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Strategic Planning: Sticking to One Business Unit Level Strategy

Selecting only one business unit level strategy to lead with in your strategic plan is widely considered one of the best ways to achieve and maintain your competitive advantages. Why? Because if you select two or more approaches and then fail to achieve them, your organization gets stuck in the middle without a competitive advantage.

If you’re tempted to execute several strategies at once, think again. That’s called being stuck in the middle, or riding the fence. Executing a stuck in the middle strategy is like being in the middle seat of a five-seat row on a 747. You don’t know whether to crawl over the mom with her sleeping baby to the right or over the guy with his laptop to the left.

Practically speaking, when it comes to budget time, you need to decide whether you’re investing in R&D (product leadership) or eliminating costs out of your supply chain (low cost leadership). You need to do the standard value-creating activities across all strategies, but you need to differentiate yourself with the combined set of activities in these strategies.

That said, another school of thought is that leading with one business level strategy isn’t always best because within the same product or service, customers want the best product, lowest cost, and high touch experience.

Strategic plans are difficult and confusing enough, so to add complications by leading with multiple strategies muddies the water and leads to confusion when hard decisions need to be made. If you must, prioritize what strategy you’re leading with and which two are secondary so when it comes to focus, your team is clear about your choice.

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