How Do Functional Tactics Compare To Business Strategies

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What is the tactic?

The word tactical, which comes from the Greek taktikós, originally referred to the disposition of combat troops before battle.

First, when we talk about tactics, we are more in the operational sphere. To stay in the warrior vocabulary, tactics are a bit like the theater of operations, the battlefield where feints and attack/defense by surprise or not, side by side with threat, dodge, and pursuit or even counter-attack.

Also, when we talk about tactics, we are generally on a short-term, or even very short-term, vision.

To image and make concrete examples applied to the company, we can find this kind of tactical actions:

Rent a stand at the Salon de la Maison

Manage a Facebook page by sponsoring posts and creating games

Establish a calendar or a commercial action plan

Send a follow-up email

Add a page to your website about a new product or service

Write a blog post

Start a campaign on Google Ads

Set up a Street Marketing operation

Train salespeople in social selling

Schedule a radio sales promotion campaign

Edit and distribute a flyer

Relaunch your database

These operational actions, however valuable they may be, cannot and should not be carried out without strategic reflection.

Why? Because if we carry out these actions correctly but without making the right choices, the results will be very disappointing. Hence the interest of the strategy.

What is the strategy?

The word strategy also has military and Greek origins ( strategos ).

In business, we talk more about “how are we going to go about achieving the vision? ” 

We are therefore in what is considered to be the long term, that of main lines and major projects.

The perspective is rather long-term. This is about winning the war, not a battle.

It is, therefore, necessary to make the right choices at the start, even if a strategy can be reviewed annually to make corrections if necessary.

The strategist is the one who shows the course, the objective, to be reached and advocates stability during the storm and the tactical actions of the battlefield.

What different business models are there?

The innovation literature offers several standard business models that can be adapted to the organization and its environment. With creativity and background knowledge, a new business model can be created.

The main business models in use today reflect the following three business models from the literature:

How Do Functional Tactics Compare To Business Strategies
How Do Functional Tactics Compare To Business Strategies

A business model focused on efficiency also known as Cost Leadership

This model emphasizes efficiency. By producing more efficiently, products and services can be offered more cheaply. This is partly due to the fact that economies of scale can be achieved. Process innovation is often crucial for an efficiency-based business model.

One premise is to extend the value proposition by using the cross elasticity of a complementary offering. This means, for example, that a farmer shifts his offer from just selling his cheese towards an experience on the farm and selling cheese for tourism, for example. This allows the farmer to get more out of his products and expertise.

Perceived value model (perceived value model)

This business model emphasizes products that are seen as a premium. People want the product because of the value they attach to it. An example of a company that uses this business model is Apple. Products are sold for a higher price, which makes this business model desired by many companies.

The major disadvantage of this business model is the fact that competitors put more or less the same product on the market only for a lower price. Marketing, brand value, and perception, therefore, play an important role in this business model.

A business model focused on Networking

Also known as loyalty-based models, these business models allow for repeat purchases from regular customers. When this business model is properly applied, consumers will act as ‘ambassadors of the product.

In this way, a vicious circle is thrown at it that ensures that the group of loyal customers continues to grow. You see this reflected in, for example, companies such as Swapfiets and HelloFresh.

Corporate strategy vs business strategy

The differences

The difference between corporate and business strategy is its scope. Corporate strategy focuses broadly on issues that affect the company as a whole.

The business strategy focuses on a specific business unit and deals with specific problems. Typically corporate strategy is developed at a higher level by a board of directors, while the business strategy may be made up of a line of independent managers.

Which one to use

Both corporate and business strategies are important and both should be used in any company. However, they must be used differently. A business strategy should be used to address general issues, while a business strategy should be used to address specific problems.

In general, corporate strategies are more stable and should not be changed frequently. A business strategy, on the other hand, can be changed regularly in order to respond to changes in the market.

Leadership and implementation of the strategy in the company

The implementation of the strategy is essential to achieve the sustained development of our companies in the face of the challenges they face to satisfy the needs and demands of an increasingly competitive market. This is part of the strategic management process, which essentially has three phases: planning or formulation, implementation, and control.

The implementation of the strategies involves all the functions and people of the company, but the strategic apex is responsible for evaluating and leading the three essential elements of this process: strategic change, formal and informal structure, and culture.

Due to the above, it is considered that the role of leadership is decisive in this phase of strategic management since the positive or negative results depend on it.

Leadership is an art or process to influence people so that they carry out a certain activity. People follow those who are bearers of satisfaction of their needs and interests.

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