7 Business Strategy Mistakes You're Probably Making

Businesses spend a great deal of time working on their strategies. It’s one of the most-discussed topics at business meetings, and yet, most organisations are making some critical mistakes.

These mistakes can mean lost opportunities, rocky relationships with customers or vendors, or a hit to your bottom line. Let’s take a look at 7 business strategy mistakes you’re probably making and some tips on how to rectify the problems.

 

1. Failing to Integrate

One of the most basic business strategy mistakes is simply failing to integrate strategy with existing operational plans. You may have the best ideas in the world, but if you can’t integrate them with your day-to-day operations, they simply won’t help.

Encourage integration by including key people from each department in your strategic planning and implementation. Ask for their input and listen carefully to the details they provide. Offer ongoing support as they work to make the changes required by the new plans, and follow up on a regular basis.

 

2. Ignoring Data

Successful strategic planning is built on reliable, current data. If you don’t have reliable data, you don’t have a sturdy jumping-off point on which to build your plan. Charge your CFO with the task of producing a set of current data points that will allow you to get an accurate snapshot of your company from many different angles. This will help you to take a holistic approach to your strategic planning.

 

3. Focusing on Processes Instead of Sales

Running a business requires lots of different systems and processes: developing your website, marketing your brand, organising events, streamlining manufacturing, etc. But if you don’t have consistent sales, your business will flounder.

Prioritise sales over other aspects of your business, at least until you have enough liquidity to spend time and attention on parts of your business that don’t have a direct impact on revenue. Even then, revisit your sales regularly as a part of your business strategy.

 

4. Recruiting the Wrong People

A big part of your business strategy should be to collect the talent that will help you to achieve your goals. Hiring mistakes are common in business, but they can derail your business strategy if you’re not careful.

Recruit and support the kinds of people who embrace your vision for your company. If you don’t, your people may steer your business in a different direction than the one you set out to pursue.

 

5. Pursuing Size Above Everything Else

There’s a common perception in business that says if you’re the biggest company in your industry, you’re also the most profitable. This may be true in some cases, but bigger isn’t always better, and if you focus exclusively on size, you may run into trouble.

Economies of scale do provide significant benefits, but economies of scale are usually exhausted after achieving a relatively small share of industry sales. In the meantime, you can run into the many problems associated with very large businesses: communication issues, branding problems, management flows, etc.

 

6. Focusing on High-Growth Markets

High-growth markets can look very attractive, but there’s no guarantee that they’ll be profitable, and if chasing after these high-growth markets is at odds with your overall business strategy, you could get pulled off course.

Be very careful about moving into new markets. Do your due diligence, and find out how many other companies are trying to move into the same market. Try to keep your business strategy balanced and focused on what you do best.

 

7. Not Including Stakeholders

This is one of the most common business strategy mistakes. It’s not easy to include lots of people in your strategic planning, but when you leave the stakeholders out, you miss out on important opportunities.

People support what they help to create, so when you include key employees from all levels, as well as suppliers, vendors, and other important stakeholders, you build something that’s difficult to achieve any other way: ownership. 

If you’re currently making some of these business strategy mistakes, don’t worry. Most mistakes are fixable, and as you change the way you strategize, you’ll learn, grow, and mature as a business owner.

For insight into the current state of your business' health, try our Healthy Business App by clicking below: