What Can Change In Your Company's Strategy

Every company attacks a problem for a particular target market with a specific solution. Together, these three things comprise the positioning of the company. When the company starts out and is trying to create a beach-head in the brain of the customer, it attacks the problem with a differentiated solution. If it is a star-business, it soon becomes a market leader and creates a new category.

With time however, competitors enter the space and the company is forced to innovate to further differentiate itself. It may also want to expand it's offerings to take care of new market opportunities.

So does this mean that the company changes it's strategy?
What can change in the company's strategy and direction?

While examples like Nokia abound (which completely changed the problem, solution and target market with it's entry into mobile phones), most companies with average luck will do well to focus on the target market and the problem. In other words, the pain that you are trying to fix and the specific group of people with shared characteristics for whom you are trying to solve the pain remain unchanged. What can change is the solution.

For example, let's say you are a company that has a drug (solution) for people with diabetes (target market and problem). And let's say you became the market leader in this space as a result of some new innovation. So you become the category leader in the market defined as "diabetes care and management." Now, you can come up with a number of new medicines, drugs, testing systems, hospitals, preventative care, educational videos, social networking site for diabetics and more. But you cannot change the problem that you are trying to solve. Nor can you move away from the core group of people (diabetics) for whom you are trying to solve the problem.

What if, during the course of business, your research team comes up with a new kind of solution that helps menopausal women? Do you lump it under your original brand?
No!
The target market is different. The problem is different. Therefore, you need a separate brand and preferably a separate or at the very least a separate division to handle this new opportunity.

Your solution can change. But your problem and target market remain unchanged forever during the life of your company.