Study guide: Strategy Sketch and Strategic Planning

📋 Course Outline

1. Strategy and the Strategy Sketch
2. Mapping Resources and Partners
3. Understanding Customers and Competitors
4. Designing the Value Proposition
5. Revenue, Risks, and Costs
6. Values, Goals, and Climate
7. Trends and Uncertainties
8. Using the Strategy Sketch

📖 1. Strategy and the Strategy Sketch

🔑 Key Concepts & Definitions

• Strategy: The unique way an organization creates sustainable value.

★ Must-know

• A strategy distinguishes an organization’s way of creating customer value from competitors’ approaches and aims to maintain that value creation over time.

• The Strategy Sketch combines ten core elements of strategy in a structured, coherent visual tool.

Further detail

• The ten strategy elements are:
  • Resources & Competences
  • Partners
  • Customers & Needs
  • Competitors
  • Value Proposition
  • Revenue Model
  • Risks & Costs
  • Values & Goals
  • Organizational Climate
  • Trends & Uncertainties

💡 Memory Hook

Picture strategy as a black box: the Sketch opens it to reveal ten connected ingredients.

📖 2. Mapping Resources and Partners

🔑 Key Concepts & Definitions

• Resources & Competences: What an organization has, what it is good at, and what makes it unique.
• Partners: The people and organizations an organization works with that make its products or services more valuable.

📝 Essential Points

• Assessment questions include: What means the organization has that others lack, What it does especially well, What slack resources it can access, What it would miss if lost, Which competences enabled its resources

• Potential partner questions include: Which organizations have formal contracts, Whom the organization depends on or frequently works with, Who supports it most, What useful contacts partners have, Which beneficial organizations with shared interests are not yet partners

📖 3. Understanding Customers and Competitors

🔑 Key Concepts & Definitions

• Customers & Needs: The people and organizations served and the needs the organization fulfills for them.
• Competitors: Organizations customers compare with an organization when deciding whether to buy its products or services.

📝 Essential Points

• Customer analysis asks: Who uses or pays for a product or service, Who influences buying decisions, What needs and problems customers have, What they are willing to pay for

• Competitor analysis considers:

  • Organizations offering similar products or services
  • Potential entrants
  • Substitutes
  • Alternatives customers compare with the organization

💡 Memory Hook

Customers reveal whose needs are served; competitors reveal whom those customers compare against.

📖 4. Designing the Value Proposition

🔑 Key Concepts & Definitions

• Value Proposition: The products and services an organization offers, how it offers them, and the added value they provide to customers.

📝 Essential Points

• A value proposition should focus on the essence of the offer rather than attempt to describe its value completely.

• Developing an offer can involve:

  • Improving features
  • Expanding features
  • Adding features
  • Simplifying features
  • Downgrading features
  • Dropping features
  • Offering related or complementary products and services

📖 5. Revenue, Risks, and Costs

🔑 Key Concepts & Definitions

• Revenue Model: What an organization receives in return for its offer, from whom, how, and when.
• Risks & Costs: The financial, social, and other risks and costs an organization bears and how it manages them.

📝 Essential Points

• Revenue analysis asks: Who pays, What they pay for, How much they pay, How or in what form they pay

• Risk and cost analysis considers the risks and costs associated with each other strategy element, their size and bearers, and which are necessary or avoidable.

💡 Memory Hook

Revenue is what the organization receives; risks and costs are what it bears.

📖 6. Values, Goals, and Climate

🔑 Key Concepts & Definitions

• Values & Goals: What is important to an organization and where it should go in the future.
• Organizational Climate: The structure and culture characteristic of an organization.

📝 Essential Points

• Climate assessment examines:

  • Task definition and division
  • Power
  • Communication
  • Characteristic symbols
  • Rituals
  • Stories

• Values and goals can be examined through:

  • Decisive criteria in past decisions
  • Achievements in the past three years
  • Shared understanding of official values
  • Stakeholders
  • Long-term ambitions

📖 7. Trends and Uncertainties

🔑 Key Concepts & Definitions

• Trends & Uncertainties: Developments in the broader environment that affect an organization and the uncertainties it faces.

📝 Essential Points

• Environmental analysis asks: Which industry and societal trends are important, What will definitely change in the next few years, What major uncertainties the organization faces

• Possible responses include:

  • Exploiting opportunities
  • Turning threats into opportunities
  • Moving to a more favorable environment
  • Reducing dependence on changes

📖 8. Using the Strategy Sketch

★ Must-know

• 🔄 Use the Strategy Sketch through these steps:
  1. Assemble diverse relevant participants
  2. Display the Sketch on a large sheet or digitally
  3. Map the current strategy across ten elements
  4. Generate ideas
  5. Develop the three best ideas into a coherent Sketch
  6. Test ideas with customers, suppliers, employees, and others
  7. Evaluate and repeat until the strategy is ready to execute

Further detail

• The Strategy Sketch can map the current strategy, support development of a new or improved strategy, and monitor changes within and outside the organization, for example monthly.

💡 Memory Hook

Map the current state, generate ideas, develop the best three, test, evaluate, and repeat.