What Is A Real Marketing Strategy?
Although strategy first became a popular business buzzword during the 1960s, it continues to be the subject of widely differing definitions and interpretations. The following definition, however, captures the essence of the term:
A strategy is a fundamental pattern of present and planned objectives, resource deployments, and interactions of an organization with markets, competitors, and other environmental factors.
Our definition suggests that a strategy should specify (1) what (objectives to be accomplished), (2) where (on which industries and product-markets to focus), and (3) how (which resources and activities to allocate to each product-market to meet environmental opportunities and threats and to gain a competitive advantage).
The Components of Strategy
A well-developed strategy contains five components, or sets of issues:
1. Scope.
The scope of an organization refers to the breadth of its strategic domain the number and types of industries, product lines, and market segments it competes in or plans to enter. Decisions about an organization's strategic scope should reflect management's view of the firm's purpose or mission. This common thread among its various activities and product-markets defines the essential nature of what its business is and what it should be.
2. Goals and objectives. Strategies also should detail desired levels of accomplishment on one or more dimensions of performance-such as volume growth, profit contribution, or return on investment-over specified time periods for each of those businesses and product markets and for the organization as a whole.
3. Resource deployments. Every organization has limited financial and human resources. Formulating a strategy also involves deciding how those resources are to be obtained and allocated, across businesses, product-markets, functional departments, and activities within each business or product-market.
4. Identification of a sustainable competitive advantage.
One important part of any strategy is a specification of how the organization will compete in each business and product-market within its domain. How can it position itself to develop and sustain a differential advantage over current and potential competitors? To answer such questions, managers must examine the market opportunities in each business and product-market and the company's distinctive competencies or strengths relative to its competitors.
5. Synergy.
Synergy exists when the firm's businesses, product-markets, resource deployments, and competencies complement and reinforce one another. Synergy enables the total performance of the related businesses to be greater than it would otherwise be: The whole becomes greater than the sum of its parts.
The Hierarchy of Strategies
Explicitly or implicitly, these five basic dimensions are part of all strategies. However, rather than a single comprehensive strategy most organizations have a hierarchy of interrelated strategies, each formulated at a different level of the firm. The three major levels of strategy in most large, multiproduct organizations are (I) corporate strategy, (2) business level strategy, and (3) functional strategies focused on a particular product-market entry.
Our primary focus is on the development of marketing strategies & programs for individual product market entries, but other functional de departments-such as R&D and production-also have strategies and plans for each of the firm's product-markets. Throughout this book, therefore, we examine the interfunctional implications of product-market strategies, conflicts across functional areas, and the mechanisms that firms use to resolve those conflicts. Strategies at all three levels contain the five components mentioned earlier, but because each strategy serves a different purpose within the organization, each emphasizes a different set of issues.
Meet Amarendra Bhushan, A leading Strategic Human Resource Consultent, MBA from American university of athens, greece, also editing The European journal of NRI finance magazine TRIBUNE). As one of the leading article writer, and corporate hotel professional. Advisor to various organizations and hotels. He is an elected member of south Indian hotel and restaurant federation. Now staying at city of Athens Greece. Amarendra bhushan Dhiraj Athens, Greece PH-0030-6947667507 abdhiraj@mail.gr
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