What Are Common Organizational Strategies?

25 May What Are Common Organizational Strategies?

So, you’re ready to take your business to the next level, and you know a powerful organizational strategy is the way to do it. Congratulations! You’re well on your way to accelerated growth, stronger sales, and overall success. 

The only issue is…now you have to figure out which organizational strategy is the right one to throw your company’s resources and reputation behind. And there are a lot of options. 

Never fear. We’re going to break down the five most common (and successful!) organizational strategies that are behind the meteoric growth of some of the most profitable businesses in history. 

We’ll also reexamine the purpose of organizational strategy so you can make an informed and measured assessment of how an organizational strategy would impact your business.

Let’s dive in!

What Are Common Organizational Strategies?

First, let’s start with a disclaimer. 

It’s universally accepted that an organizational strategy must be customized to the unique strengths, weaknesses, values, and vision of the business implementing it to create optimal impact. 

What isn’t optimal, however, is attempting to build an organizational strategy from scratch. 

That’s why strategic best practices call for identifying a style of organizational strategy that aligns with your company’s performance goals, culture, and mission, then tailoring it as needed. The organizational strategies we’re going to examine in this section have proven time and time again to be some of the best strategic foundations that can be leveraged across an array of industries. 

The most common organizational strategies are:

1. Cost Leadership

Cost leadership is an organizational strategy that seeks to maximize market share, drive sales, and build brand loyalty by becoming the lowest cost-producer in their industry, market, or focus.  

By aggressively slashing expenses, companies pursuing a cost leadership strategy can generate healthy profits at service or product price points their competition simply can’t match. Some of the world’s most successful companies, like Walmart, Amazon, and IKEA, owe their success to cost leadership organizational strategy.

2. Product Differentiation

Product differentiation is one of the most common – and successful – organizational strategies in the world. Product differentiation is designed to stimulate sales, cultivate valuable customer relationships, bolster brand perception, and capture market share by creating unique and innovative products and services.

Product differentiation is behind the organizational success of companies like Tesla, Apple, and Nike. Each of these companies effectively differentiates their products and brands from their respective crowds, leading to rewards like:

• Enhanced brand recognition
• Industry-leading customer loyalty
• And reduce price sensitivity

3. Diversification

Diversification is an organizational strategy that positions companies to grow their profits, capture new customer bases, and expand their portfolio by expanding into new industries, markets, or niches.

Much like the well-known investment strategy, organizational diversification mitigates the risks and consequences of unexpected economic or business changes by avoiding putting “too many eggs in one basket.”

What Is the Purpose of Strategy in an Organization?

Now that you’ve been introduced to the three most common organizational strategy examples, it’s time we circle back to a more fundamental topic: the purpose and importance of organizational strategy in your business’ success. 

Organizational strategies aim to provide: 

• A shared sense of direction
• A replicable framework for pursuing organizational goals
• A path toward realizing your company’s vision, mission, values, and culture
• And guidelines for responding to unexpected changes in your market or amongst your consumer base

Organizational strategies accomplish these goals by providing a systemic and data-backed approach to essential responsibilities that can make or break the short, medium, and long-term success of your company. 

For example, implementing an organizational strategy can eliminate the guesswork in business matters like:

• Allocating Resources 
• Outlining Project Scopes
• Determining Growth Tactics 
• Managing the Company Portfolio
• Identifying Effective Key Performance Indicators (KPIs)
• Defining Organizational Roles and their Responsibilities
• And aligning organizational initiatives and efforts with a singular shared goal that can be pursued by everyone from your C-suite to your entry-level hires. 

Organizational strategies also ensure your company is well-positioned to confront unexpected challenges head-on and capitalize on emerging opportunities with confidence. The frameworks, guidelines, and best practices outlined by your organizational strategy will empower your business to adapt, evolve, and pivot as necessary to stay on track to accomplishing your long-term goals.

You Need A Tailor-Made Strategic Solution 

Figuring out what kind of organizational strategy aligns with your company’s assets, talents, threats, and vision is a tall order for a busy executive. 

Let our team of expert strategy consultants lighten the load with their hard-earned experience, unparalleled insights, and top-notch track records of success. Medallion Partners has more than 15 years of experience helping businesses just like yours identify and implement the ideal organizational strategy to stimulate their success. 

If you’re ready to streamline your operation’s success, boost employee productivity and performance, and connect with your customers like never before, contact us today. 

We can’t wait to help transform your vision into a reality!