DREIESKIVA​|Roald Kvam

Strategy in business isn’t just a buzzword—it’s the blueprint for survival and success. The following five models break down the foundational frameworks used by leaders to analyze markets, outpace competitors, and drive sustainable growth.

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1. The Ansoff Matrix: Mapping your path to growth

The Ansoff Matrix is a fundamental strategic planning tool designed to help executives and marketers devise specific strategies for future growth. It provides a clear framework by categorizing opportunities into four distinct quadrants based on products and markets:

• Market penetration: This low-risk strategy involves selling more existing products to your current customer base.
• Product development: Here, a company creates and offers new products specifically for its existing markets.
• Market development: This involves taking existing products and entering entirely new markets or customer segments.
• Diversification: The highest-risk strategy, which requires launching completely new products into brand-new markets.

By utilizing this matrix, leadership can visualize the risk-reward profile of their expansion plans and ensure they aren’t relying too heavily on a single growth lever.

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2. Porter’s Five Forces: Deciphering the competitive landscape

Developed by Michael Porter, this framework is the gold standard for analyzing a business’s competitive environment. It moves beyond simple direct competition to examine five distinct forces that shape industry attractiveness:

• Threat of new entrants: Analyzes how easily new competitors can enter the market and disrupt established players.
• Bargaining power of suppliers: Measures the influence of suppliers; strong suppliers can drive up costs and squeeze margins.
• Bargaining power of buyers: Assesses the strength of customers; powerful buyers can demand lower prices or better terms.
• Threat of substitutes: Evaluates the risk of customers finding entirely different solutions to the same problem.
• Competitive rivalry: Examines the intensity of competition among existing firms in the industry.

Understanding these forces allows a CEO to position their company where the «forces» are weakest or to proactively build defenses against them.

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3. Value Disciplines: Choosing your competitive edge

The Value Disciplines model suggests that a company can outperform its rivals by excelling in one of three core areas, while maintaining a «minimum threshold» in the others:

• Operational excellence: Focuses on delivering products or services faster, cheaper, and with minimal hassle for the customer.
• Product leadership: Prioritizes innovation and offering products that constantly push the boundaries of performance and technology.
• Customer intimacy: Centers on tailoring and shaping products and services to fit the highly specific needs of a customer niche.

The lesson for leadership is focus: trying to be the best at all three simultaneously often leads to mediocrity. Strategic mastery requires choosing a primary discipline and dominating it.

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4. The Growth-Share (BCG) Matrix: Managing the portfolio

Also known as the BCG Matrix, this framework helps companies categorize their various business units or products into four quadrants based on market growth and market share:

• Stars: High-growth, high-market-share units that require heavy investment but promise future returns.
• Cash cows: Low-growth but high-market-share units that generate steady cash to fund other ventures.
• Question marks: High-growth units with low market share; these require careful analysis to see if they can become Stars.
• Dogs: Low-growth, low-market-share units that typically drain resources.

Pro Tip: Leaders should regularly review their portfolio to allocate resources effectively—investing in Stars and Cash Cows while considering divesting Dogs unless they serve a specific strategic purpose.

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5. P.E.S.T. Analysis: Navigating the macro environment

While other models look inward or at the immediate industry, P.E.S.T. Analysis looks at the «big picture.» It is a strategic tool for understanding market growth or decline and identifying the direction for operations:

• Political (P): Examines regulations, stability, and government policies that could impact the industry.
• Economic (E): Tracks growth rates, inflation, exchange rates, and general economic health.
• Social (S): Analyzes cultural aspects, health consciousness, and population growth rates.
• Technological (T): Looks at innovations, R&D activity, and overall technological awareness.

By using these insights, leaders can adapt their strategies to remain resilient against external threats and stay poised to capitalize on emerging global opportunities.