Strategic Positioning

What Is Strategic Position?

What is strategic positioning? If strategy defines the lens through which all company decisions are assessed, then a company's strategic position is simply the view of a company that results from their strategy-driven decision making.

Strategic positioning is a term that gets thrown around a lot in business circles.

Like warriors on the battlefield of commerce, business leaders jockey to secure the strategic position that is most advantageous for their organizations.

But any good military will tell you that strategic positioning isn't a decision; it's the outcome of a deliberate process. Although you may be able to identify the "high ground", to gain market position you'll have to create and flawlessly execute a strategic plan that drives your all of your company's decisions. In other words, a strategic position isn't the result of single decision. It's the consequence of a series of decisions, all of which have been designed to give your company an edge in the marketplace.

Once you understand the connection between strategic planning and strategic positioning, it becomes easier to envision how your organization can more effectively use strategic development strategies. Here are a few things to consider as you set out to acquire or solidify your stake in the marketplace.

• Consumer focus. There are many different factors that need to be considered in the development of a strategic position. But throughout the process, it's important maintain a focus on consumers. Effective strategic planning culminates in a position that is attractive to a certain segment of consumers. Identify your segment and focus your decision making on those consumers.
• Competitor awareness. Although your strategic position should focus on consumers, you'll also need to be aware of the positions that have been staked out by your competitors. In many cases, your strategic position will exploit an area of the market with relatively low competitive pressure.
• Core competencies. Many business owners make the mistake of targeting strategic positions that fall outside of their company's core competencies. Remember, the real challenge isn't identifying a strategic position. It's getting there and staying there - and your core competencies provide the expertise and emphasis you'll need to do it.
• Resource allocation. In the same way that core competencies affect strategic positioning, your current resource allocation determines your ability to hold your position in the marketplace. For example, if your current mix of resources isn't up to the task of producing high-end product offerings, then a quality-based strategic position isn't a possibility, at least not until you've reallocated resources.
• Repositioning. From time to time, you may need to reposition your brand and your products. The longer you've held your position, the more difficult it will be to reposition yourself with consumers. Even so, plan on conducting periodic strategic position assessments and prepare to modify your strategy, when necessary.

Share this article

Additional Resources for Entrepreneurs

Lists of Venture Capital and Private Equity Firms

Franchise Opportunities

Contributors

Business Glossary