Business Strategy Transformation: Lafley and Martin 5 Step Strategy Model

Lafley and Martin 5 Step Strategy Model

In 2013 Lafley and Martin published their 5 Step Strategy Model in their book Playing to Win. These five questions help you to clarify your company’s strategy to position yourself in the best possible way in your market.

  1. Winning aspiration
  2. Where will we play?
  3. How will we win?
  4. Capabilities needed?
  5. Management systems required?

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What is our Winning Aspiration?

This is asking you to focus on the goal of your business. Where do you want to be in five years time. You need to address this objectively but at the same time bring your vision and ambition to formulating your goal. You should be able to explain this very succinctly to your audience, whether they are employees, shareholders or customers.

Be realistic but aim high. By clearly thinking through this goal you are going to force yourself to be constrained and directed by it in the future sections of this model.

Where will we play?

This question is asking you to define and identify the markets you want to operate in and the potential customers you want to sell to. You will need to decide whether you are going to be selling direct to your customers or whether you need to develop channels to your target market through intermediaries.

How will we win?

What strategies are you going to develop to ensure that your product and service is differentiated from your competition? Every business has competitors and when you understand how they operate and differentiate, then you can devise more effective competitive strategies to out sell them. And no, that is not easy.

Just remember the problem you are solving and what your customers want. Devise your strategies to deliver that. Whether you differentiate on price or quality or customer service, find a way to make your customers want to buy from you and not your competitors.

You can use SWOT analysis to help you to understand the Strengths and Weaknesses of your business and to evaluate your Opportunities and the Threats facing you.

What capabilities must we have in place to win?

Now you are being asked to look at execution. This will require skills, staff and infrastructure to ensure that you can compete successfully in your chosen markets and provide your products and services to your target customers. Without these, you cannot achieve your goal.

What management systems are required to support our choices?

You will need the right skills in your management team to implement your strategic choices. This means everything from finance to HR, procurement to sales and marketing, and of course CEO leadership skills.

If you follow this sequence and use it as a template for debate you will be able to use this framework to develop your strategic positioning and competitive USP.

Model Summary

Martin emphasises that in order to use the framework effectively you need to evaluate your strategic choices simultaneously and not sequentially. Each step loops back to the one before it so that your discussion continually evolves and this helps to prevent you going down an uncompetitive cul-de-sac or getting stuck at the “How will we win stage?”

In particular, you need to make sure that you consider “Where to play” in conjunction with “How will we win?” If you cannot work out a winning strategy in your chosen market, you have chosen the wrong market and need to re-evaluate “Where to play”. Can you identify what Martin calls “Matched Pairs” of Where and How which you can then compare against each other and against your Winning Aspiration.

Find Out More

Are you struggling with your Business Strategy?  Take a look at this video which explains Lafley and Martin’s Five Step Strategy Model in just over Six Minutes.

If you want to discover more great Business Strategy and Entrepreneurship content, take a look at my Six Minute Strategist Academy by following this link – https://thesixminutestrategist.teachable.com/p/entrepreneur-finance-membership/

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