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Firstly, examine your resources, liabilities, capabilities, strengths, and weaknesses. It's much easier to achieve your objectives when your strategy uses your strengths without exposing your weaknesses. Also, look at your Core Competencies. These highlight your unique strengths, and help you think about how you can set yourself apart from your competitors. Now you need to examine your current operating environment to predict where things are moving. Are there exciting opportunities that you should pursue? What future scenarios are likely in your industry, and how will these impact the work that you do?

They show where you have a strong position within the larger environment, and where you may have issues. As you prepare to create your strategy, make sure that you're working in a way that's aligned with changes in your operating environment, rather than working against them.

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These external factors are often beyond your control, so if you pursue a strategy that requires a change in one of these elements, you may have a long, exhausting, unprofitable battle ahead of you. Your strategy defines how you'll win, and winning is typically framed by how well you satisfy your customers. For-profit companies must keep their customers and shareholders happy. Governments, nonprofits, and project teams all have other stakeholders to satisfy as well. Strategy creation must consider these needs.

Identify your clients and stakeholders.

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What do your clients want? And who are the key stakeholders in your success?

How Do You Write a Business Strategy?

Also, look at your market in detail. Answer key questions such as "How is our market segmented? In a traditional for-profit company, you must understand how your products compare with competitors' products, and what your competitors' competencies are. How easy, or difficult, is it to enter your market?

How to Do Strategic Planning Like a Futurist

What alternatives do customers have? You'll also find many useful tools that can help you understand competitors in our article on Competitive Intelligence. Non-profits, departmental teams and projects have competitors too. Other projects and teams within the department compete for money and other resources. In Stage 1, you developed an understanding of how your organization or team fits within the context of the internal and external environments. Now it's time to think about the different things that you could do to create a clear advantage, and meet your objectives.

Here are some fundamental activities that can help you make this decision. Guide your brainstorming with reference to the organization's mission statement, but, depending on your role in the organization, consider how far you should be constrained by this.


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Using this as a starting point, brainstorm additional ways to maximize your opportunities, minimize your threats, or perhaps even turn your threats into opportunities. A problem-solving approach can also help at this stage.

If your problem is that you're not achieving your goals, ask yourself how you can ensure that you do. If everyone in your industry finds it hard to deal with a particular problem, then you may gain a competitive edge by dealing with it. For example, if you want to increase your customer satisfaction ratings in an industry plagued by poor customer relations, your starting position is "low satisfaction. Stage 3: Evaluating and Selecting Strategic Options.

The final stage is to evaluate strategic options in detail, and select the ones that you want to pursue. You can learn another strategy skills, like this, by joining the Mind Tools Club.


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By this stage, you've probably identified a range of good projects that you could run. You must now evaluate these to choose the best strategic options. Consider every option you've identified, but don't make a final judgment until you've completed your assessment. Start by evaluating each option in the light of the contextual factors you identified in Stage 1. What do these tell you about each option? Make sure that you explore these thoroughly.

Many options will be analyzed on a financial basis. It helps you weight individual decision criteria, and consider subjective features - like team fit and the likelihood of team buy-in - as well as objective, tangible factors like cost and return on investment. With your evaluation complete, you now must choose the best strategic option or strategic options, making sure that you don't choose so many options that you spread your resources too thinly. It's easy to forget about these critical elements during strategic planning, so ensure that what you want to "win" is something that contributes towards the organization's overall purpose.

Check your assumptions using the Ladder of Inference. This helps you confirm the soundness of the reasoning process used to develop your strategy. There's a lot of debate and disagreement about the best way of developing a strategy. Don't be afraid to adapt this approach to your own, specific circumstances! It's no good developing a strategy if you don't implement it successfully, and this is where many people go astray.

But do they work? Well, they need to. Taking the annual appraisal example, much of the criticism around them has been the lack of well thought out feedback, with too many discussions centered around pay rises rather than real learning or actionable next steps. The model here is now shifting to one of continuous feedback, where employees and management alike are being encouraged to raise issues in the moment instead of waiting all year.

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When was the last time they were refreshed? Are they just words on a wall or words on your website? These are easy to say, but hard to achieve — they rely on having a culture that truly accepts criticism, failure and disagreement. Again, the word typically gets widespread support but putting true diversity of thought and background into action is more difficult. Given that values need to reflect the reality of what it feels like to actually work for your company, the real opportunity is to involve all your employees in defining them.

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Assumptions and stereotypes can be a killer in business, and senior management might be afraid of what would come back if they actually asked people what they think. So how can companies shake things up? Critically, they need to encourage people to speak up — and make it safe and convenient for them to do so.