Business strategy is a tool for managers so that they are able to respond to the competing needs and changes in the market. Business strategies should be effective enough so that they ensure productivity in the company. It is important for all managers to adopt a strategy for their company to allow for benchmarking, outsourcing and business re-engineering.
Adoption of a business strategy enables the company to move with changes taking place in the market like changing technology. Starbucks corporation is a good case of a company that uses global business strategy in the coffee industry. It offers the best services and quality coffee for its customers. It utilizes the use of global strategies in correcting mistakes in the market to make it the best company in the industry.
Business strategy also helps in finding great ideas in emerging markets. Companies can get ideas on various aspects of business on the basis of emerging markets. For instance, a company can come up with ideas from weaknesses of an emerging market. Other businesses see opportunities but they are not able to act on them. It is from such opportunities that an idea is born. A manager generates such ideas by identifying the problem from the emerging markets then finds a solution. The manager then applies the solution to change direction by creating a new idea for the multinational company.
Managers should be aware of the five forces that shape business strategy because they are important when coming up with effective strategies. The essence of a business strategy is for managers to understand competition in the market and learn how to cope with the competition. Threat of new entrants is one of the five forces that guide managers when making strategies.
Wal-mart is an example of a successful company that uses these forces. Business strategy derives its success from analyzing these factors to make strategies on how to handle competition in the market. This makes Wal-mart successful in the US because the use of these factors enables it to make effective strategies, therefore, contributing to its success.
Business strategy is vital especially when analyzing competition in the market. Bargaining power of suppliers is the second force that shapes strategy. The bargaining power of buyers is also an important factor because it guides managers when making a strategy of customers. The other factor is rivalry among existing competitors. This factor enables Wal-mart to study the weaknesses of its rivals and act upon them. Business strategy does so by making sure that such weaknesses are its strong areas when it comes to delivering services. Threat of substitute products and services is the fifth force that shapes strategy because it guides managers on how to deal with competition.
Corporate social responsibility (CSR) is another aspect of business strategy in companies. Nike is an example of a company that has a good corporate social responsibility that makes it special in Indonesia. This company has done a lot to improve the environment and the society in Indonesia. CSR includes the moral obligation of the society and it protects its reputation through this strategy.
Netflix company uses Blue ocean strategy in its operations. This business strategy uses the policy of pulling in new customers to their business rather than stealing clients from other businesses in the market. This is a policy that Netflix uses; hence, making profits that contribute to its success. Such customers were traditional clients, therefore, not current customers of the existing industry.