Meaning of strategy

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Strategy is the mean or the tool by which objectives are consciously and systematically Greek for leading/guiding/moving.

In its military aspect, the term had to do with stratagems by which a general sought to defeat an enemy, with plans he made for a campaign, and with the way, he moved and disposed his forces in war.

The strategy definition most commonly known today is as the art of analysing, projecting and directing campaigns.

Strategy is not planning. Strategy deals with competitive situation in an uncontrolled environment.

Planning deals with situations in a controlled environment.

Strategy is however an Art, not a Science, it is the Art of the conscious mind in action when facing a challenge.

Strategy is the Art that man invented three thousand years ago, when the "voices of the Gods" stopped guiding him in the decision making process!

It is the greatest "winning tool" that man ever invented!

It enables the practitioners to see clearly the future of any encounter they undertake - Whilst reacting rationally and consciously without the need for intuition or guesswork.

It is the Art of the "Conscious Mind"; the Art of the General in the battlefield; therefore, it is:

Definition 1

Alternative chosen to make happen a desired future, such as achievement of a goal or solution to a problem.

Definition 2

Art and science of planning and marshalling resources for their most efficient and effective use. The term is derived from the Greek word for generalship or leading an army. See also tactics.

Examples of a company stakeholders


Examples of interests

Owners private/shareholders

Profit, Performance, Direction


Taxation, VAT, Legislation, Low unemployment

Senior Management staff

Performance, Targets, Growth

Non-Managerial staff

Rates of pay, Job security

Trade Unions

Working conditions, Minimum wage, Legal requirements


Value, Quality, Customer Care, Ethical products


Credit score, New contracts, Liquidity

Local Communitys

Jobs, Involvement, Environmental issues, Shares

Refere only

ASDA has announced it had delivered its tenth successive quarter of outperforming the market with comp sales (like-for-like), excluding petrol, increasing 6.9% (up from 6% in Q2 and 5% in Q1). Sales growth continued to be driven by a combination of increased customer numbers (in particular AB shoppers) and higher basket spend.

Despite the tough trading environment ASDA grew total sales in the ‘high single digits' excluding petrol for the period up to 30th September. Figures published this week by TNS show ASDA is growing twice as fast as the UK market.

At a time when customers are increasingly price conscious, ASDA continues to drive its low cost agenda enabling it to fund lower prices for customers. As a result it has further strengthened its price advantage over its competitors.

ASDA's profit grew ahead of target with good cost control despite rising energy costs. The delivery of ASDA's sustainability programme has contributed to lowering operating costs as well as reducing its carbon footprint.


ASDA has invested £30m in improving product quality with blind taste tests showing its own label products out-performing comparable products from premium-led retailers. This is one of the initiatives that resulted in strong food sales in the quarter particularly in fresh meat, chilled food and wine, satisfying the demand of higher demographic customers.

General Merchandise

General merchandise has outperformed all major general merchandise retailers over this period, with the strongest growth in Baby, Music, Video and Games. ASDA also had its best ever Halloween performance.

The ASDA Mobile network grew rapidly as the company threw down the gauntlet with the launch of the UK's lowest pay-as-you-go mobile tariff.


Sales of George outperformed a difficult market, with ASDA gaining share from its high street rivals (TNS World panel - 24 weeks to 14th September). This year George has simplified its ranges, significantly improved product quality and bought higher volumes of iconic products like the stunning £15 winter coat, £35 tuxedo and £12 little black party dress. George also launched its new marketing campaign this quarter focusing on using real people not highly paid celebrities.


ASDA continues the rollout of its home shopping service, which now covers more than 90% of the UK population and is the UK's second biggest food home shopping business. ASDA's home shopping service is increasingly being chosen by more customers who are looking for great quality and outstanding value, but who may not have an ASDA on their doorstep. To meet demand this Christmas ASDA has increased the number of delivery slots by 40 per cent compared to 2007.

The supermarket also recently launched ASDA Direct, offering non food products to on-line shoppers across the UK.

Store openings

ASDA has opened fifteen new stores so far this year, including four new ASDA Living stores, with a further six stores due to open in 2008.

ASDA CFO, Judith McKenna commented: "This is another strong set of numbers. We have continued to grow volume and gain market share each quarter this year by focusing on giving our customers great quality and outstanding value at a time when they need them most. Our strategy of being the lowest cost to operate supermarket is the right one, and is helping us drive down prices.

"We are absolutely committed to making life easier for hard-pressed shoppers. We will continue to offer outstanding value for money across our entire range of food, general merchandise and clothing. As a result I am confident our stores are well set up to enable customers to have the best possible Christmas."

ASDA strategy

Dell unveiled the Android-based Mini 3 smartphone today and announced that it will be available soon in China and Brazil. Venturing away from the familiar server and desktop foundation that Dell is built on may seem risky, but there is a method to Dell's madness that may just pay off.

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Ever since rumors began to circulate earlier this year that Dell was planning a move into smartphones there have been naysayers. The market is crowded. Competition is rough. Dell is already losing ground in its core business. If your device isn't from Apple and doesn't say 'iPhone' it can't succeed in the smartphone market.

Dell has tried to expand its portfolio of hardware over the years, distributing printers, cameras, PDA's, televisions, and other Dell-branded peripherals. Those efforts have been met with mixed success, and even the best of them has been received moderately at best. The message to Dell for the most part has been 'don't quit your day job.'

The move by Dell into smartphones is not a desperate hail-mary, though, but a calculated strategy. A mobile phone is no longer just a mobile phone, it is a mobile computing device. The Mini 3 is not so much a branch into a new direction as it is a natural evolution of Dell's core market.

The flip side this evolution is Nokia. Nokia has built its reputation as a provider of mobile devices. However, it too sees the writing on the wall in terms of the future of mobile computing which is why it has developed the Booklet 3G netbook. Dell and Nokia are coming at the problem from two different sides and meeting somewhere in the middle.

Why China then? If Dell wants to get into the smartphone market, why not launch the Mini 3 in the United States? With devices like the Motorola Droid, HTC Droid Eris, and Samsung Behold II the Android platform is taking the industry by storm and Dell could ride that wave of Android popularity.

Perhaps the better question to ask though is "why not China?" In the United States the total mobile phone market is around 270 million and Dell would have to engage in an exclusive distribution arrangement that would limit the market to less than 90 million.

Verizon and AT&T may dominate the mobile provider market in the United States, but from a global perspective they are the big fish in a small pond. China Mobile alone has a subscriber base nearly double the entire United States market. América Móvil, the parent of the provider Dell will be distributed through in Brazil, has more subscribers than Verizon and AT&T combined.

Some, like my PC World peer Jared Newman, have suggested that perhaps Dell is avoiding the United States market because the Mini 3 is underwhelming and Dell knows it would flop. The Mini 3 may not compare well on paper with other whiz bang smartphones in the United States, like the iPhone or the Droid, but Asia uses its mobile devices differently. I don't know if you've noticed, but the iPhone hasn't exactly been flying off the shelves since it launched in China.

As much as we like our gadgets, users in Europe and Asia are actually more demanding when it comes to mobile devices. Users in China expect to be able to order food from vending machines and pay for parking from their mobile phones.

It does seem risky for Dell, a brand established on servers and desktops, to dive into a highly competitive market like smartphones. At face value it may seem questionable to avoid launching in the United States. But, if Dell can carve a niche for the Mini 3 in a market like China it doesn't need to try to be the next iPhone killer in the United States.

Dell's Mini 3 strategy seems a little crazy. But, if it works Dell will be crazy like a fox and laughing all the way to the bank.

Strategy - What is strategy?

Overall Definition:

Johnson and Scholes (Exploring Corporate Strategy)define strategy as follows:

"Strategy is thedirectionandscopeof an organisation over thelong-term:which achievesadvantagefor the organisation through its configuration ofresourceswithin a challengingenvironment, to meet the needs ofmarketsand to fulfilstakeholderexpectations".

In other words, strategy is about:

Where is the business trying to get to in the long-term (direction)

Which markets should a business compete in and what kind of activities are involved in such markets? (markets;scope)

How can the business perform better than the competition in those markets? (advantage)?

What resources (skills, assets, finance, relationships, technical competence, facilities) are required in order to be able to compete? (resources)?

What external, environmental factors affect the businesses' ability to compete? (environment)?

What are the values and expectations of those who have power in and around the business? (stakeholders)

Strategy at Different Levels of a Business

Strategies exist at several levels in any organisation - ranging from the overall business (or group of businesses) through to individuals working in it.

Corporate Strategy- is concerned with the overall purpose and scope of the business to meet stakeholder expectations. This is a crucial level since it is heavily influenced by investors in the business and acts to guide strategic decision-making throughout the business. Corporate strategy is often stated explicitly in a "mission statement".

Business Unit Strategy- is concerned more with how a business competes successfully in a particular market. It concerns strategic decisions about choice of products, meeting needs of customers, gaining advantage over competitors, exploiting or creating new opportunities etc.

Operational Strategy- is concerned with how each part of the business is organised to deliver the corporate and business-unit level strategic direction. Operational strategy therefore focuses on issues of resources, processes, people etc.

How Strategy is Managed - Strategic Management

In its broadest sense, strategic management is about taking "strategic decisions" - decisions that answer the questions above.

In practice, a thorough strategic management process has three main components, shown in the figure below:

Strategic Analysis

This is all about the analysing the strength of businesses' position and understanding the important external factors that may influence that position. The process of Strategic Analysis can be assisted by a number of tools, including:

PEST Analysis- a technique for understanding the "environment" in which a business operates

Scenario Planning- a technique that builds various plausible views of possible futures for a business

Five Forces Analysis- a technique for identifying the forces which affect the level of competition in an industry

Market Segmentation- a technique which seeks to identify similarities and differences between groups of customers or users

Directional Policy Matrix- a technique which summarises the competitive strength of a businesses operations in specific markets

Competitor Analysis- a wide range of techniques and analysis that seeks to summarise a businesses' overall competitive position

Critical Success Factor Analysis- a technique to identify those areas in which a business must outperform the competition in order to succeed

SWOT Analysis- a useful summary technique for summarising the key issues arising from an assessment of a businesses "internal" position and "external" environmental influences.

Strategic Choice

This process involves understanding the nature of stakeholder expectations (the "ground rules"), identifying strategic options, and then evaluating and selecting strategic options.

Strategy Implementation

Often the hardest part. When a strategy has been analysed and selected, the task is then to translate it into organisational action.

Competative advantages

1. Superiority gained by afirmwhen it canprovidethe samevalueas itscompetitorsbut at a lower price, or canchargehigherpricesby providing greater value throughdifferentiation. Competitive advantageresultsfrom matchingcore competenciesto theopportunities.

2. Conditionwhich enables acompanyto operate in a more efficient or otherwise higher-quality manner than the companies it competes with, and whichresultsinbenefitsaccruing to that company.

3. Competitive Advantage - Definition

A competitive advantage is an advantage over competitors gained by offering consumers greater value, either by means of lower prices or by providing greater benefits and service that justifies higher prices.

Competitive Strategies

Following on from his work analysing thecompetitive forces in an industry, Michael Porter suggested four "generic" business strategies that could be adopted in order to gain competitive advantage. The four strategies relate to the extent to which the scope of a businesses' activities are narrow versus broad and the extent to which a business seeks to differentiate its products.

The four strategies are summarised in the figure below:

Thedifferentiationandcost leadershipstrategies seek competitive advantage in a broad range of market or industry segments. By contrast, thedifferentiation focusandcost focusstrategies are adopted in a narrow market or industry.

Strategy - Differentiation

This strategy involves selecting one or more criteria used by buyers in a market - and then positioning the business uniquely to meet those criteria. This strategy is usually associated with charging apremium pricefor the product - often to reflect the higher production costs and extra value-added features provided for the consumer. Differentiation is about charging a premium price that more than covers the additional production costs, and about giving customers clear reasons to prefer the product over other, less differentiated products.

Examples of Differentiation Strategy:Mercedes cars;Bang & Olufsen

Strategy - Cost Leadership

With this strategy, the objective is to become the lowest-cost producer in the industry. Many (perhaps all) market segments in the industry are supplied with the emphasis placed minimising costs. If the achieved selling price can at least equal (or near)the average for the market, then the lowest-cost producer will (in theory) enjoy the best profits. This strategy is usually associated with large-scale businesses offering "standard" products with relatively little differentiation that are perfectly acceptable to the majority of customers. Occasionally, a low-cost leader will also discount its product to maximise sales, particularly if it has a significant cost advantage over the competition and, in doing so, it can further increase its market share.

Examples of Cost Leadership:Nissan;Tesco;Dell Computers

Strategy - Differentiation Focus

In the differentiation focus strategy, a business aims to differentiate within just one or a small number of target market segments. The special customer needs of the segment mean that there are opportunities to provide products that are clearly different from competitors who may be targeting a broader group of customers. The important issue for any business adopting this strategy is to ensure that customers really do have different needs and wants - in other words that there is avalid basis for differentiation- and that existing competitor products are not meeting those needs and wants.

Examples of Differentiation Focus: any successful niche retailers; (e.g.The Perfume Shop); or specialist holiday operator (e.g. Carrier)

Strategy - Cost Focus

Here a business seeks a lower-cost advantage in just on or a small number of market segments. The product will be basic - perhaps a similar product to the higher-priced and featured market leader, but acceptable to sufficient consumers. Such products are often called "me-too's".

Examples of Cost Focus: Many smaller retailers featuring own-label or discounted label products.