What Is a Strategy in Business? (With Types and Examples)

By Indeed Editorial Team

Published 4 July 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Businesses often create goals or plans they follow, which can require specific strategies. There are many different types of strategies employed by businesses to reach different goals, including team strategies and corporate strategies. Understanding what a strategy is, how businesses use them and what it might look like in practice can help business leaders or development experts help companies create better strategic plans. In this article, we answer the question "What is a strategy?", explore different types of strategies in business with examples, show you who might use a strategy and discuss the benefits of strategies.

What is a strategy?

To understand the answer to "What is a strategy?", consider this definition, a strategy is a method by which a company achieves a specific, measurable goal. Companies that want to grow or expand their customer base might adopt a stronger, more aggressive marketing strategy and companies that want to achieve team cohesion might look for collaboration strategies to improve teamwork. A strategy typically includes a written plan of action, where the business or its leaders can describe exactly what they hope to achieve and how they hope to achieve it within their specified timeline.

Related: Strategy Planning: Definition, Elements and Tips for Success

Strategy types in business

In business, there are many different categories of strategies, each of which serves its own specific function. Here are some types of strategies to consider, with examples to better explain what they might look like in practice:

Corporate strategies

A corporate strategy is the business or organisation's primary strategy for operating within its industry. The corporate strategy dictates how a business supports its values, reaches its customers, produces its products, interacts with and supports its workforce and also how it appeases its shareholders. Businesses typically align their corporate strategies around building stronger internal competencies and leadership frameworks, developing stronger relationships between internal employees and managers and developing values employees can rally around and support in their daily activities. The corporate strategy also includes how the company raises capital and develops its unique branding.

Example: Seaside Food Service is an ingredient supplier for over 500 restaurants. The company's corporate strategy is to own at least 50% of the market share in the industry by providing higher-quality, locally-sourced ingredients with faster delivery times. The company embraces the values of transparency, integrity and quality, allowing customers to visit processing plants and publishing their sourcing and production methods for the public. The business is partially owned by its employees, creating a unique, bottom-up ownership dynamic where employees can influence their work environment and hold the company accountable for its values.

Related: How to Use Strategy Formulation: Definition, Steps and Tips

Business unit strategies

A business unit strategy focuses on how the individual business unit can compete within its specific market. This includes the company's strategies for addressing competitors, mimicking or outperforming its competitors to gain more of a market share and creating a stronger brand image to entice new customers. This strategy links back to specific strategies within the greater corporate strategy as a company's market and corporate strategy typically align if the company wants to be successful.

Example: Li and Hyon, Co. is an established electronics manufacturer with a large percentage of the market share in Hong Kong. With the emergence of three new competitors in the last five years, the company creates a business unit strategy to better define how they can compete with these emerging competitors so they can keep their market share. They perform a SWOT analysis for the company, identifying the strengths and weaknesses of the business and focusing on improving those weaknesses while seizing opportunities to outperform the competitors.

Marketing strategies

Companies use marketing strategies to determine how to reach their customers. Marketing is how a company advertises its products or services, attracts new customers and creates its unique brand image. Companies often focus on marketing strategies throughout the company's lifespan, as markets can change and the business itself can grow or evolve and require new strategies to stay competitive. A marketing strategy might include elements like the company's search engine optimisation strategy, ad strategy and public image strategy.

Example: Tiger and Horn Furnishings is a corporate furniture company that wants to sell its products in Mainland China. They've operated in Hong Kong for 20 years and established a reputation of excellence there, but are relatively unknown elsewhere. The company creates a new marketing strategy for the new market, focusing on the weaknesses of the competitors there to enhance public perception and gain more of the market share. They perform a thorough competitor and market analysis, create marketing campaigns that focus on the quality and price of their products and launch a new website for the mainland market.

Related: Competitive Strategy: Definition and Types (With Examples)

Team strategies

Team strategies help improve employee performance, production and team cohesion. These strategies typically focus on how employees interact with one another and their managers, what motivates them and how to get the most out of each employee to keep the company profitable. These strategies can include things like the company's internal management structure, how the company handles onboarding, disciplining and terminating employees and what HR policies the company has established.

Example: Hong Kong Distributors, Co. is a distribution company that distributes name-brand goods to retail stores. The company's team strategy recently underwent significant changes, as the company found that its policies of encouraging independence and reporting on other employees were dividing its workforce. To combat this, the company developed a new team strategy, dividing the workforce into 12 teams, each with their own direct supervisors and establishing weekly check-in meetings and team exercises to improve collaboration.

Related: How to Write a Strategy Resume: With Template and Example

Management strategies

Management strategies help determine how to organise its internal management structure, how managers interact with employees and what the relationship between managers, employees and company executives might look like. These strategies can also help dictate the specific level of influence or power each management level has over the company as a whole and in their individual departments.

Example: Fong Developments, Ltd. is a property developer that only has two managers for a team of 100 prospectors and developers. The company discovered that the lack of oversight and direct involvement from the company's executives left room for error and some internal profiteering. To combat this, the company reorganises its internal management structure, hiring five new managers, dividing the core employee group into teams and allowing managers to have more power over whether an employee completes a specific deal and the terms of that deal.

Who uses strategies?

Many business professionals use strategies, including:

  • executives, like the company CEO, CFO or CTO

  • managers and supervisors

  • investors and shareholders

  • business development experts

  • business consultants

  • marketing professionals

  • financial management professionals

Related: Co-Branding Strategies for Career Development: Plus Benefits

Benefits of creating a strategy

There are many benefits for a company that embraces strategic planning, including:

  • Fewer errors or setbacks: Strategic planning can help a company set more well-defined goals with specific plans for when setbacks or errors occur, which can help decrease their frequency and severity to minimise their impact on company success.

  • Greater accountability: A strategy typically defines who's responsible for what parts of that strategy, so everyone knows each others' role in the project or business. This increase in accountability can help the team work better together and encourage everyone to do their best work.

  • Higher revenues: A business strategy can help a company learn more about its market, its place in that market and how it can improve its market share. These techniques can help the business become more profitable and increase its overall revenue by focusing on how to leverage market share and attract new customers.

  • Better documentation: Since companies typically document their strategies, they often have better documentation about what they're doing, what they've done previously and where they hope to be in the future. They can use these documents to learn about previous strategies and where they failed or flourished.

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