JONATHAN DONADO

Linkedin.com/in/jonathandonado

What is

Business Strategy ?

Let’s begin … by asking ourselves

… an Art

It easier to start by defining what it isn’t a Strategy

SOME COMMON MISTAKES:

Be #1 in our market ….Pursue a global expansion….Have unmatched customer

service….etc

STRATEGY is NOT:

a TACTIC an OBJECTIVE or a GOAL a DESCRIPTION

But, today Strategy is a common buzzword:

Where does the word strategy come from?

From the Greek word “Strategos” = The art of the

general

Strategy can be found in the book “The ART of WAR”

by Sun Tzu (from 500 BC)

Today, Business is seen

as a modern

day war….

…challenges of a CEO are similar to an ancient General

…a CEO needs to define a set of tactics to lead to

business “victory”

How do we know what it is our strategy? How do we make one?

A Google Search

provides the following

formal results

?

So … is it a surprise we have misunderstandings about

business strategies?

Or …. why do great strategies have no impact on the

organization?

?

To blame: 1. A strategy that isn’t well defined?

… or 2. A lazy execution?

?

A large proportion of failure is due to Strategy

definition and not in

the execution

Strategy needs to influence Action…. So, in order to influence

Action, it needs to be Remembered….

In order for a strategy to be Remembered…. It needs to be

Understood…

In order to be Understood… a strategy needs to be SIMPLE

(if not it is a just a report)

So, a Strategy needs to be: 1. Remembered 2. Understood

3. Simple

Business Components

Components Overview :

Where are we going? The future. The dreams.

Who are we as a company? What we do. Why we exist. Our purpose. Values.

What are going to do to achieve our objectives? How are we going to get there?

Vision

Mission

Strategy

Example: Business

Components

Canadian

Intellectual Property

Office

https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr03475.html

Example: Mission

Vs Vision

From a philosopher

Example: Strategy

vs Tactics

• Planning • Large Scale • Why • Difficult to Copy • Long Term

Frame

• Doing • Small Scale • How • Easy to Copy • Short Term

Frame

Example: Strategy

vs Tactics

So… Business

Strategy in simple terms

A BUSINESS STRATEGY answers 2 questions:

1. How firms create value 2. How firms sustain value

What is Value ?

What Customers are willing to pay What It cost the Company to produce it VALUE

A Survey Says…

70% of employees don’t understand their company strategy

Forbes “When CEOs Talk Strategy, 70% Of The Company Doesn't Get It”, 2013

To make sure all employees understand the Business Strategy,

we need to make sure that it clarifies the following:

1. Why Customers buy our products?

Need to Clarify Key Drivers

Drivers to increase

revenues or lower cost are defined by Strategy

1. Key Drivers

1. Key Drivers

Who are the people that make out target market ?

1. Key Drivers

Value proposition

to differentiate our products:

1. Product Differentiation 2. Cost Reduction

2. Identify Critical Challenges

2. Challenges

Internal or External. Need to define top 3 to 4

obstacles to focus attention

2. Challenges: Internal

What capabilities do we need to be the best in the market at delivering our value proposition ?

2. Challenges: External

- What is the competition doing? - How is the market evolving? - Etc

2. Key Drivers

Strategy Formulation

2. Key Drivers

Strategy Formulation

2. Key Drivers

Strategy Formulation

Porter 5 Forces

3. Determine Must-Win Battles

3. Must-Win Battles

Define battles that a company needs to win in the next 2 to 3 years to

overcome obstacles to value creation

Why do

companies with good strategies

fail ?

Let’s take the DOW JONES. It started in 1896. The companies were:

Not too many

known names

DOW JONES 1976. The companies were:

Some names

unknown

DOW JONES 2016. The latest group as of March 21 2016

Only GE remains since 1st

Index

The “Strategy Trap” for successful companies:

Exploitation Get cash for growth

Exploration Find new wining products business models

FAILURE ? Companies

need to balance current

strategies with the

discovery of new ones

FAILURE because

overtime as Companies

focus more on

Exploitation

The Strategy Trap for successful companies:

1 / 3 firms become trapped in just a 5 year period

Exploitation

Exploration

FAILURE overtime.

Companies focus

more on exploitation

7 / 10 firms can’t escape the trap

Exploitation

Exploration

FAILURE overtime.

Companies focus

more on exploitation

Business Strategy:

Takeaways:

Business Strategy

Takeaways

1. a Strategy defines how the company creates and sustains value

Business Strategy

Takeaways

2. a Strategy has to be remembered, understood and be simple

Business Strategy

Takeaways

3. a Strategy fails because companies focus on mainly in Exploiting instead or Exploring

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Testimonials

“Jonathan is a very experienced and highly skilled

executive… a great knowledge about both strategic and

managerial issues, with an international approach. He is

highly recommend as a leader, capable to motivate and

improve performance of his teams, and as a business

developer. And definitively, he is a person you can trust.“ Francisco Martinez

CEO

“Jonathan is a very results-oriented persons, a natural leader

and someone that makes his team really perform

efficiently.”

Eduard Fernandez Executive Director

Source: Linkedin.com/in/jonathandonado

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Contact Info

Linkedin.com/in/jonathandonado

Thank You

Jonathan.L.Donado@gmail.com

www.branded.me/jonathandonado

twitter.com/donadosays