But mapping out your strategy and understanding your market position is vital to its success. Here are 8 strategic planning tools to help you do just that.
Developing a sound strategy is something every organization strives to achieve, with a highly effective strategy helping organizations establish their competitive position, grow market share, and thrive in a ruthless business environment.
However, choosing the right tools to execute that strategy and bring their strategic processes to life is something few are concerned with. The first significant part of the strategic management process or business planning involves analysis and planning. The strategy tools and examples we’ve listed in this section are all about helping you understand where you are today and where you want to be tomorrow.
A SWOT analysis is one of the most commonly used planning tools and is a great place to start when you’re mapping out your business strategy. SWOT stands for strengths, weaknesses, opportunities, and threats. This framework allows you to quickly understand the current state of your business and where there may be opportunities or areas of improvement.
Porter’s Five Forces Model is a tool developed by Michael E. Porter that helps businesses understand the level of competition within an industry and develop strategies accordingly. The model considers five different forces that impact business strategy: supplier power, buyer bargaining power, the threat of new entrants, the threat of substitutes, and rivalry among existing competitors.
GAP analysis is a process of identifying the difference between where you are today and where you want to be in the future. This toolkit provides a framework for understanding your current state, setting goals, and developing a plan to close any gaps.
PEST Analysis is a framework that helps businesses assess the Political, Economic, Social, and Technological factors that may impact their business. This information can then be used to develop strategies that take these external factors into account.
VIRO is an acronym for Values, Interests, Resources, and Opportunities. The VIRO framework helps businesses understand their internal and external environment so they can make better strategic decisions.
The Ansoff Matrix is a tool that helps businesses understand the relationship between their products and markets. It also provides a framework for thinking about growth opportunities. The matrix has four quadrants:
The BCG Growth-Share Matrix is a tool developed by the Boston Consulting Group that helps businesses understand their relative position in the marketplace. The matrix has four quadrants:
The GE Business Screen is a tool developed by General Electric that helps businesses understand their position in the marketplace and make decisions about where to allocate resources. The matrix has nine quadrants:
There are no right or wrong tools for businesses to use, instead the ones that simply suit them best. And those tools might change depending on your business's needs, goals, and the market in which it operates. The important thing is to continually assess your business’s needs and make sure you’re using the right tools to help you reach your goals.
Empiraa is then the strategic execution tool that allows you to drive your team, your business and its growth by providing a framework for setting goals, measuring progress, and holding people accountable.