Why you NEED a strategy for your small business

Summary

This video emphasizes the crucial need for small businesses to have a well-defined strategy from the start, regardless of size. The speaker challenges the common misconception that strategy is only for large corporations and explains that it’s about making informed choices to navigate obstacles toward long-term success. By breaking down what strategy truly means and differentiating it from goals, the speaker highlights the importance of focusing on customer needs, being unique, and making decisive 'yes' and 'no' choices for sustainable business growth.

Takeaways

• 🚨 Businesses without a strategy are bound to fail, regardless of their size.
• 🤔 Strategy is not just for large corporations; even small businesses need one from the start.
• 🚫 Strategy is not the same as setting goals; it’s about making deliberate choices to navigate toward long-term objectives.
• 🚦 A strategy helps identify the right path and avoid wrong turns, just like a GPS helps navigate to a destination.
• 🔍 The first step in creating a strategy is diagnosing the core challenges in your business, both internal and external.
• 💡 The second step is developing an approach or game plan to overcome these diagnosed challenges.
• 🛑 Saying 'no' is just as important as saying 'yes.' It's crucial to have a list of things you won’t do in order to stay focused.
• 🎯 Strategy involves aligning your choices with your customer’s needs and your business goals, which may vary depending on scale or growth ambition.
• 📊 Goals come into play after your strategy is defined, as they are specific actions and metrics to guide your journey.
• ⏳ Successful businesses are patient and consistent in their strategic choices, avoiding impulsive decisions that lack long-term focus.

Q & A

Why is having a strategy essential for any business, regardless of its size?

A strategy is essential for any business, even the smallest, because it provides direction and helps navigate obstacles toward long-term success. Without a strategy, businesses are more likely to fail, as they lack a structured approach to decision-making and growth.

How does the speaker differentiate between goals and strategy?

The speaker clarifies that goals are specific outcomes a business wants to achieve, such as revenue targets or market growth. Strategy, on the other hand, is a set of choices and approaches that guide how the business will navigate challenges to reach its long-term vision.

What does the speaker suggest is the first step in building a business strategy?

The first step in building a strategy is diagnosing the challenges. This involves identifying both internal and external obstacles that prevent the business from reaching its destination, similar to how a doctor diagnoses a patient's problem.

Why does the speaker emphasize saying 'no' as an important part of strategy?

Saying 'no' is crucial because it helps businesses avoid distractions and focus on actions that contribute to their long-term goals. By having a clear list of things to avoid, companies can conserve time, energy, and resources for activities that drive success.

What example does the speaker give from Steve Jobs' approach to strategy at Apple?

The speaker references Steve Jobs cutting back Apple's product line from hundreds to a handful, focusing on simplifying logistics and waiting for the next big thing. This strategic decision helped Apple regain its competitive edge and financial stability.

How does the speaker compare a business strategy to a sat nav (GPS)?

A business strategy is like a sat nav because it helps determine the destination (vision) and provides multiple routes to navigate obstacles along the way. Without knowing the destination, the business has no way to measure progress or adjust its course.

What two key areas should businesses consider when developing their strategy?

Businesses should consider their customer base (who they are trying to serve) and their own long-term goals (whether they want a comfortable lifestyle or to grow into a larger company). The strategy will vary depending on these factors.

Why does the speaker emphasize patience and consistency in executing a strategy?

The speaker emphasizes patience and consistency because successful businesses don't abandon strategies quickly. Instead, they give initiatives, such as marketing campaigns, enough time to show results. This steady approach increases the likelihood of long-term success.

What book does the speaker recommend for learning about good and bad strategy?

The speaker recommends the book 'Good Strategy, Bad Strategy,' which discusses strategic decisions made by leaders like Steve Jobs and offers insights into what makes a strategy effective.

What is the final step in the strategy-building process according to the speaker?

The final step is putting down a set of actions or goals that will help the business move toward its long-term destination. These goals should be specific, measurable, achievable, realistic, and timely, aligning with the overall strategic framework.