{"id":1760,"date":"2015-11-24T00:08:59","date_gmt":"2015-11-24T00:08:59","guid":{"rendered":"https:\/\/courses.candelalearning.com\/waymakerintromarketing1xmaster\/?post_type=chapter&p=1760"},"modified":"2024-05-13T20:11:01","modified_gmt":"2024-05-13T20:11:01","slug":"reading-strategy-and-tactics","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/waymakerintromarketingxmasterfall2016\/chapter\/reading-strategy-and-tactics\/","title":{"raw":"Reading: Strategy and Tactics","rendered":"Reading: Strategy and Tactics"},"content":{"raw":"

Definitions<\/h2>\r\n
A strategy is a directed course of action to achieve an intended set of goals.[footnote]Mintzberg, H. Ahlstrand, B. and Lampel, J. Strategy Safari : A Guided Tour Through the Wilds of Strategic Management, The Free Press, New York, 1998.[\/footnote] \u00a0A tactic is the means by which a strategy is carried out.\u00a0[footnote]http:\/\/www.businessdictionary.com\/definition\/tactics.html<\/a>[\/footnote]<\/blockquote>\r\n

Background<\/h2>\r\n[caption id=\"attachment_1004\" align=\"alignright\" width=\"450\"]\"Photo Plan of the battle of Chantilly, Virginia, fought in 1862.[\/caption]\r\n\r\nLong before the word strategy<\/em> had meaning in\u00a0business, it was used in the context of war. In that context it came to mean\u00a0the battle plan devised\u00a0by one side in order to gain\u00a0an advantage or victory over an opponent. The term tactics<\/em> referred to the specific short-term actions taken by soldiers on the battlefield to\u00a0support the strategy.\r\n\r\nMilitary strategy and business strategy have many things\u00a0in common. Both include uncertainty, making it more challenging\u00a0to achieve desired results. Often there\u00a0are many variables or factors\u00a0that will interact in unpredictable ways. Finally, there is a combative or competitive aspect that drives both kinds of strategies: the participants keenly watch the events unfold and adjust their strategies and tactics\u00a0along the way in order to win. Whether it's a battle or an economic downturn, the complexity and unpredictability of events underscores the need for a broad strategy that factors in\u00a0as many contingencies as possible.\r\n\r\nA business strategy must take into account the changing environment and identify a plan that will use the company's resources most effectively to achieve its mission and goals.\r\n

Differentiating Strategy and Tactics<\/h2>\r\nLet's look at some specific characteristics of business strategy and consider how strategy differs from tactics.\r\n

Strategy Identifies\u00a0Where We Will Compete<\/h3>\r\nThe strategy determines which markets we will pursue, where we will sell our goods and services. It focuses efforts on a specific target market.\r\n\r\nTactics indicate specific actions that we will take in those markets.\r\n

Strategy Describes\u00a0the\u00a0Unique\u00a0Value for Customers<\/h3>\r\nWhen developing a strategy, the aim\u00a0is to identify\u00a0unique benefits in the products or services that customers value and that differ\u00a0from what competitors offer. A strategy should define and clarify the unique value.\r\n\r\nTactics include the tasks of creating, delivering, and expanding the value.\r\n

Strategy Explains\u00a0How the Company's Assets Will Create Unique Value<\/h3>\r\nHow do the company's activities interact and reinforce one another? \u00a0For an organization to define a strategy that creates a unique and valuable position, it must bring together and align the various capabilities and resources\u00a0of the business.\r\n\r\nTactics are planned to reinforce this unique value. Effective tactics, or specific actions, must support the strategy in order for the customer to have a consistent experience with the product or service that aligns with the unique value that the company is seeking to deliver.\r\n

Strategy Determines\u00a0How the Company Will Sustain Unique Value[footnote]Kryscynski, D. (2015, January 5).\u00a0What\u00a0is strategy<\/a>[\/footnote]<\/h3>\r\nOver time, competitors will try to eliminate the company's advantage or copy the areas where it is successful. How will the company continue to provide unique value and protect or expand the areas in which\u00a0it has an advantage?\r\n\r\nAs the company refines its strategy to retain or expand its advantage, the tactics must also be adjusted to execute the strategy effectively.\r\n

Strategy and Tactics in Practice<\/h2>\r\nIn each case, strategy defines the high-level plan. Tactics include the steps taken to execute that\u00a0plan. The following examples show how strategies and tactics are employed by real\u00a0businesses.\r\n

Strategy and Long-Term Planning: Southwest Airlines<\/h3>\r\n

Strategy\r\n\"Southwest<\/a><\/h4>\r\nIn\u00a0its\u00a0early days, Southwest Airlines' strategy focused on being the low-cost airline of choice for leisure travelers. Prior to 2008\u00a0the company recognized that without expanding its target market, it could not sustain growth. The company expanded its\u00a0target market to include business travelers, without compromising the low cost and inviting brand that appealed to leisure travelers.\r\n

Tactics<\/h4>\r\nTwo programs provided tactics to support this shift. The company began to offer\u00a0a Business Select service, which includes\u00a0perks such as early boarding, priority check-in, and a free alcoholic beverage for\u00a0those purchasing\u00a0a premium fare. Early Bird Check-in provides automatic check-in, which allows the customer to board early.\r\n\r\nAccording to CEO Gary Kelly, Southwest does \u201cSix percent or seven percent of our boardings by Business Select, [and] probably more than double that by Early Bird.\u201d The combined direct revenues from the programs were nearly $295 million in 2013.[footnote]http:\/\/www.forbes.com\/sites\/airchive\/2014\/04\/22\/southwest-airlines-opens-for-business-customers\/<\/a>[\/footnote]\r\n

Strategy and Focus: Walgreens<\/h3>\r\n

Strategy\r\n\"Photo<\/a><\/h4>\r\nIn the book Good to Great<\/em>, author Jim Collins identifies Walgreens as a company that demonstrates focus in its strategy. After inventing the malted milkshake at the soda counter in its pharmacies, the CEO made a strategic decision to divest\u00a0all food operations over a five-year period and focus on being the most convenient drugstore. Today there are more than\u00a08,200 Walgreens stores across all fifty\u00a0states.[footnote]\"Good to Great: Why Some Companies Make the Leap... And Others Don't<\/em> (Review).\" September 3, 2001. Retrieved 2012-07-13.[\/footnote]\r\n

Tactics<\/h4>\r\nAfter dragging its feet for six months, the management team began a process of closing soda fountains in the stores and selling the Corky's restaurant chain and other food holdings.\r\n

Strategy and Aligned Activities: Zappos<\/h3>\r\n

Strategy<\/h4>\r\n\"Photo<\/a>\r\n\r\nZappos' strategy centers on providing the best customer service in the world. The company was initially founded with three assumptions behind\u00a0its vision:\r\n
    \r\n \t
  1. One day, 30 percent of all retail transactions in the U.S. will be online<\/li>\r\n \t
  2. People will buy from the company with the best service and the best selection<\/li>\r\n \t
  3. Zappos.com will be that online store[footnote]http:\/\/www.zappos.com\/d\/about-zappos<\/a>[\/footnote]<\/li>\r\n<\/ol>\r\nThe emphasis on a strategy of exceptional service for every customer<\/em> drives strategic decisions such as choosing to join forces with Amazon.\r\n

    Tactics<\/h4>\r\nThe strategy is also a point of alignment for every tactic in the organization including the process for interviewing and selecting new employees, decisions about warehousing, and decisions about which products are offered in the company's online store.","rendered":"

    Definitions<\/h2>\n

    A strategy is a directed course of action to achieve an intended set of goals.[1]<\/sup><\/a> \u00a0A tactic is the means by which a strategy is carried out.\u00a0[2]<\/sup><\/a><\/p><\/blockquote>\n

    Background<\/h2>\n
    \"Photo<\/p>\n

    Plan of the battle of Chantilly, Virginia, fought in 1862.<\/p>\n<\/div>\n

    Long before the word strategy<\/em> had meaning in\u00a0business, it was used in the context of war. In that context it came to mean\u00a0the battle plan devised\u00a0by one side in order to gain\u00a0an advantage or victory over an opponent. The term tactics<\/em> referred to the specific short-term actions taken by soldiers on the battlefield to\u00a0support the strategy.<\/p>\n

    Military strategy and business strategy have many things\u00a0in common. Both include uncertainty, making it more challenging\u00a0to achieve desired results. Often there\u00a0are many variables or factors\u00a0that will interact in unpredictable ways. Finally, there is a combative or competitive aspect that drives both kinds of strategies: the participants keenly watch the events unfold and adjust their strategies and tactics\u00a0along the way in order to win. Whether it’s a battle or an economic downturn, the complexity and unpredictability of events underscores the need for a broad strategy that factors in\u00a0as many contingencies as possible.<\/p>\n

    A business strategy must take into account the changing environment and identify a plan that will use the company’s resources most effectively to achieve its mission and goals.<\/p>\n

    Differentiating Strategy and Tactics<\/h2>\n

    Let’s look at some specific characteristics of business strategy and consider how strategy differs from tactics.<\/p>\n

    Strategy Identifies\u00a0Where We Will Compete<\/h3>\n

    The strategy determines which markets we will pursue, where we will sell our goods and services. It focuses efforts on a specific target market.<\/p>\n

    Tactics indicate specific actions that we will take in those markets.<\/p>\n

    Strategy Describes\u00a0the\u00a0Unique\u00a0Value for Customers<\/h3>\n

    When developing a strategy, the aim\u00a0is to identify\u00a0unique benefits in the products or services that customers value and that differ\u00a0from what competitors offer. A strategy should define and clarify the unique value.<\/p>\n

    Tactics include the tasks of creating, delivering, and expanding the value.<\/p>\n

    Strategy Explains\u00a0How the Company’s Assets Will Create Unique Value<\/h3>\n

    How do the company’s activities interact and reinforce one another? \u00a0For an organization to define a strategy that creates a unique and valuable position, it must bring together and align the various capabilities and resources\u00a0of the business.<\/p>\n

    Tactics are planned to reinforce this unique value. Effective tactics, or specific actions, must support the strategy in order for the customer to have a consistent experience with the product or service that aligns with the unique value that the company is seeking to deliver.<\/p>\n

    Strategy Determines\u00a0How the Company Will Sustain Unique Value[3]<\/sup><\/a><\/h3>\n

    Over time, competitors will try to eliminate the company’s advantage or copy the areas where it is successful. How will the company continue to provide unique value and protect or expand the areas in which\u00a0it has an advantage?<\/p>\n

    As the company refines its strategy to retain or expand its advantage, the tactics must also be adjusted to execute the strategy effectively.<\/p>\n

    Strategy and Tactics in Practice<\/h2>\n

    In each case, strategy defines the high-level plan. Tactics include the steps taken to execute that\u00a0plan. The following examples show how strategies and tactics are employed by real\u00a0businesses.<\/p>\n

    Strategy and Long-Term Planning: Southwest Airlines<\/h3>\n

    Strategy
    \n    \"Southwest<\/a><\/h4>\n

    In\u00a0its\u00a0early days, Southwest Airlines’ strategy focused on being the low-cost airline of choice for leisure travelers. Prior to 2008\u00a0the company recognized that without expanding its target market, it could not sustain growth. The company expanded its\u00a0target market to include business travelers, without compromising the low cost and inviting brand that appealed to leisure travelers.<\/p>\n

    Tactics<\/h4>\n

    Two programs provided tactics to support this shift. The company began to offer\u00a0a Business Select service, which includes\u00a0perks such as early boarding, priority check-in, and a free alcoholic beverage for\u00a0those purchasing\u00a0a premium fare. Early Bird Check-in provides automatic check-in, which allows the customer to board early.<\/p>\n

    According to CEO Gary Kelly, Southwest does \u201cSix percent or seven percent of our boardings by Business Select, [and] probably more than double that by Early Bird.\u201d The combined direct revenues from the programs were nearly $295 million in 2013.[4]<\/sup><\/a><\/p>\n

    Strategy and Focus: Walgreens<\/h3>\n

    Strategy
    \n    \"Photo<\/a><\/h4>\n

    In the book Good to Great<\/em>, author Jim Collins identifies Walgreens as a company that demonstrates focus in its strategy. After inventing the malted milkshake at the soda counter in its pharmacies, the CEO made a strategic decision to divest\u00a0all food operations over a five-year period and focus on being the most convenient drugstore. Today there are more than\u00a08,200 Walgreens stores across all fifty\u00a0states.[5]<\/sup><\/a><\/p>\n

    Tactics<\/h4>\n

    After dragging its feet for six months, the management team began a process of closing soda fountains in the stores and selling the Corky’s restaurant chain and other food holdings.<\/p>\n

    Strategy and Aligned Activities: Zappos<\/h3>\n

    Strategy<\/h4>\n

    \"Photo<\/a><\/p>\n

    Zappos’ strategy centers on providing the best customer service in the world. The company was initially founded with three assumptions behind\u00a0its vision:<\/p>\n

      \n
    1. One day, 30 percent of all retail transactions in the U.S. will be online<\/li>\n
    2. People will buy from the company with the best service and the best selection<\/li>\n
    3. Zappos.com will be that online store[6]<\/sup><\/a><\/li>\n<\/ol>\n

      The emphasis on a strategy of exceptional service for every customer<\/em> drives strategic decisions such as choosing to join forces with Amazon.<\/p>\n

      Tactics<\/h4>\n

      The strategy is also a point of alignment for every tactic in the organization including the process for interviewing and selecting new employees, decisions about warehousing, and decisions about which products are offered in the company’s online store.<\/p>\n\n\t\t\t

      \n\t\t\t

      Candela Citations<\/h3>\n\t\t\t\t\t
      \n\t\t\t\t\t\t
      \n\t\t\t\t\t\t\t
      CC licensed content, Original<\/div>