Andrea Belk Olson A simple way to understand strategy
Strategy is a hard concept to digest, especially for stayed institutions that have seen past success but have reached a growth plateau. New competitors are coming in, the organization has started to move slower, and sales are anything but impressive. They’re surviving, but not flourishing. Often, the first step is to refresh the “organizational strategy”. This comes in the form of a series of meetings, where high-level, lofty aspirations are put to paper, and then delivered to the rest of the organization. Then – well, not much other than a series of new initiatives, which barely move the needle. The problem is, we misunderstand what strategy is. Today, we’re going to give you an easy example to use.
You own a bar and grill. You have patronage, but want to grow. You want more customers coming through the door. So you might start with marketing – hiring an ad agency or a freelancer to come up with a promotional campaign. For the short term, it brings in a few folks, but nothing revolutionary. So you change it up – you turn to your existing customers, asking them what they need and what they’d like to see. Their input provides a few new food item ideas, which you add to the menu. You sell a few, but it isn’t a big draw.
They suggest adding a variety of features, such as pool tables, a dance floor, karaoke, and bands on weekends. You can’t afford all those things, so you just pick the ones which are within your budget. Again, nothing really changes. Now you have a hodgepodge of things in a business that’s everything and nothing at the same time.
Here’s the issue: There’s no strategy. Strategy is defining (in this scenario) whom you want to cater to, and how you’ll stand out from the other bar and grills in the area. So where do you begin? First, define whom you want to cater to. The high-end, elite crowd? The business customer? Blue-collar folks? What audience you pick depends on a few things – where you’re located (surrounding population/business opportunity), and what you’re good at (if you have a full, experienced kitchen or just a small prep area), for example.
Now, how are you going to compete and stand out in a way that distinct and unique? This is the second half of strategy – defining who you are. Whom you cater to and “who you are” need to align. It’s obvious that folks coming off a second-shift assembly line won’t care about canapes.
But here’s the key – you have to not just define who you are, but determine how you’ll stand out in a way that resonates with your target audience. What makes you different from the other 12 competitors in a 2-mile radius? How will you position the business that makes it distinct? (This doesn’t mean the basics, like having TVs in a Sports Bar. That’s the requirement to be a Sports Bar.) It means doing something unique – something that stands out and is memorable, relevant, and congruent. In this scenario, it might be a catchy theme or vibe you create that makes you different. Or it could be having the most diverse beer selection in town. What matters is that it stands out in a way that connects with your target audience.
With these two initial elements, the rest will begin to fall into place – the food menu, the drink menu, the atmosphere, prices, and entertainment – all should follow your audience and differentiation focus. After that, you can continue to refine all the things you offer as you get customer feedback.
And that’s the difference – established companies want to first focus on new products and/or services to change their growth trajectory. Yet, they often don’t really know whom they’re targeting (instead, pursuing anyone and everyone) and they don’t really know how to stand out and differentiate (instead, doing the same things their competitors are doing). So before diving into what new things to add, begin with defining your target audience and your unique approach to differentiation. That framework will help determine what you actually need, and more importantly, what you don’t.
About the Author
Andrea Belk Olson is a keynote speaker, author, differentiation strategist, behavioral scientist, and customer-centricity expert. As the CEO of Pragmadik, she helps organizations of all sizes, from small businesses to Fortune 500, and has served as an outside consultant for EY and McKinsey. Andrea is the author of three books, including her most recent, What To Ask: How To Learn What Customers Need but Don’t Tell You, released in June 2022.
She is a 4-time ADDY® award winner and host of the popular Customer Mission podcast. Her thoughts have been continually featured in news sources such as Chief Executive Magazine, Entrepreneur Magazine, Harvard Business Review, Rotman Magazine, World Economic Forum, and more. Andrea is a sought-after speaker at conferences and corporate events throughout the world. She is a visiting lecturer and startup coach at the University of Iowa, a TEDx presenter, and TEDx speaker coach. She is also an instructor at the University of Iowa Venture School.
More information is also available on www.pragmadik.com and www.andreabelkolson.com.
