Scaling Your Business with a Solid Strategy Hierarchy

Scaling Your Business with a Solid Strategy Hierarchy

As a business owner, it’s easy to get caught up in the daily operations and forget about the big picture. However, if you want to scale your business, you need a solid strategy hierarchy that outlines your goals, strategies, and tactics. In this article, we will discuss what a strategy hierarchy is and how it can help you scale your business.

What is a strategy hierarchy?

A strategy hierarchy is a framework that outlines the different levels of strategy in a business. At the top of the hierarchy is the corporate strategy, which outlines the overall direction of the business. The corporate strategy is then broken down into business unit strategies, which outline the direction of each business unit. Finally, the business unit strategies are broken down into functional strategies, which outline the direction of each functional area of the business.

Why is a strategy hierarchy important for scaling your business?

A strategy hierarchy is important for scaling your business because it ensures that everyone in the business is working towards the same goals. Without a strategy hierarchy, different areas of the business may have conflicting goals, which can lead to inefficiencies and missed opportunities.

For example, if the sales department is focused on increasing revenue, while the operations department is focused on reducing costs, the business may struggle to make progress. However, if both departments are working towards the same goal, such as increasing profitability, the business will be more likely to succeed.

How to create a strategy hierarchy

Creating a strategy hierarchy can be a daunting task, but it’s essential for scaling your business. Here are the steps you need to follow:

1. Define your corporate strategy – This should outline the overall direction of the business and the goals you want to achieve.

2. Break down your corporate strategy into business unit strategies – Each business unit should have its own strategy that aligns with the corporate strategy.

3. Break down your business unit strategies into functional strategies – Each functional area of the business should have its own strategy that aligns with the business unit strategy.

4. Monitor and adjust your strategy hierarchy as needed – Your strategy hierarchy should be reviewed regularly to ensure that it’s still aligned with your goals and the needs of the business.

Examples of companies with a solid strategy hierarchy

There are many examples of companies that have a solid strategy hierarchy, such as Apple, Amazon, and Google. These companies have a clear corporate strategy that is broken down into business unit strategies and functional strategies. For example, Apple’s corporate strategy is focused on innovation, which is then broken down into product strategies for each of its business units, such as the iPhone and Mac. Each product strategy is then supported by functional strategies in areas like marketing and operations.

Key takeaways

Scaling your business requires a solid strategy hierarchy that outlines your goals, strategies, and tactics. A strategy hierarchy ensures that everyone in the business is working towards the same goals, which can lead to increased efficiency and better results. To create a strategy hierarchy, you need to define your corporate strategy, break it down into business unit strategies and functional strategies, and regularly monitor and adjust it as needed. Companies like Apple, Amazon, and Google are examples of companies with a solid strategy hierarchy that has helped them scale their businesses.