What is organizational strategy?

Organizational strategy is an activity to achieve a long-term goal with effective planning and practice. In an organizational strategy, the company takes the initiative to prepare a strategic plan with the involvement of all levels of employees to ensure the proper functioning of a business. The organizational strategy depends on culture, staff involvement, values, and an organized system of an organization. In a marketing and sales company, there must be an organizational strategy to promote a brand effectively.

Organizations must focus on customer or client satisfaction on a priority basis. Marketing organizations choose and hire skilled marketers who have the potential to improve their sales activity within the industry. Management also needs to focus on the development of goods and services for higher productivity. The distribution of products should be in an organized manner with a clear understanding of customer tastes and preferences.
Nowadays, technology plays a vital role in the market to promote a brand or a product and advertise services. Marketing managers have to identify all aspects of organizational and marketing situations or conditions to advertise a brand effectively. Organizational strategy is a process wherein management understands and analyzes the best way to define a product. This strategy also guides managers to understand the needs and expectations of the customers to make rational and effective marketing strategies.

An image of an overview of organization and culture
Figure 1: An image of an overview of the organization and culture.
CC-BY | Image Credits: https://commons.wikimedia.org/ | Menchiearmillo

Process in an organizational strategy

Every plan and action plays an important role in an organization. Therefore, before implementing any strategic plan into action, organizations need to check and review it first to avoid any risk of uncertainty and losses. The organizational strategy should be based on the market concept while shaping a marketing and organizational structure in a systematic way. The organizational strategy should act as an ultimate guide to the direct step-by-step process of business objectives, marketing, digital marketing, content marketing, and product marketing.

  1. A company should encourage each member to participate, involve, and contribute to organizational strategies as their ideas and opinions will provide a clear picture for achieving organizational goals.
  2. Discussions should be done before formulating a strategy to avoid uncertain future events and issues.
  3. Marketing managers should conduct proper training and development programs for marketing teams and motivate them to make an effective strategic plan to achieve a common goal.
  4. In an organizational strategy, all members, including the marketing team, should participate in formulating a marketing plan.
  5. Strategies should be planned for long-term goals, and the presence of the business and corporate strategy is a must for goal-oriented objectives.
  6. Marketing managers should ensure that other concerned marketing teams are following the same corporate strategy to gain a competitive advantage in the market.
  7. Organizational strategies should have more backup plans while launching a new product in a new market. Products should be well defined in terms of the segmentation of the marketing mix.
  8. Methodology and analogy should be accurate and effective for an inbound marketing strategy to attract customers. For this, companies can encourage a greater number of marketing campaigns. In marketing, overall research is necessary to plan an organizational strategy, especially in E-commerce, B2B marketing, product development, or advertising a product via social media.
An image of a business plan does not always work, so one has to make a new plan accordingly.
Figure 2: An image of a business plan does not always work, so one has to make a new plan accordingly.
CC-BY | Image Credits: https://www.maxpixel.net/ | Max Pixel

Types of organizational strategy

  1. Corporate-level strategy: It is a combination of the multi-level company where more than one company’s leaders or managers are concerned to outline and define various goals and achievements.
  1. Business level strategy: This is the first step or approach by a company in a marketplace. Here, organizations go for complete research work and make an analogy about market conditions to run a smooth business.
  1. Functional level strategy: This strategy mainly deals with day-to-day, short-term goals and achievements to support business goals.
An image of the types of organizational strategy
Figure 3: An image of the types of organizational strategy.
CC-BY | Image credits: http://www.free-management-ebooks.com/ | Freemanagementbooks

Limitations/challenges of organizational strategy

  • Sometimes, the planning process fails due to a lack of knowledge. When a company devises a strategy for a long-term goal, analogy and proper research become vital for the execution phase.
  • The planning process requires skill-based knowledge. Sometimes, it becomes difficult to hire appropriate resources for this task.
  • Devising an organizational strategy is a time-consuming process and requires high costs and capital.
  • It is a complex process. Therefore, its implementation becomes difficult.
  • The organizational strategy might fail due to a lack of knowledge of the proper utilization of resources.

Common Mistakes

Students often confuse between an organizational strategy and organizational development. Some question whether an organizational strategy is a part of operations or HR management. The same issue can be seen in their exam performance which creates a negative impact on their campus interviews. Therefore, teachers must conduct debates, group discussions, and role-play activities among students.

Context and Applications

Organizational strategy is a fundamental topic in marketing and is important for other courses of study like Bachelors of Business Administration (General), Diploma in Human Resource Management, Masters in Business Administration (General), and Post Graduate Program in Management,

While studying organizational strategy, it is important to read the following topics to understand the concept better:

  • Corporate-level business
  • Strategic plan
  • Training and development
  • Business strategy
  • Strategy management
  • Employee involvement
  • Strategy skills
  • Marketing environment
  • Marketing mix
  • Digital marketing

Practice Problems

1. Which of the following is a strategic dimension?

  1. Creativity
  2. Supply
  3. Innovation
  4. Time

Answer: c

Explanation: Innovation in business is the most common and important part of any organization, especially when companies handle and deal with strategic actions based on time and situations.

2. Which strategy is used by an organization when there are multi-level plans within a business?

  1. Contemporary
  2. Method based
  3. Corporate-level
  4. Operation based

Answer: c

Explanation: A corporate-level strategy is used when a business considers a multi-tiered organizational plan to achieve goals and objectives.

3. If an organization sets out to be the low-cost producer, then they follow:

  1. Operational strategy
  2. Low-cost leadership strategy
  3. Focus on quantity
  4. Strategic plan

Answer: b

Explanation: Low-cost leadership strategy is an organizational plan that focuses on providing more valuable goods and services than other companies while reducing the overall cost. So, to reduce the cost of a particular product, a company must follow a low-cost leadership strategy.

4. Which among the following is not the type of organizational strategy?

  1. Corporate-level strategy
  2. Foundation level strategy
  3. Business-level strategy
  4. Functional level strategy

Answer: b

Explanation: There are three types of organizational strategies that are corporate-level, business-level, and functional-level strategies.

5. If an organization plans a strategy for a long-term goal, how much time will it take to achieve it?

  1. 1 year or more
  2. Within a specified span of time
  3. 6 months
  4. 1 week

Answer: a

Explanation: It is apparent that if an organization plans for a long-term goal, a strategic plan needs time, and it will be successful only when all possible solutions and practices are followed in an effective manner. Therefore, the time duration to achieve long-term goals is one year or more.

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