In the dynamic landscape of business, the path to success is marked by strategic decision-making that can drive growth and sustainability. It's a journey that begins with understanding your unique strengths and competitive advantages and then extends to defining where to focus your efforts and how to emerge victorious in your chosen domains. This blog post delves into three crucial aspects that underpin strategic growth: Where to Play (WTP), How to Win (HTW), and the critical art of making clear WTP/HTW choices.
1. Where to Play (WTP): Setting the Stage for Success
The journey to strategic growth commences with a clear understanding of your target audience and what constitutes success for your business. "What is winning?" is the pivotal question that guides this phase. It directs you to identify your most valuable customers and the specific business measures that will generate sustainable value for both you and them. This value exchange forms the bedrock of strategic decision-making.
Next comes the critical step of determining "where to play." Just as a chess player selects a specific square to move their piece, businesses must meticulously choose their playing field. Small businesses often enjoy an advantage in this arena, possessing an intimate knowledge of their customers and forging strong relationships that can yield competitive edges. Identifying your best primary customer and exploring avenues of growth, such as entering new customer segments or adapting to changing industries, can be transformative.
2. How to Win (HTW): Crafting a Winning Strategy
Once you've charted your playing field, the focus shifts to "how to win." Your strategy should reflect a keen understanding of user needs, competitive landscapes, and your own capabilities. This phase encompasses a deep dive into multiple dimensions:
- Geography: Where will you compete? Which regions or countries align with your strengths and customer base?
- Product Type: What products or services will you offer? How will they meet unfulfilled consumer needs?
- Consumer Segment: Who are your target consumers? What niches or price tiers will you serve?
- Distribution Channel: How will you reach your customers? Online platforms, social media, or traditional channels?
- Production Stage: Where will you engage along the value chain? Upstream with suppliers or downstream closer to customers?
But crafting a winning strategy requires more than just answers to these questions. It involves staying ahead of dangerous temptations, like attempting to serve all segments simultaneously or making acquisition-driven leaps into attractive markets. Instead, focus on discipline, avoiding resignation, and embracing change.
3. Making Clear WTP/HTW Choices: The Essence of Strategy
Ultimately, strategy is a culmination of choices. It's about selecting the right fields to play on and outlining the strategies to win in those fields. Where to play and how to win are inseparable components of this equation. Once your vision and objectives are clear, making choices becomes the beacon guiding your actions.
The intersection of Where to Play and How to Win, succinctly termed as WTP/HTW choices, underscores the essence of strategy creation. These choices involve picking the markets, customers, products, and distribution channels that harmonize with your strengths and cater to real consumer needs. It's about aligning your goals with your actions and optimizing your resources for optimal growth.
In a rapidly evolving business landscape, the power of strategic choices cannot be underestimated. By defining your WTP/HTW choices, you establish the framework for growth and resilience. Small businesses might have limitations in terms of scale, but the principle remains the same: focus is key. Don't attempt to be everything to everyone; instead, choose your battles wisely and execute with excellence.
In conclusion, the journey towards strategic growth involves a multi-faceted approach. Starting from understanding the value you offer to customers and extending to meticulously selecting where to play and how to win, each step contributes to a comprehensive strategy. The ability to make clear WTP/HTW choices sets the tone for your business's success. In a landscape where change is constant, these choices act as the North Star, guiding your business towards sustainable growth and prosperity.
Credit: this article is based on ideas developed by A.g. Lafley and Roger L. Martin in their book "Playing to Win: How strategy really works".