Abstract
A key challenge faced by many strategy development and review initiatives, whether conducted internally or supported by external consultants or experts, is where to start. Traditional strategy research suggests starting by formulating a vision and a mission, describing the core ideology and envisioned future. Others recommend taking a resource-based approach, focusing on capabilities as the foundation for competitive advantage. More recently, authors such as Christensen, argue that the design of any strategy should start with questions related to customer needs or jobs-to-be-done. The novel concept of strategic focus as the primary dimension along which to compete and differentiate is introduced. Any strategy development should start by identifying the firm’s strategic focus, that is, whether the firm wants to compete and excel by being customer centric, by focusing on product and service innovation, by leveraging core capabilities, or by differentiating around financials. Successful firms primarily compete by being different or superior along exactly one of those dimensions and industry average along the three other ones. The target strategic focus is determined based on the chosen target industry, the environment analysis outcome, and the expected desirability and uniqueness.
The essence of strategy is choosing what not to do—Michael Porter
A preliminary version of parts of this chapter has been presented at the 36th Strategic Management Society Annual International Conference, Berlin, Germany, 2016 and has been published as Diderich (2017).
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Notes
- 1.
The term strategy as such applies to a single firm, a business unit, or a brand within a business unit.
- 2.
A firm is said to be “stuck in the middle” if it does not offer a distinct value proposition that attracts customers. Stuck in the middle firms usually offer multiple mediocre value propositions that customers are unable to identify with or distinguish between and as such are not attracted by them.
- 3.
A buyer driven industry is an industry in which the buyer, rather than the firm, dictates the strategic focus the firm must follow.
- 4.
The “five whys” method is an iterative technique used to explore the cause-and-effect relationships underlying a particular statement. The “why” question is repeated five times. Each answer forms the basis of the next why question.
- 5.
The KID is a standardized Key Information Document required by the MiFID (Markets in Financial Instruments Directive) directive of the European Union to be provided to any investor ahead of their investment decision.
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Diderich, C. (2020). Choosing a Tangible Strategic Focus Rather Than Building Upon an Abstract Vision. In: Design Thinking for Strategy. Management for Professionals. Springer, Cham. https://doi.org/10.1007/978-3-030-25875-7_7
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DOI: https://doi.org/10.1007/978-3-030-25875-7_7
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