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Hadit
Student (University)
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Difference Between Strategy Approaches and Strategy Concepts
Hi, can someone please explain the difference between a strategy approach and a strategy concept? I'm not sure if I get it right, but to my mind an approach (like Resource-based View) describes a way to interpret the reality.
Whereas a strategy concept (like Core Competences by Prahalad and Hamel) is based on an approach (RBV) and describes actions in terms of strategies.
Please advise me.
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Elena Zhila
Project Manager, Germany
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Strategy Approach versus Strategy Concept Strategy approach is the way to interpret the problem while a concept is the way to solve the problem.
For example, profits are going down. One approach would be to interpret this as a profit problem and then apply concept revenue-cost, analyze revenue, analyze cost.
Another approach would be to interpret this as organizational problem and use organizational concepts; for example: are people motivated, do the incentive schemes function properly, and so on.
Hope that helps.
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Hakim Moi
Strategy Consultant, United Kingdom
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Strategy Approach versus Strategy Concept Strategy concept is a vision of the future where you or a firm wants to be and therefore needs to do something about getting to there from the current position or situation.
Strategy approach is about development and transformation from where you are to where you want to be, from current situation to the future state or vision that you want to get to.
Concept describes the thought process, model or picture and approach describes the actions to realize the concept (vision).
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Jaap de Jonge
Editor, Netherlands
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Approach versus Concept @Hakim Moi: I agree that:
- A concept is more or less the same as a model. It is a theoretical construct that aims to reflect reality as close as possible. It is a way of representing something in order to understand it.
- An approach is a set of actions (out of more alternatives) aimed at achieving something practical. It is a way of dealing with something in order to act towards it.
Note that there may be considerable differences in how these terms are viewed in context and internationally. There exists no universal "truth" in this matter.
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bernatdo reyes
Strategy Consultant, Mexico
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Strategic Concept versus Strategic Approach - A concept, it is a nonnumerical representation of reality, with the traditional isolated variables that "represent" the phenomenon, a concept it is a theory used to understand what we perceived; it offers a simplified situation that allows to at least grasp what to expect.
- An approach is a perspective of how things could flow, it represents a map for deducing action. It represents our perception of present tendencies mixed with the future we want to build.
Both approach and concept have to be interwoven in any project.
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Shobana Sharma (Shobana Maran), United Arab Emirates
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Strategic Approach versus Strategic Concept In my view, a strategic approach is the way to explain the problem whereas a strategic concept is the way to solve the problem.
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Mehul Doshi
CxO / Board, India
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Strategy Approach Using Resource Based View It is important that your company's strategy approach is based on your company's SWOT and Resource-based View is just one of the options. But even if these are INFLUENCING your Strategy approach, they ARE not necessary your strategy approach.
Why I say influencing is because the Resource Based View validates the strength of your organization's resources which could be its leader, the technologists, the brand, the regional strength or coverage, the relationships with customers for years, etc...
All of these however are only inputs to your Strategy Approach. You should still consider if the resource advantage is actually a differentiator, and if so, if that shall be a temporary advantage or a sustainable one. Sometimes you may have an advantage, but it is not monetization feasible and just adds to the brand reputation.
When you finally apply the strategy approach to the main sections of the business like marketing and sales the strategy becomes tangible.
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John Henry
Project Manager, United States
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Strategy is a Noun It should not be used to describe other nouns.
Approach, is a group of actions, or processes that should result in an outcome.
Concept is an idea, or a model, that is used to formulate or imagine, an out come.
So Strategy, is the desired outcome, it is the vision, and the way to it.
You might use a concept or model to explain your strategy to others.
And you may have strategic approaches to achieve your new reality.
Hope that simple explanation assists...
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Jaap de Jonge
Editor, Netherlands
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The Word Strategy can also Used in a Compound Noun @John Henry: Your first sentence is IMO not correct ("It should not be used to describe other nouns.")
Besides as a noun, the word "strategy" can also be used in many languages including English in so called "compound nouns" like "strategy approaches", "strategy methods", or "strategy models". At 12manage we do that to indicate a collection of these things in the field of strategy. See our discipline page of Strategy methods, models and approaches. In the same way we also have collections of Leadership methods, models and approaches and Marketing methods, models and approaches and 9 more up to the amazing total of... 12.
Of course "strategy methods" is different from "strategic methods". Many people use the word "strategic" more or less as a synonym for "important".
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Warren D. Miller, CPA, CFA
Strategy Consultant, United States
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Abuse of the Word 'Strategic' Jaap, I think your comment about many people using 'strategic' as a synoym for 'important' was spot-on. Thank you for doing that.
In my experience, those who use 'strategic' as a synonym for 'important' don't have any idea what they are talking about. They are trying to make something trivial sound important, when, in fact, it really isn't anything of the sort. When I taught strategic management on the college level many years ago, I saw how abusive the typical use of 'strategic' was, so I forbade the word to be used in the classes I taught, except on examinations and in written reports.
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Warren D. Miller, CPA, CFA
Strategy Consultant, United States
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Strategy is not the Desired Outcome @John Henry: I respectfully disagree, John. In no way is strategy 'a desired outcome.' Instead, 'Strategy' defines how companies compete directly with one another. The breadth of that competition is either 'industry-wide' or in a 'strategic group.'
Most enterprises, especially those that are either closely held or have few employees, or both, compete in a strategic group [SG]. By definition, an SG is a subset of an industry. How that subset is defined varies according to who's doing the defining. In my line of work valuing non-public companies and advising their owners and senior executives, one parameter is invariably geography. That way, the members of a given SG are more likely to compete with one another. The other is typically a range in the number of full-time-equivalent employees (FTEEs). The idea is to have a group of companies that are as similar as possible to the one that I'm valuing.
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