How Do You Identify A Business Level Strategy?

Identifying a business-level strategy involves analyzing how a company positions itself within its industry or market segment to gain a competitive advantage and achieve its objectives.

Here are some key steps to help identify a business-level strategy…

1. Analyze Target Market and Customers

   
   

   • Determine the target market(s) that the company serves and understand the needs, preferences, and behaviors of its customers. Identify the segments of the market that the company targets and assess how it positions its products or services to meet the specific needs of those segments.

     
     

2. Evaluate Competitive Advantage

   
   

   • Assess the company’s competitive advantage relative to its competitors. Identify the sources of competitive advantage, such as product differentiation, cost leadership, focus/niche strategy, or innovation. Analyze how the company’s strengths and capabilities contribute to its ability to outperform competitors in the market.

     
     

3. Assess Value Proposition

   
   

   • Understand the value proposition that the company offers to its customers. Evaluate how the company differentiates itself from competitors and creates value for customers through its products, services, features, quality, pricing, customer service, brand reputation, or other factors.

     
     

4. Examine Pricing and Positioning

   
   

   • Analyze the company’s pricing strategy and positioning within the market. Determine whether the company competes on price, quality, convenience, or other factors. Assess how the company’s pricing and positioning align with its target market and competitive landscape.

     
     

5. Identify Strategic Focus

   
   

   • Determine the strategic focus of the company’s business-level strategy. This may involve focusing on a broad market (broad differentiation or cost leadership), targeting a specific market segment (focused differentiation or cost focus), or pursuing a hybrid strategy that combines elements of differentiation and cost leadership.

     
     

6. Evaluate Operational Choices

   
   

   • Evaluate the operational choices and trade-offs that the company makes to execute its business-level strategy effectively. This may include decisions related to product design, production processes, supply chain management, distribution channels, marketing and sales tactics, customer service, and resource allocation.

     
     

7. Consider Industry Dynamics

   
   

   • Consider the industry dynamics, competitive forces, and market trends that shape the company’s strategic choices and performance. Assess how changes in the industry environment, technological advancements, regulatory factors, or competitive actions impact the company’s business-level strategy over time.

     
     

By conducting a thorough analysis of these factors, you can gain insights into the company’s business-level strategy and understand how it positions itself to compete in the market and achieve its goals. Also, observing the company’s actions, behaviors, and performance over time can provide further clues about its strategic direction and effectiveness in executing its strategy.