Defining a path to win in today’s game—and tomorrow’s
If corporate strategy is about determining the optimal allocation of capital across a portfolio of strategic business units, the role of business strategy is to deploy that capital to drive growth, generate value, and create sustainable competitive advantage—in other words, to put it to work in the business, in the most effective way possible.
But determining the right business unit strategy is anything but straightforward, and the approach should be constantly refreshed. A business only prospers if it can satisfy the changing needs of its customers both more fully and more profitably than its competitors. Today, with digital disruption blurring industry boundaries and geopolitics challenging long-held assumptions, those needs are changing faster than ever. Adding to the complexity is the fact that different strategic environments call for different types of business strategies.
BCG helps clients chart winning business strategies by focusing on three critical deliverables.
Rich Insight into the Strategic Environment. How are the priorities and options of leading-edge customers changing? Where are today’s profit pools, and how are they likely to evolve or be disrupted? How well are competitors, whether traditional or emerging, positioned to respond? Which combination of choices on where to play—by customers, markets, and investments—has the greatest potential to create value relative to rivals?
A Candid Assessment of the Business’s Real Competitive Advantages. Is the business unit’s right to win based on such factors as cost, capabilities, intellectual property, unique access to data, and position in an ecosystem? Are key moves required to acquire new assets or capabilities that are essential to future advantage?
A Direct and Agile Connection Between Strategy and Execution. What’s the best way to create alignment around the strategy? To set and communicate goals? To create tight market feedback loops that enable rapid learning and adaptation while also ensuring programmatic rigor in execution?
Growth is imperative and possible—but perilous. It drives nearly three-quarters of shareholder returns over a ten-year period, but fewer than half the companies that go for growth create value in the process.
In our study of breakout growers that created value, we found that they did two things right:
Our experience shows that the best growth strategies are built on advantage but stretch the thinking to envision ambitious moves across the core, near adjacencies, and toward new frontiers. And they deliver by concentrating investment on essential capabilities, accelerating M&A to achieve critical mass, funding the journey through productivity enhancement, running growth as a program, and bringing investors along.
In digital transformation, the critical question is, which strategic bets should we make and in what order?
The center helps clients find tomorrow’s best opportunities by mining vast, unstructured data sets for insight.
Strategic environments are increasingly diverse. And different environments call for different styles of business strategy.
The center tracks more than 90 known and emerging megatrends that can provide critical tailwinds to accelerate strategic moves.
BCG began as a business strategy consultant, and throughout the evolution of business strategy, BCG has remained a leader. We have helped:
In order to emerge stronger, companies must ensure that their response to COVID-19 is not just immediate but also transformational.
What do companies that overcame stagnation to deliver value-creating, peer-beating growth have in common? They follow ten best practices for charting strategy and driving implementation.
Digital is still anyone’s game. Organizations that think big, take a holistic view, and move nimbly will find competitive advantage.
The principles of time-based competition—a classic concept among BCG insights—still hold. But today’s companies must be adaptive, as well as fast, in order to succeed.
For some companies, disruption is a risk to be avoided. For others, it’s an opportunity to be embraced. With better sensing, modeling, and planning capabilities, businesses can use upheaval as a catapult to success.
Martin Reeves argues that imagination is an untapped and essential resource for organizations. Listen for more imagination insights on The So What from BCG.
