Etsy: Strategy Principles and Concepts Overview

Etsy Case Study
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Etsy Case Study
Strategy Principles and Concepts Overview
A strategy is a set plan of actions that an organization follows in order to achieve specific set of goals. Thus, the purpose of the strategy is to provide a roadmap for how an individual, organization, or business will allocate resources, make decisions, and take actions to achieve their desired outcomes. An organization with a well-defined strategy enjoys benefits such as clarity of direction. Notably, a strategy provide a clear direction for everyone involved, making it easier for them to focus on what they need to do to achieve the desired outcomes. Also, a strategy helps an organization to prioritize allocation of its resources. In so doing, an organization experiences high return on investment as time, money, and resources are efficiently allocated to the various activities that achieve desired outcomes. Another key benefit of a strategy is improved decision making. To this end, strategy serves as a framework for decision-making in the sense that an organization can rely on strategy to ensure that the decisions made align with the goal and direction of an organization. In addition, a strategy provides the means through which an organization can measure the progress towards desired progress.
There are several components of a strategy. First, a strategy should have the vision and mission of the organization. The vision and mission detail the purpose of the organization and details the values and beliefs of an organization. Second, a strategy should include an environmental analysis. The analysis as a component of a given strategy details the current internal and external factors that are likely to have a significant influence on the success of a given strategy. Third, goal and objectives is an essential component of a given strategy. The goal and objective provide specific, measurable, achievable, relevant, and time-bound (SMART) desired outcome for the organization. Fourth, strategy formulation is a key component of a strategy. Strategy formulation define a plan of action that will be used to achieved the defined goals and objectives. Fifth, a strategy should have a resource allocation as a component. To this end, an organization should determine the resources that should be directed towards strategy execution. Sixth, implementation is an essential component of a strategy that involves the actual execution of the strategy. In this component, the organization has to assign responsibilities, develop a timeline, and make sure that every person understand their roles and responsibilities. Seventh, monitoring and evaluation is an essential element of a strategy. It involves regular reporting, analyzing feedback, and making adjustments as needed to ensure that the strategy remains on track to achieve its goals.
Notably, organizations effectively leverage strategy to achieve competitive advantage. The thorough analysis of internal and external environment allows the identification of strengths and weaknesses to develop a strategy that leverages an organization’s strengths and overcomes weaknesses while taking advantage of opportunities and minimizing threats. some of the potential paths through which a strategy offers competitive advantage is encouraging a company to focus on a specific market, encouraging product differentiation, encouraging cost leadership, encouraging the pursuit of innovation, or directing a company to pursue branding and reputation.
There are three levels of strategy. First, there is a corporate strategy, which is concerned with the overall direction and scope of the organization. The strategy at the corporate level involves decisions about the markets to compete in, the businesses to pursue, and the allocation of resources among them. It also includes decisions about mergers, acquisitions, divestitures, and other forms of corporate restructuring. The second level of strategy is business unit strategy that is concerned with how the organization can compete effectively within a particular business unit or product line. It involves decisions about product design, pricing, marketing, and operations and includes decisions about how to differentiate the product or service from competitors and how to achieve cost leadership. The third level of strategy is the functional and operational strategy that is concerned with how the organization can achieve its goals within a specific functional area, such as marketing, finance, human resources, or operations. It involves decisions about how to optimize processes and procedures to support the business unit and corporate strategies.
Policy and strategy are closely related in an organization. Policies are the guidelines, rules, and procedures that guide decision-making and actions in specific areas of the organization. Policy and strategy are interconnected, and policies play an es...