It’s a word that gets thrown around a lot. You think about your go-to-market strategy, your customer-acquisition strategy, your customer-retention strategy. You think about your growth strategy, your marketing strategy, maybe even your brand strategy. Of course, there’s your content strategy, your communications strategy, your PR strategy, and your pricing strategy. And don’t forget your meta-strategy, which is the strategy for your strategies.
But what does strategy actually mean?
Business strategist Tim Williams says that strategy isn’t about making plans, it’s about making choices. At Thrive, we agree—and we often tell our clients that if the strategy isn’t right then the tactics don’t matter.
What we mean is that, sure, you can design and update and rebuild and plan, but if the strategy isn’t right, if you haven’t made the right choices—or worse, if your strategy hasn’t been considered at all—then the outcome you’re left with is either a successful one that’s attributable to luck, or an unsuccessful one resulting from a lack of strategy.
There’s no one right, all-encompassing way to define strategy, but consultant and writer Jeroen Kraaijenbrink proposes one I find particularly useful. “Stripped down to its very essence,” he says, “strategy is an organization’s unique way of sustainable value creation.”
While his phrasing is clunky, his emphasis isn’t—it’s on value creation, which is right where it should be, because value creation is the reason every business exists. It’s value that customers are buying, and it’s not hyperbole to say that every single business strategy should be in service of that value.
Large companies understand this. Construction and mining equipment manufacturer, Caterpillar, Inc., which had gross revenues in 2022 of nearly $60 billion, publicly declares that their “enterprise strategy for profitable growth means investing in areas with the most potential to create value.”
Applying Kraaijenbrink’s definition to the types of strategies I listed above, we would then say that marketing strategy is creating value through marketing, and customer-acquisition strategy is creating value through customer acquisition, and brand strategy is creating value through brand. By centering value, we repeatedly put first the customers to whom we provide our goods and services.
To bring this into focus, Harvard Business School Online Business Insights writer Kate Gibson describes how Best Buy, the multinational electronics retailer, shifted its business strategy and fueled growth, which focused on value, even in the face of strong headwinds.
In 2012, Best Buy faced fierce market competition with online platforms like Amazon and big-box stores like Walmart and Home Depot. As a result, the company lost over a billion dollars in revenue in a single quarter.
Rather than closing stores or developing new products, Best Buy’s leadership decided to leverage an existing asset not being utilized to its full potential: its storefronts. Best Buy started using its stores as “mini warehouses,” providing faster shipping times, easier customer pick-up, and improved product availability.
Best Buy implemented a carefully planned strategy, meaning they made carefully planned choices, to deliberately and creatively create new value for their customers, employees, and shareholders. The result wasn’t luck and it certainly wasn’t happenstance.
It was strategy.
The reality of every business is that before you can engage in meaningful work that will make a meaningful difference to both your organization and to your customers’ organizations, you have to consider your strategy. You have to understand exactly what value you’re looking to create for your customers, and why, and you need to make choices to ensure it happens.
There’s simply far too much at stake not to.