.

"As strategists, we really ask three questions,” Oberholzer-Gee says in Business Strategy. “How can my business best create value for customers? How can my business create value for employees? And how can my business create value by collaborating with suppliers? Think of a company's strategy as an answer to these three questions."

Related: 4 Business Strategy Skills Every Business Leader Needs

6 Steps to Develop a Value-Based Business Strategy

1. define your purpose.

When approaching business strategy, defining your organization’s purpose can be a useful starting point.

This is vital in creating customer and employee value, especially if your organization’s purpose is linked to a cause such as environmental protection or alleviating specific social issues.

A recent survey conducted by clean energy company Swytch found that nearly 75 percent of millennials would take a decrease in salary if it meant working for an environmentally responsible company. Nearly 40 percent selected one job over another because of an organization’s sustainability practices.

Additionally, research in the Harvard Business Review shows that consumers’ motivation to buy from sustainable brands is on the rise. Sales of products marked as sustainable grew more than five times faster than those that weren’t.

By starting with purpose, your organization can create more value down the line.

2. Assess Market Opportunity

Next, understand your market’s competitive landscape. Which companies own shares of the market? What differentiates your competitors’ products from yours? Are there any unmet needs your organization could take advantage of?

Conducting this research before planning a strategy is critical in identifying how your organization provides unique customer value and opportunities to create even more.

3. Create Value for Customers

With an understanding of the market and your company’s purpose, you can determine how your organization provides unique or greater value and strategize ways to improve.

On the value stick, the value captured by customers is called “customer delight.” It can be increased by raising their willingness to pay and decreasing the product’s price. If lowering the price isn’t an option, brainstorm how you could make the product more valuable to customers, thus increasing their willingness to pay.

Some ways to create customer value include:

• Lowering the product’s price
• Increasing the product’s physical quality and longevity
• Providing quick, high-quality customer service and a smooth shopping experience
• Leveraging network effects , if applicable, to create a community of users
• Incorporating an environmental or social cause into processes, packaging, and branding

4. Create Value for Suppliers

In addition to creating value for customers, you also need to provide value for suppliers. Suppliers can include any company that provides raw materials, labor, and transportation to help your organization produce goods or deliver services.

Supplier surplus, also called supplier delight, is created when the cost of materials increases or their willingness to sell decreases. The relationship between a firm and its suppliers can be contentious, given that both want to increase their margins. Yet, there are ways to create value for both parties.

Some ways to create value for suppliers include:

• Agreeing to pay more for higher quality materials : While this increases the supplier surplus, it may also increase customer delight by raising willingness to pay, or increase the firm’s margin by allowing you to raise prices.
• Working with the supplier to increase efficiency : This strategy can increase supplier surplus by lowering the overall cost of the supplier’s labor and their willingness to sell.

5. Create Value for Employees

Creating value for employees is a critical part of an effective business strategy and can be assessed using the value stick. Think of your employees as the “supplier” of labor and the supplier margin as employee satisfaction.

Employee satisfaction can be increased by raising wages or lowering the minimum salary they’re willing to receive by delivering value in other ways. Satisfied employees may provide a better customer experience, resulting in increased customer delight.

The value you provide employees ensures they’re motivated to do their best work, develop their skills, and stay with your company long-term.

Some examples of ways to create value for your employees include:

• Offering competitive salaries and bonuses
• Offering benefits like ample paid vacation and sick days, generous parental leave, and wellness budgets
• Providing flexibility of work location, whether your team is fully remote or hybrid
• Aiding in professional development
• Creating a workplace rich with a diversity of experiences, identities, and ideas
• Fostering a supportive organizational culture

One example from Business Strategy is that of a call center for a diagnostics company. The employees were being paid minimum wage and expressed that the analytical nature of their phone calls with customers warranted higher pay. They also expressed pain points about cumbersome tasks and work conditions.

When a pay increase was implemented for all employees, along with operational changes to make processes smoother, employee productivity increased to the point that it balanced out the higher cost of salaries.

Because the employees’ satisfaction increased, they also began providing better experiences on the phone with customers. This increased the customers’ willingness to pay, directly impacting customer delight.

6. Map Strategy to Actionable Tasks and KPIs

Amidst creating value for each of the three groups, don’t forget the fourth party that needs value: your company. By creating value for employees, suppliers, and customers, you’re creating value for your firm, too.

To ensure you’re tracking to goals, determine your key performance indicators, what metrics constitute success, and how you’ll report results over time. Then, break each of the above value-creation goals into action items. For instance, what steps can you take to increase your employees’ compensation? Who will be responsible for each task?

Having actionable assignments and clear metrics for success will allow for a smooth transition from strategy formulation to execution.

Building Your Strategic Skill Set

By leveraging the value stick, you can create a business strategy that provides value to employees, customers, suppliers, and your firm.

To develop your strategies further and dig deeper into how to navigate value creation, consider taking an online course like Business Strategy . Professor Oberholzer-Gee walks through real-world examples of business challenges, prompts you to consider how you’d create value, and then reveals what those business leaders did and how you can apply the lessons to your organization.

Want to learn more about how to craft a successful strategy for your organization? Explore Business Strategy , one of our online strategy courses , to learn how to create organizational value. Not sure which course is the right fit? Download our free flowchart .

About the Author

The 7 Best Business Strategy Examples I've Ever Seen

Most entrepreneurs dream of an innovative product or service that surprises their rivals and takes new markets by storm. What they tend to forget is that there needs to be an excellent business strategy accompanying the product. 

I get it - it’s not nearly as interesting to fantasize about a competitive strategy. Yet without it, even genius products can quickly drown in the harsh business sea. Most strategies fail. A sobering 9 out of 10 organizations fail to execute their strategy.

I’ve already written about the 5 worst business strategy examples of all time and why many strategies fail . But today, we’ll flip the script and take a look at products and strategies that delighted their target customers and wildly exceeded initial business goals.

From Tesla, Airbnb, and Toyota to Hubspot, Apple, and Paypal - let’s dive into their business strategies and see why these 7 are the best ones I’ve ever seen:

• Tesla - Playing the long game
• Airbnb - Forgetting all about scalability
• Toyota - Humility can be the best business strategy
• HubSpot - Creating an industry then dominating it
• Apple - iPhone launch shows tremendous restraint
• PayPal - Daring to challenge the status quo
• Spotify - Changing the rules of the music industry

But before we get into these business strategy examples, let's briefly go over some of the basics...

What is a business strategy?

A business strategy , also known as a company strategy, is a crucial aspect of running a successful business. It is a defined plan of action that outlines the direction a business wants to take and defines how the plan will cascade through the organization by the allocation of resources. The importance of a business strategy cannot be overstated as it sets the direction for the entire organization and helps to align all employees towards a common goal . Overall, a business strategy serves as a roadmap for a company, guiding its actions and decisions to achieve its goals and stay competitive in the marketplace. 

👉 If you have any unanswered questions about business strategies, check our FAQs at the end of this article! 

🎁 Struggling to build your Business Strategy? Use our free customizable  Business Strategy Template to easily develop and execute it!

Best business strategies #1: Tesla Playing the long game

Conventional business logic is that when you're starting something new, you create a 'Minimal Viable Product' or MVP.

Essentially that means that you make a version of your product that is very light in terms of functionality and focuses mostly on showcasing your main competitive advantage.

It also means that the first version of your product usually has to be sold at a reasonably low starting price to compensate for its lack of features and generate interest.

Some organizations (including many tech startups) take this concept even further and base their growth strategy around a freemium pricing model . In this business model, the most basic version of the product or service is free, but any new or upgraded features cost money. 

Tesla, on the other hand, did things the other way around. It's been known for a long time that Tesla's long-term goal is to be the biggest car company in the world. They know that in order to become the biggest by volume, they're going to have to succeed in the lower-end consumer car space (price tag US$30,000 or less).

But Tesla did not focus on this market first. It did not create a cheap low-featured version of their electric car (and therefore benefit from economies of scale ).

Instead, Tesla created the most luxurious, expensive, fully-featured sports car they could afford. That car was the Tesla Roadster, and for context, the newest generation of the Roadster will retail from upwards of US$200,000 for the base model. 

This was the first car they ever produced - knowing that they couldn't achieve the necessary scale or efficiency to turn a profit (even at such a high price). However, such a car was in-line with Tesla’s vision statement where they aim “to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles.”

Fast-forward to today, and Tesla dwarfs the competition as the most valuable car company in the world. So their differentiation strategy certainly seems to be working, but why?

What can we learn from Tesla?

The first thing to note is that Tesla has made incredible progress towards its business objective of mass-produced, affordable electric cars. They've even made a genuine annual profit for the first time in their history. 

Secondly, much of Tesla's business strategy was actually forced upon it. There was no way they could have created a cost-effective mass-market electric car.

As a startup, they didn’t have the resources or capabilities to reap the benefits of economies of scale. Because they were creating such a unique car, they couldn't rely on outsourcing or suppliers to gain mass-production benefits.

Fortunately, Tesla's supply chain strategy is one of the most brilliant moves they've made. They knew early on that batteries would present the biggest technological hurdle to their cars and the biggest bottleneck to production.

Rather than let this derail them, they took complete control of their supply chain by investing in battery manufacturers. This has the additional benefit of simplifying diversification as Tesla can use those same batteries in parallel business ventures such as their Powerwall.

Of course, Tesla’s business strategy required vast capital and fundraising (Elon is rich but not quite rich enough to fund it all himself). That's where the marketing genius of Tesla kicks in. 

For the most part, their marketing efforts are only partially about their cars. Tesla is seen as Elon Musk's personal brand, and that had an enormous impact on whether or not they got the investment they needed.

He's smart, divisive, wild, and ambitious. But whatever you think about Elon Musk, you'd be hard-pressed to traverse more than a couple of consecutive news cycles without seeing him on the front page. And that's a fantastic recipe for getting the attention of investors.

Tesla studied and adapted to the industry and business environment they would operate in. They knew their strengths, understood their market position, and built their strategy around their own findings instead of following conventional wisdom.

👉 Use the Tesla Strategy Plan Template to get inspired by Tesla's Strategy to build your own!

📚Learn more about Tesla in our Strategy Study: How Tesla Became The World’s Most Valuable Automotive Company.

Best business strategies #2: Airbnb Forgetting all about scalability

Airbnb is one of the fastest-growing tech companies. Shortly after their IPO in December 2020, they reached a US$100B+ valuation, and the company has quite possibly changed the way we travel forever. But did you know they started out about as low-tech as you can get?

It all began with co-founders Brian and Joe renting out 3 air mattresses on their apartment’s floor. They made $80 per guest. It seemed like a great idea for a startup, so they launched a website and invited other people to list their own mattresses for hire.

They got a few bookings here and there, but things didn't go well for the most part. So much so that in 2008, they resorted to selling cereal to make ends meet.

They had plenty of listings on the site and plenty of site traffic. Potential customers were out there, but they weren’t making enough bookings.

They identified the most likely problem - the low quality of listings that were simply not enticing. So Brian and Joe decided to take matters into their own hands.

The co-founders grabbed their cameras and visited every one of their NYC listings. They persuaded the owners to let them take a ton of photographs of their places.

They touched them up a bit and uploaded them to the website, replacing the old, usually bad photos. Within a month of starting this strategy, sales doubled. Then tripled. The rest is history.

What can we learn from Airbnb?

The thing I love the most about this story is that it opposes one of the most commonly stated principles of building a tech startup - “everything must be scalable” .

What Brian and Joe did was anything but scalable. But it got them enough traction to prove that their concept could work. 

Later, they did scale their initial solution by hiring young photographers in major locations and paying them to take professional photos of owners’ listings (at no charge to the owner).

They also added a bunch of guidelines and articles on the site to educate owners on how they can make more money by taking better photos.

Airbnb's story shows that business strategies don’t have to be grand and super long-term affairs.

They can revolve around a specific challenge preventing the business from taking off. Once the challenge is solved, the company progresses on its roadmap and integrates the solution into the revamped business strategy.

Source: Airbnb third quarter 2022 financial results

👉 Use the Airbnb Strategy Plan Template to get inspired by Airbnb's Strategy to build your own!

Best business strategies #3: Toyota Humility can be the best business strategy

In 1973, the 'Big Three' car makers in the USA had over 82% of the market share. Today they have less than 50%. Why? Because of the aggressive (and unexpected) entry of Japanese carmakers into the US market in the 1970s - led by Toyota.

Cars are big, heavy, and expensive to ship around in large numbers. That's one of the reasons the US market was caught off guard when Toyota started selling Japanese-made cars in the US at lower prices than they could match.

The car industry was a huge contributor to the US economy, so one of the first reactions from the government was the implementation of protectionist taxes on all imported cars - thus making Japanese cars as expensive as locally made cars.

But the tactic failed. Within a few years, Toyota had managed to establish production on US soil, thus eliminating the need to pay any of the hefty new import taxes. At first, US carmakers weren't all that worried.

Surely by having to move production to the US, the costs for the Japanese carmakers would be roughly the same as those of the local car companies. 

Well, that didn't happen. Toyota continued its cost leadership strategy. It still manufactured cars for significantly less money than US companies could.

Their finely honed production processes were so efficient and lean that they could beat US carmakers at their own game. You've probably heard of the notion of ' continuous improvement '. In manufacturing, Toyota is pretty much synonymous with the term.

US Car Sales Graph- January through May 2021 vs 2020

Source: GOODCARBADCAR

What can we learn from Toyota?

Most business success stories involve bold moves and daring ideas. But not this one. 

Toyota spent years studying the production lines of American carmakers such as Ford. They knew that the US car industry was more advanced and efficient than the Japanese industry. So they decided to be patient.

They studied their competitors and tried to copy what the Americans did so well. They blended these processes with their strengths and came up with something even better.

Toyota proved that knowing one's weaknesses can be the key to success - and be one of the best business strategies you can ever deploy.

Not just that. Can you name a single famous executive at Toyota? I can't. And one of the reasons is that Toyota's number one corporate value is humility. It helped them crack the US market, and it runs deep in the organization - from top management to assembly workers.

Toyota’s success is based on continuously improving its functional level strategy , which focuses on day-to-day operations , decisions, and goals. They understood that the bigger picture consists of thousands of small tasks and employees.

They took a big goal, such as “becoming a cost leader in our category without compromising quality”, and ensured that their mission impacted every level of the organization while staying true to their core values.

👉 Use the Toyota Strategy Plan Template to get inspired by Toyota's Strategy to build your own!

📚Learn more about Toyota in our Strategy Study: How Toyota Went From Humble Beginnings To Automotive Giant .

Best business strategies #4: HubSpot Creating an industry then dominating it

HubSpot might not be as famous as Airbnb or Toyota. However, being valued at $22.72 billion in 2022 means, they’re certainly no slouch.

And most impressively, they’ve become such a successful company in an industry that didn’t even exist before they invented it.

Most of the marketing we experience is known as 'interruption' marketing. This is where adverts are pushed out to you whether you like it or not. Think tv adverts, billboards, Google Adwords, etc. 

In 2004, HubSpot created a software platform that aimed to turn this marketing concept on its head. The HubSpot marketing platform helped companies write blog posts, create eBooks, and share their content on social media.

The theory was that if you could produce enough good quality content to pull people to your website, then enough of them might stick around to take a look at the product you're actually selling. Useful content created specifically for your target market should also increase customer retention.

This approach was a big deal. I can tell you from personal experience that 'interruption marketing' is really expensive. We pay Google around $10 each time someone clicks on one of our AdWords adverts. Remember, that's $10 per click, not per sale. It adds up pretty fast.

On the other hand, this blog receives more than one million clicks per year. Each article keeps generating clicks at no additional costs once it’s written and published. 

Inbound marketing basically saved our business - so it's fair to say that this example is pretty close to my heart!

Hubspot coined the term 'inbound marketing' - and long story short, they're now one of the biggest SaaS companies in the world. But that's not the interesting part of the story.

What can we learn from HubSpot?

Hubspot’s successful business strategy is based on a new type of marketing. Now here’s the twist that separates it from generic strategies: Hubspot used their new marketing approach to market their own company, whose sole purpose was to sell a platform that created that new type of marketing. Head hurting yet? Mine too.

Most companies would have taken that new approach and applied it to something they were already selling. But instead, the HubSpot guys decided to monetize the marketing strategy itself. 

They took a whole bunch of concepts that already existed (blogging, eBooks, etc.) and packaged them into an innovative product - ‘a new way of doing things'. 

They created an awesome narrative and proved how powerful their new way of marketing could be by building a business worth billions around it. 

Their best and biggest case study was their own product, and they had all the numbers and little details to showcase to the world it really works.

Source: Hubspot overview

👉 Use the Hubspot Strategy Plan Template to get inspired by Hubspot's Strategy to build your own!

Best business strategies #5: Apple iPhone launch shows tremendous restraint

Ok, I hear you - this is such an obvious inclusion for the 'best business strategies'. But as one of the first people to adopt smartphones when they came out in the 1990s, this is something else that's close to my heart. 

I remember using Windows Mobile (the original version ) on a touchscreen phone with a stylus - and it was horrible. I loved the fact that I had access to my email and my calendar on my phone.

But I hated that my phone was the size of a house and required you to press the screen with ox-like strength before any kind of input would register.

Thankfully, a few years later, BlackBerry came along and started to release phones that were not only smart but much more usable. Sony Ericsson, Nokia, HTC, and a whole host of other manufacturers came out with reasonably solid smartphones well before 2007 when Apple finally released the iPhone.

I remember arriving at the office one day, and my boss had somehow gotten his hands on one of the first iPhones to be sold in the UK. I was shocked. Normally I was the early adopter. I was the one showing people what the future looked like.

And yet, here was this guy in his mid 50's, with his thick glasses, showing off a bit of technology that I'd never even seen before.

Apple could easily have created a phone much earlier than it did and sold it to me and a few other early adopters.

But it didn't. Instead, it waited until the technology was mature enough to sell it to my boss - someone who is far less tech-savvy than me. But also far more financially equipped to spend plenty of money on new tech products.

What can we learn from Apple?

The big learning here is that first-mover advantage is often not an advantage. A well-executed 'follower' strategy will outperform a less well-executed 'first mover' strategy every single time. 

One of the most common misconceptions in the startup world is that it's the 'idea' that matters the most. The truth is, the world's most successful companies were rarely the original innovators. I'm looking at you, Nokia. At you, Kodak. And at you as well, Yahoo.

In fact, being first is probably a disadvantage more often than it's an advantage. Why?

• Your market isn't well defined and doesn't even know your product type exists.
• If you have a market, it's probably just the early adopters - by definition, that's a niche market.
• Technology will often hold you back rather than power you to success.
• Every business that comes after you will have the advantage of learning from your mistakes.

People, and especially tech companies, get carried away with being first and forget that it’s a competitive position with pros and cons. Deciding to be a 'first mover' or 'smart follower' is crucial for strategic planning .

It’s a decision that should be based on research such as swot analysis and not on pride or blind optimism as it can make all the difference between success and failure.

Bonus reading : 18 Free Strategic Plan Templates (Excel & Cascade)

👉 Use the Apple Strategy Plan Template to get inspired by Apple's Strategy to build your own!

📚Learn more about Apple in our Strategy Study: How Apple Became the Top Non-Corporate Tech Brand .

Best business strategies #6: PayPal Daring to challenge the status quo

There are certain industries that you just don't mess with. Industries like aerospace, big supermarkets, semiconductors, and banking. Actually, banking is probably the toughest industry to try to disrupt because the barrier to entry is huge.

You need mountains of capital, a ton of regulatory approval, and years of building trust with your customers around their most important asset - cash.

Banks are old. Their business models have been essentially unchanged for hundreds of years. They're insanely powerful and almost impossible to displace. But for some crazy reason - PayPal didn't seem to care.

I can tell you from personal experience (I worked for a bank) that the name which strikes the most fear into the executives of the banks is PayPal.

Here's why:

• PayPal spends less money on technology than even a medium-sized bank does. Yet its technology platform is far superior.
• Consumers trust PayPal as much if not more than they trust their bank. Even though PayPal has been around for a fraction of the time.
• When a customer uses their PayPal account, the bank has no clue what the customer bought. The transaction appears on the bank statement as merely 'PayPal'. That gives PayPal all the power when it comes to data mining.
• PayPal is quicker to market with just about any kind of payment innovation.
• PayPal refuses to partner with banks - instead opting to partner with retailers directly.

In a very short time, PayPal has emerged as a new payment method - giving a very real alternative to your trusty debit or credit card. PayPal has also become one of the best payment platforms for digital nomads , tapping into one of the fastest-growing business trends in the world.

But how the heck did it manage to do it? Let's take a look at why PayPal had one of the best business strategies ever.

What can we learn from PayPal?

There are two main reasons behind PayPal's success story. 

The first is simple - stone-cold balls. They got a fairly lucky break when they accidentally became the favored payment provider for eBay transactions. A few years later, Paypal was even acquired by eBay for US$1.5bn.

eBay was smart enough to mostly leave Paypal alone, and their newfound sense of boldness saw them strike a series of deals with other online retailers to try and replicate the success they'd had with eBay.

This is where the second reason comes in. Partnerships. Banks had always been wary about forming partnerships with retailers directly. Instead, they relied on their scheme partners (Visa / MasterCard) to do it for them.

They didn't want the hassle of managing so many different relationships and were extremely confident that credit and debit cards would always be at the heart of the payment system. But the problem was that MasterCard was already working on a partnership with PayPal. 

Today, PayPal commends an amazing 54% share of the payment processing market. Almost all of that growth has come from their direct relationships with large and small merchants.

It shows that even in the toughest and most competitive markets, you can still find opportunities worth exploring and uncover a key to a very good business strategy.

Market share of online payment processing software technologies worldwide Sep 2022. Source: Statista

👉 Use the PayPal Strategy Plan Template to get inspired by Paypal's Strategy to build your own!

Best business strategies #7: Spotify Changing the rules of the music industry

Before Spotify came along, the world of online music streaming was pretty lackluster. Sure, you had platforms like Napster and The Pirate Bay, but they were illegal and you never knew when they would get shut down. And even if you did use them, you were still pretty limited in terms of what you could listen to. On the other hand, you had platforms like iTunes and Pandora, but they had their own set of problems. With iTunes, you had to pay for each and every song, which was a total bummer. And Pandora, you couldn't listen to whatever song you wanted, it was more like a radio station. Basically, people were craving for a better way to listen to music, one that was legal and gave them the freedom to choose what they wanted to listen to. And that's where Spotify comes in. When Spotify launched in 2008, it was a game-changer. They took the best parts of platforms like Napster and The Pirate Bay (the ability to share music), but made it legal. And they also took the best parts of platforms like iTunes and Pandora (the ability to choose what you want to listen to), and made it better. As we all know, it turned out to be quite an effective business strategy.

What can we learn from Spotify?

Spotify nailed it by putting their customers at the forefront of their business strategy. They saw that people were fed up with the limitations of other music streaming platforms and decided to create a service that put the customer's needs and wants first. They invested in technology and engineers to ensure the experience was seamless and easy for listeners, and it worked like a charm. People flocked to Spotify like bees to honey because it gave them the freedom and control over their music choices that they craved. Another big part of Spotify's success was (and still is) their freemium business model. They offered a free version of the service, but also had premium options for those who wanted more features and services. This allowed them to attract a huge user base and generate revenue from both the free and paying users. This model helped Spotify grow its user base and revenue quickly, more than exceeding their business goals.

And let's not forget about their data-driven approach. They invested heavily in data analysis and machine learning, which allowed them to create algorithms to predict which songs and artists users will like and recommend them accordingly - going one step further into user personalization. This helped to drive engagement and loyalty, making Spotify the go-to platform for discovering new music and creating playlists.

👉 Use the Spotify Strategy Plan Template to get inspired by Spotify's Strategy to build your own!

📚Learn more about Spotify in our Strategy Study: How Spotify Became The Standard In Convenience And Accessibility .

More excellent business strategy examples

You just got familiar with my personal selection of top business strategies. But these 7 are just the tip of the iceberg! If you’re looking for more examples and lessons from the very best businesses in the world, download the free 56 strategies report . It’s a selection of cases that covers plenty of really interesting situations. Trust me, you won’t regret it.

What's the difference between a business strategy and a corporate strategy?

A business strategy refers to the business plan for a specific business unit level within a company, while a corporate strategy deals with the overall direction and scope of the entire organization at the functional level.

A successful business strategy focuses on achieving specific business objectives within a certain market or industry, and is often developed as part of a larger business plan. While a corporate-level strategy focuses on achieving corporate objectives and aligning the entire organization's key components to achieve competitive advantage and meet organizational goals.

What are the key components of a successful business strategy?

A successful business strategy includes the following key components:

• Identifying and targeting a specific market or industry
• Developing a unique value proposition
• Creating a business plan with relevant focus areas to achieve the business objectives
• Define the specific actions that will ensure those objectives are met
• Determine the measures or KPIs that will drive success and ensure execution
• Continuously monitoring and adjusting the strategy to meet the organizational goals

How does a business strategy contribute to achieving corporate objectives?

A business strategy is designed to achieve specific business objectives within a certain market or industry, which in turn contributes to achieving the overall corporate objectives of the organization .

By aligning the efforts of the individual business units with the overall direction and scope of the company, a business strategy helps to create a unified approach towards achieving competitive advantage and meeting organizational goals.

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What is strategic planning? A 5-step guide

Strategic planning is a process through which business leaders map out their vision for their organization’s growth and how they’re going to get there. In this article, we'll guide you through the strategic planning process, including why it's important, the benefits and best practices, and five steps to get you from beginning to end.

Strategic planning is a process through which business leaders map out their vision for their organization’s growth and how they’re going to get there. The strategic planning process informs your organization’s decisions, growth, and goals.

Strategic planning helps you clearly define your company’s long-term objectives—and maps how your short-term goals and work will help you achieve them. This, in turn, gives you a clear sense of where your organization is going and allows you to ensure your teams are working on projects that make the most impact. Think of it this way—if your goals and objectives are your destination on a map, your strategic plan is your navigation system.

In this article, we walk you through the 5-step strategic planning process and show you how to get started developing your own strategic plan.

How to build an organizational strategy

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What is strategic planning?

Strategic planning is a business process that helps you define and share the direction your company will take in the next three to five years. During the strategic planning process, stakeholders review and define the organization’s mission and goals, conduct competitive assessments, and identify company goals and objectives. The product of the planning cycle is a strategic plan, which is shared throughout the company.

What is a strategic plan?

A strategic plan is the end result of the strategic planning process. At its most basic, it’s a tool used to define your organization’s goals and what actions you’ll take to achieve them.

Typically, your strategic plan should include: 

Your company’s mission statement

Your organizational goals, including your long-term goals and short-term, yearly objectives

Any plan of action, tactics, or approaches you plan to take to meet those goals

What are the benefits of strategic planning?

Strategic planning can help with goal setting and decision-making by allowing you to map out how your company will move toward your organization’s vision and mission statements in the next three to five years. Let’s circle back to our map metaphor. If you think of your company trajectory as a line on a map, a strategic plan can help you better quantify how you’ll get from point A (where you are now) to point B (where you want to be in a few years).

When you create and share a clear strategic plan with your team, you can:

Build a strong organizational culture by clearly defining and aligning on your organization’s mission, vision, and goals.

Align everyone around a shared purpose and ensure all departments and teams are working toward a common objective.

Proactively set objectives to help you get where you want to go and achieve desired outcomes.

Promote a long-term vision for your company rather than focusing primarily on short-term gains.

Ensure resources are allocated around the most high-impact priorities.

Define long-term goals and set shorter-term goals to support them.

Assess your current situation and identify any opportunities—or threats—allowing your organization to mitigate potential risks.

Create a proactive business culture that enables your organization to respond more swiftly to emerging market changes and opportunities.

What are the 5 steps in strategic planning?

The strategic planning process involves a structured methodology that guides the organization from vision to implementation. The strategic planning process starts with assembling a small, dedicated team of key strategic planners—typically five to 10 members—who will form the strategic planning, or management, committee. This team is responsible for gathering crucial information, guiding the development of the plan, and overseeing strategy execution.

Once you’ve established your management committee, you can get to work on the planning process. 

Step 1: Assess your current business strategy and business environment

Before you can define where you’re going, you first need to define where you are. Understanding the external environment, including market trends and competitive landscape, is crucial in the initial assessment phase of strategic planning.

To do this, your management committee should collect a variety of information from additional stakeholders, like employees and customers. In particular, plan to gather:

Relevant industry and market data to inform any market opportunities, as well as any potential upcoming threats in the near future.

Customer insights to understand what your customers want from your company—like product improvements or additional services.

Employee feedback that needs to be addressed—whether about the product, business practices, or the day-to-day company culture.

Consider different types of strategic planning tools and analytical techniques to gather this information, such as:

A balanced scorecard to help you evaluate four major elements of a business: learning and growth, business processes, customer satisfaction, and financial performance.

A SWOT analysis to help you assess both current and future potential for the business (you’ll return to this analysis periodically during the strategic planning process). 

To fill out each letter in the SWOT acronym, your management committee will answer a series of questions:

What does your organization currently do well?

What separates you from your competitors?

What are your most valuable internal resources?

What tangible assets do you have?

What is your biggest strength? 

Weaknesses:

What does your organization do poorly?

What do you currently lack (whether that’s a product, resource, or process)?

What do your competitors do better than you?

What, if any, limitations are holding your organization back?

What processes or products need improvement? 

Opportunities:

What opportunities does your organization have?

How can you leverage your unique company strengths?

Are there any trends that you can take advantage of?

How can you capitalize on marketing or press opportunities?

Is there an emerging need for your product or service? 

What emerging competitors should you keep an eye on?

Are there any weaknesses that expose your organization to risk?

Have you or could you experience negative press that could reduce market share?

Is there a chance of changing customer attitudes towards your company? 

Step 2: Identify your company’s goals and objectives

To begin strategy development, take into account your current position, which is where you are now. Then, draw inspiration from your vision, mission, and current position to identify and define your goals—these are your final destination. 

To develop your strategy, you’re essentially pulling out your compass and asking, “Where are we going next?” “What’s the ideal future state of this company?” This can help you figure out which path you need to take to get there.

During this phase of the planning process, take inspiration from important company documents, such as:

Your mission statement, to understand how you can continue moving towards your organization’s core purpose.

Your vision statement, to clarify how your strategic plan fits into your long-term vision.

Your company values, to guide you towards what matters most towards your company.

Your competitive advantages, to understand what unique benefit you offer to the market.

Your long-term goals, to track where you want to be in five or 10 years.

Your financial forecast and projection, to understand where you expect your financials to be in the next three years, what your expected cash flow is, and what new opportunities you will likely be able to invest in.

Step 3: Develop your strategic plan and determine performance metrics

Now that you understand where you are and where you want to go, it’s time to put pen to paper. Take your current business position and strategy into account, as well as your organization’s goals and objectives, and build out a strategic plan for the next three to five years. Keep in mind that even though you’re creating a long-term plan, parts of your plan should be created or revisited as the quarters and years go on.

As you build your strategic plan, you should define:

Company priorities for the next three to five years, based on your SWOT analysis and strategy.

Yearly objectives for the first year. You don’t need to define your objectives for every year of the strategic plan. As the years go on, create new yearly objectives that connect back to your overall strategic goals . 

Related key results and KPIs. Some of these should be set by the management committee, and some should be set by specific teams that are closer to the work. Make sure your key results and KPIs are measurable and actionable. These KPIs will help you track progress and ensure you’re moving in the right direction.

Budget for the next year or few years. This should be based on your financial forecast as well as your direction. Do you need to spend aggressively to develop your product? Build your team? Make a dent with marketing? Clarify your most important initiatives and how you’ll budget for those.

A high-level project roadmap . A project roadmap is a tool in project management that helps you visualize the timeline of a complex initiative, but you can also create a very high-level project roadmap for your strategic plan. Outline what you expect to be working on in certain quarters or years to make the plan more actionable and understandable.

Step 4: Implement and share your plan

Now it’s time to put your plan into action. Strategy implementation involves clear communication across your entire organization to make sure everyone knows their responsibilities and how to measure the plan’s success. 

Make sure your team (especially senior leadership) has access to the strategic plan, so they can understand how their work contributes to company priorities and the overall strategy map. We recommend sharing your plan in the same tool you use to manage and track work, so you can more easily connect high-level objectives to daily work. If you don’t already, consider using a work management platform .  

A few tips to make sure your plan will be executed without a hitch: 

Communicate clearly to your entire organization throughout the implementation process, to ensure all team members understand the strategic plan and how to implement it effectively. 

Define what “success” looks like by mapping your strategic plan to key performance indicators.

Ensure that the actions outlined in the strategic plan are integrated into the daily operations of the organization, so that every team member's daily activities are aligned with the broader strategic objectives.

Utilize tools and software—like a work management platform—that can aid in implementing and tracking the progress of your plan.

Regularly monitor and share the progress of the strategic plan with the entire organization, to keep everyone informed and reinforce the importance of the plan.

Establish regular check-ins to monitor the progress of your strategic plan and make adjustments as needed. 

Step 5: Revise and restructure as needed

Once you’ve created and implemented your new strategic framework, the final step of the planning process is to monitor and manage your plan.

Remember, your strategic plan isn’t set in stone. You’ll need to revisit and update the plan if your company changes directions or makes new investments. As new market opportunities and threats come up, you’ll likely want to tweak your strategic plan. Make sure to review your plan regularly—meaning quarterly and annually—to ensure it’s still aligned with your organization’s vision and goals.

Keep in mind that your plan won’t last forever, even if you do update it frequently. A successful strategic plan evolves with your company’s long-term goals. When you’ve achieved most of your strategic goals, or if your strategy has evolved significantly since you first made your plan, it might be time to create a new one.

Build a smarter strategic plan with a work management platform

To turn your company strategy into a plan—and ultimately, impact—make sure you’re proactively connecting company objectives to daily work. When you can clarify this connection, you’re giving your team members the context they need to get their best work done. 

A work management platform plays a pivotal role in this process. It acts as a central hub for your strategic plan, ensuring that every task and project is directly tied to your broader company goals. This alignment is crucial for visibility and coordination, allowing team members to see how their individual efforts contribute to the company’s success. 

By leveraging such a platform, you not only streamline workflow and enhance team productivity but also align every action with your strategic objectives—allowing teams to drive greater impact and helping your company move toward goals more effectively. 

Strategic planning FAQs

Still have questions about strategic planning? We have answers.

Why do I need a strategic plan?

A strategic plan is one of many tools you can use to plan and hit your goals. It helps map out strategic objectives and growth metrics that will help your company be successful.

When should I create a strategic plan?

You should aim to create a strategic plan every three to five years, depending on your organization’s growth speed.

Since the point of a strategic plan is to map out your long-term goals and how you’ll get there, you should create a strategic plan when you’ve met most or all of them. You should also create a strategic plan any time you’re going to make a large pivot in your organization’s mission or enter new markets. 

What is a strategic planning template?

A strategic planning template is a tool organizations can use to map out their strategic plan and track progress. Typically, a strategic planning template houses all the components needed to build out a strategic plan, including your company’s vision and mission statements, information from any competitive analyses or SWOT assessments, and relevant KPIs.

What’s the difference between a strategic plan vs. business plan?

A business plan can help you document your strategy as you’re getting started so every team member is on the same page about your core business priorities and goals. This tool can help you document and share your strategy with key investors or stakeholders as you get your business up and running.

You should create a business plan when you’re: 

Just starting your business

Significantly restructuring your business

If your business is already established, you should create a strategic plan instead of a business plan. Even if you’re working at a relatively young company, your strategic plan can build on your business plan to help you move in the right direction. During the strategic planning process, you’ll draw from a lot of the fundamental business elements you built early on to establish your strategy for the next three to five years.

What’s the difference between a strategic plan vs. mission and vision statements?

Your strategic plan, mission statement, and vision statements are all closely connected. In fact, during the strategic planning process, you will take inspiration from your mission and vision statements in order to build out your strategic plan.

Simply put: 

A mission statement summarizes your company’s purpose.

A vision statement broadly explains how you’ll reach your company’s purpose.

A strategic plan pulls in inspiration from your mission and vision statements and outlines what actions you’re going to take to move in the right direction. 

For example, if your company produces pet safety equipment, here’s how your mission statement, vision statement, and strategic plan might shake out:

Mission statement: “To ensure the safety of the world’s animals.” 

Vision statement: “To create pet safety and tracking products that are effortless to use.” 

Your strategic plan would outline the steps you’re going to take in the next few years to bring your company closer to your mission and vision. For example, you develop a new pet tracking smart collar or improve the microchipping experience for pet owners. 

What’s the difference between a strategic plan vs. company objectives?

Company objectives are broad goals. You should set these on a yearly or quarterly basis (if your organization moves quickly). These objectives give your team a clear sense of what you intend to accomplish for a set period of time. 

Your strategic plan is more forward-thinking than your company goals, and it should cover more than one year of work. Think of it this way: your company objectives will move the needle towards your overall strategy—but your strategic plan should be bigger than company objectives because it spans multiple years.

What’s the difference between a strategic plan vs. a business case?

A business case is a document to help you pitch a significant investment or initiative for your company. When you create a business case, you’re outlining why this investment is a good idea, and how this large-scale project will positively impact the business. 

You might end up building business cases for things on your strategic plan’s roadmap—but your strategic plan should be bigger than that. This tool should encompass multiple years of your roadmap, across your entire company—not just one initiative.

What’s the difference between a strategic plan vs. a project plan?

A strategic plan is a company-wide, multi-year plan of what you want to accomplish in the next three to five years and how you plan to accomplish that. A project plan, on the other hand, outlines how you’re going to accomplish a specific project. This project could be one of many initiatives that contribute to a specific company objective which, in turn, is one of many objectives that contribute to your strategic plan. 

What’s the difference between strategic management vs. strategic planning?

A strategic plan is a tool to define where your organization wants to go and what actions you need to take to achieve those goals. Strategic planning is the process of creating a plan in order to hit your strategic objectives.

Strategic management includes the strategic planning process, but also goes beyond it. In addition to planning how you will achieve your big-picture goals, strategic management also helps you organize your resources and figure out the best action plans for success. 

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Business strategy assignment 1

BTEC Level 5 HND Diploma in Business. Assignment title: business strategy.

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