Dellum, On The Team at GBC, 3 min read
In evaluating how well your company’s present strategy is working, the best way to start is with a clear view of what the strategy entails. The first thing to examine is your company’s competitive approach. What moves has your company made recently to attract customers and improve its market position-for example, did your company cut prices, improved the design of its product, added new features, stepped up advertising, entered a new geographic market or how about-merged with a competitor? Is your company striving for a competitive advantage based on low-costs or better product offering? Is your company concentrating on serving a broad spectrum of customers or a narrow market niche? Your company’s functional strategies in research & development, production, marketing, finance, human resources, information technology, and so on further characterise your company strategy, as do any efforts to establish competitively valuable alliances or partnerships with other companies.
The three best indicators of how well your company’s strategy is working are (1) whether your company is achieving its stated financial and strategic objectives (2) whether your company’s financial performance is above the industry average, and (3) whether it is gaining customers and increasing its market share. Persistent shortfalls in meeting company performance targets and weak marketplace performance relative to rivals are reliable warning signs that your company has a weak strategy or suffers from poor strategy execution or both. Some specific indicators of how well your company’s strategy is working include:
- Whether your company’s sales are growing faster than, slower than, or about the same pace as the market as a whole, thus resulting in a rising, eroding, or stable market share.
- Whether your company is acquiring new customers at an attractive rate as well as retaining existing customers.
- Whether your company’s image and reputation with its customers is growing stronger or weaker.
- Whether your company’s profit margins are increasing or decreasing and how well its margins compare to rival company margins.
- Trends in your company’s net profits and returns on investment relative to those of other company’s in the industry.
The stronger your company’s current overall performance, the more likely it has a well-conceived, well executed strategy. The weaker your company’s financial performance and market standing, the more your company’s current strategy must be questioned and the more likely the need for radical changes.
Hope you enjoyed this short thought-leadership piece. Must love…from GBC.
Try our most innovative strategic planning software to empower your business to grow & unlock its true potential. StratPlan is free to try!
Looking To Start Your Own Consulting Business? Partner With Us and run your own consulting business the way you want to, working the hours you want to!
FREQUENTLY ASKED QUESTIONS
Why do I need to fill out the information requested?
Is this really free?
Absolutely. Just sharing some experience that we hope you’ll find useful. Keep us in mind next time you have strategic planning questions.