What is a strategic input?
Strategic inputs are data that you have gathered from research, feedback, your customers, the market, etc that you believe are critical to your business forming and implementing strategy. We aren't talking about ‘business as usual’ inputs here - they are covered by the operational side of your business.
Why gather strategic inputs?
Gathering inputs helps us gain insight into what is important for building our strategy.
Our vision gives us a picture of where we want to take the business, now we need to build our strategy to get there. The first logical step is to understand and assess where we are now – what is our current state? It’s important to make this assessment with both an internal gaze and an external perspective.
To do this, we are going to use two tools:
- Strengths, weaknesses & trends (SWT)
- Competitor analysis
Strengths, weaknesses, and trends (SWT)
This will help get you clarity on the current state of the business.
Strengths
Strengths are internal factors that your business has that give you an advantage over others.
Examples may include.
- Strong brand recognition
- Proprietary technology
- Robust financial resources
- Highly skilled workforce
- High level of repeat business
- Efficient, well-documented processes and systems
- Flexibility or scalability of operations
- Extensive distribution network
- Effective strategic partners
- Unique product offering
Weaknesses
Weaknesses are internal factors that may limit or impact your business’s ability to achieve its goals and reach your vision.
Weaknesses are factors that may put your business at a disadvantage to others - and are things your business doesn’t do well or needs to improve.
Examples may include:
- Lack of brand recognition
- Outdated technology
- Ineffective marketing or business development processes
- Limited financial resources
- Poor customer retention
- High staff turnover or organisational cultural issues
- Limited innovation ability
- Ineffective leadership
- Inferior product or service quality
Trends
Trends are external factors that need to be considered when you are doing your strategic planning. These are factors that you will not be able to directly control but will need to consider their potential impact. Consider both present and anticipated conditions.
Examples could be
- Changes in consumer preferences or attitudes
- Technology advances
- Legislative changes
- Economic downturn
- New markets opening up or closing in your industry.
- A new competitor entering the market or a competitor exiting.
- Mergers or acquisitions
- Supply chain changes or potential disruptions.
When looking at trends it can be useful to consider scale as a way of filtering what can be an enormous amount of information.
- Megatrends – A megatrend is a long-term shift in behaviour or attitude with global impact across multiple industries. Is there anything happening that could impact your business? Something like changes in work practices such as working from home and flexible work arrangements or consumers becoming more concerned about environmental impact could be examples of a megatrend.
- Industry – Is there something happening in your industry that needs to be considered? Could be new technologies or environmental issues. Such trends can provide opportunities or potential threats.
- Market – What about in your specific market, this could be customer or geographic, is anything happening in consumer preferences or technologies? Are there new markets opening up or perhaps some closing down?
- Competition – What is happening in the competitive landscape of your specific market? Maybe a new competitor has entered the market or some existing competitors are behaving differently.
Tips
Like all data you gather, we encourage you to discuss, debate and agree before you record them. Strategic planning is a messy process - try and focus on the data that matters. People will probably bring up strengths and weaknesses that while interesting, don’t really have much consequence in the strategic conversation of how you are going to succeed. Be prepared to invest the time to debate and discuss so the inputs are the ones that matter the most.
For example, a strength worth recording might be “Our multi-disciplinary product team enables us to develop a solution that appeals to a wide customer base”. A strength like “We have a great office” is just business-as-usual and probably not of much interest. A weakness worth recording might be “We accept business in too many disciplines, so we are spread too thin and our customers have a bad experience”.
Competitors analysis
Consider your key competitors. Focus on the customers whom you would want to serve. (If the competitor is serving customers in a market or with a solution that doesn’t fit in your bullseye it is probably not relevant data).
Why do they win?
- What strengths or advantages do they deploy when they attract and keep customers in your market?
- What are they offering that is of value to customers?
Why do they lose?
- Can you identify any weaknesses or reasons they might not be winning customers, or not able to maintain customers?
Where and how do they compete with us?
- What products and services do they offer that your business offers?
- How are they competing?
- Is it price, experience, quality, or service?
- Why do we need to consider doing a competitor analysis?
Final thoughts
We appreciate that with some of this work, you are posing a hypothesis, you don’t necessarily have all the facts. However, by doing the research and creating the space to discuss your competitors as a team you will gain valuable insights that will help you develop a strategy for success.