Lafley and Martin’s Five-Step Strategy Model

Amid the current chaotic business landscape, a high-quality product or service is not sufficient to overtake competitors and gain competitive advantage. It takes more than that to differentiate yourself from the clutter. What you will need is a well-crafted strategy that takes into account the company’s aspiration, the external market, and your capabilities. All these factors are thoroughly examined in Lafley and Martin’s Five-Step Strategy Model, developed in 2013 by A.G. Lafley, former CEO of Procter & Gamble and Roger Martin, former Dean at Rotman School of Management.

As the name of the model implies, Lafley and Martin’s Five-Step Strategy Model puts forwards five steps that need to be checked in order to develop a winning strategy. These are further explained below:

1. What is our winning aspiration?

The first step of the model is straight forward. You will need to examine and evaluate the company’s mission and vision. How would you define ‘winning? Where do you want to be in five years now? What are your goals for the future? Do you see the company dominating a niche market or do you want to chase a broader market? These are just some examples of questions you need to answer in order to uncover the business purpose.

2. Where are you going to play?

After identifying your main goals, you will need to look into the ‘areas’ you are going to play.  These can either be narrowly or broadly defined; depending on your business aspirations. You will need to take into account which customers you are going to serve, which markets and product categories you are going to compete in, and which channels you are going to be using.

3.  How are you going to win?

Whatever market you have chosen to enter in the previous step, you will probably face heightened competition as soon as you enter. In this step, you will need to assess how you can position yourself to come out on top. You may choose to pursue a differentiation strategy by providing high-quality products and services, or on the other hand, you may opt for a low-cost strategy by minimizing costs and lowering prices.

4. What capabilities do you need to win?

The next step is to assess your current capabilities and think about what you need to improve in order to win. Considering the goals you have previously set along with your strategic plan, you will need to identify the set of capabilities required to implement the respective organization’s infrastructure such as technology, employee skill, and production facilities.

5. What management systems are needed?

In order to make all previous step work, you will need an effective management system in place.  This step takes into consideration the people behind all this process, which are going to support the organizational processes and the respective strategies in place. People need to be working effectively and efficiently towards a mutual goal in order for success to be achieved.

Close Menu