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Strategic positioning is the positioning of an organization (unit) in the future, while taking into account the changing environment, plus the systematic realization of that positioning.
The strategic positioning of an organization includes the devising of the desired future position of the organization on the basis of present and foreseeable developments, and the making of plans to realize that positioning.
The strategic positioning method is derived from the business world. The method is aimed at ensuring the continuity of the organization. The strategy determines the contents and the character of the organization's activities.
Terms, such as survival, legitimacy, market positioning, relationship with environment and choice for a certain work area, come up in this context.
Subjects which have been developed reasonably well in literature on strategic management include: information collection techniques, analysis techniques and planning schemes. Not or hardly developed are methods for exploring the future.
Various questions must be asked with strategic positioning:
We will deal with the following aspects:
Each futurology is based on the past and present. Whether the future is predicted from the flight of a flock of ducks, or from the way in which coffee grounds spread under a turned cup, or from thoughts of wise men: the waves of the future are always interpreted on the basis of the wavelets which are already visible in the present.
Trend research according to Naisbitt (shifts in the basically closed news circuit) is based on small shifts which announce future developments. If we can get hold of today's trends, we may perhaps extrapolate them into the future.
It is important for everybody to map the non-volatile developments which are relevant to the own organization. A first exploration of the strategic positioning can be constituted by extrapolating the trends and by gearing them to the field in which the own organization operates.
The steps to be taken are internal research and external research.
Where does our organization stand? What internal factors are decisive for survival and for failure or success, both in a positive and in a negative sense? It is advisable to draw up a list of own relevant criteria, which are applicable to the branch you are working in.
This will help determine the strong and weak points of the own organization.
What influences from outside can be of decisive importance to the realization of the organization's objectives? Or: what external critical factors are there?
Model lists of such factors are available but the organization should come up with its own relevant criteria, which do not only belong to the sector but also, for instance, to region-specific developments. This will help describe the opportunities and threats of the organization.
Future opportunities and threats are also mapped occasionally by making use of extrapolation (trend curves or mathematical models) or by consulting experts in a systemized way. Or by making one or more empirically founded, plausible constructions of the anticipated developments (scenarios).
One can make an analysis of the strategic position by confronting the data of the internal and external researches with each other. An often used method is the SWOT analysis. Four lists of factors are drawn up: Strong Weak Opportunity and Threat. This is usually done in a group meeting of members of the organisation.
Another method is the Product/Market Matrix. Questions raised with this method are: Can you, departing from the existing product range, think of new applications (markets)? And can you supply markets where you are already on firm ground with a variation on your product? (Example: New Zealand sheep farms inventing a new application of wool at times of stiff competition on the wool market: absorption of oil spills at sea, being an existing product on a new market.)
A third method is the Portfolio analysis, which is derived from stock exchange operators wondering: "Which securities must we keep and which must we sell?". A specific portfolio is that of the Boston Consultants Group, which holds the investment or the growth of the branch of industry (Y-axis) against the profit or the market share (X-axis). Four fields then come into being: the stars, the milk cows, the wild cats and the dogs.
Note: for NGO's, the term profit has to be translated in the immaterial yield that should be derived: some distress that is eased; some social interest that is served. The instruments of strategic positioning are derived from business but are fit to serve NGO's as well.
On the basis of the analysis of internal and external critical factors - so, on basis of the estimated chances of seizing opportunities and meeting threats - the positioning will be determined. It would be quite nice to make a very specific positioning choice: we aim at becoming an organization which ..... (a description follows, by what the position choice is characterized, in terms of products, customers and image).
Once such a choice has been made, it should be studied what strategy is appropriate to realize that choice of position. In literature rough strategies are indicated, such as stabilization, growth, shrinking and turnaround. The organization can probably indicate much more specifically and accurately what strategy must be opted for. Growth in a certain direction, orientation towards a certain market, etc.
The main thing of implementation is that, departing from the future positioning choice, theory is translated into what is to be done in order to realize that positioning.
Example of elements of a strategic plan
Business plan, for instance aimed at:
Product plan, selection of products or services, determination of their quality, effect of a product (result for customer).
Marketing plan, aimed at marketing mix: product policy, promotion policy, distribution policy and price policy (cost price/ market price/ competition price?).
Production plan, choice of location, choice of equipment and of the production process, production standards, layout. Production planning, production management, stock control, quality control, cost control, maintenance.
Research plan, technological innovation or product modification.
Personnel & Organization plan, positions, recruitment and selection, career development, organizational structure, training and education, organization culture, performance assessment, terms of employment, relationship with the representative advisory committee, organized consultations, trade unions, promotion policy.
Purchase plan, evaluation of suppliers, account management, make-or-buy.
Logistical plan, transport management, stock and handling, run-through times, term of delivery.
Financial plan, registration and evaluation of financial data, responsibility for availability of financing.
Information plan, gathering and processing of data.
Quality plan, consistency, competence, responsibility, accessibility, respect, communication, credibility, understanding, safety, appearance.
Public Relations plan, both internal (mission, propagation of business objectives, motivation of staff) and external.