These five Ps describe what makes up a successful strategy. These elements are interrelated and interdependent. They interact with each other to create the context within which strategies are implemented.
1. Strategy as a Plan:
The first element is a plan. It defines the direction in which the organization must go over time. A strategy should be developed before the organization starts acting upon it.
Planning is one of the essential parts of the strategy formulation process; therefore, spend some time brainstorming ideas for new opportunities. Practical tools such as PEST analysis, SWOT analysis and realistic business planning can be used to form an effective strategy.
2. Strategy as a Pattern:
The second element is a pattern. It provides a framework for action. A strategy is a collection of patterns.
In some cases, strategy arises out of previous organizational behaviour. Instead of being an intentional choice, developing a consistent and successful approach can become a strategy. For example, McDonald's' strategy was based on the idea of consistently offering low-cost food. This led them to develop a system of franchising and standardized operations.
3. Strategy as a Position:
The third element is a position. Positioning refers to how you choose to present yourself in relation to others in the marketplace. By doing so, strategy enables you to explore the fit between your business and its environment, allowing you to create a sustainable competitive advantage for your company.
Positioning involves choosing a unique value proposition and positioning your brand accordingly.
4. Strategy as a Perspective:
Choices made by organizations depend heavily on their cultures. The way organizations see themselves shapes their perspectives, and the things they're good at doing become part of who they are.
The perspective of an organization also affects how they perceive their customers and competitors. An organization that focuses on providing excellent customer service could base their strategy around this. Another organization might base their strategy around being the lowest-priced provider.
5. Strategy as a Ploy:
A ploy is a set of tactics used to implement the strategy. Disrupting rivals, discouraging their attempts at disruption, and influencing them through persuasion can be part of a strategy. Strategy can be both a ploy and a plan.
A strategy may include several ploys. For example, Apple's strategy included:
- Making computers affordable.
- Using software design to make users feel comfortable with their products.
- Creating a loyal following among consumers.