What is the Strategy Pyramid?
The Strategy Pyramid is a Tool that helps Define Companies Easily.
- It is also known as the Pyramid of Purpose.
There are multiple ways in which this Pyramid can be Designed.
- In 3, 4… or even 12 Steps.
Some are more complex and detailed than others.
However, despite existing different approaches, all of them rely on the Same Principle:
- The Top of the Pyramid Describes the Ultimate Goal of the Company.
- The Middle of the Pyramid Describes its Strategy.
- The Bottom of the Pyramid Describes its Operations.
We think using just these 3 Divisions is much more Practical and Easy to Remember.
Three Stages of the Strategy Pyramid
1. Ultimate Goal: What the Company wants to Be. Its Role in Society.
- Missions (and Visions) are commonly Used as Ultimate Goals.
2. Strategy: The Philosophy that the Company follows to achieve its Goals.
- What principles guide the Company in achieving its Objectives.
3. Tactics: What Actions are taken to Fulfill its Strategy.
- What the Company actually does, How and How often.
We know what you may be thinking right now (we often say this):
- “This is Obvious and Useless“.
We know it.
But trust us: It is very Practical to compare different Businesses.
We have worked in Venture Capital for years, and, when evaluating different Companies, it is very Helpful to have a Visual Tool to Easily Compare them.
- For example, in a Business Meeting.
The best way to understand Strategy Pyramids and how they are used is by sharing some examples with you.
Strategy Pyramid examples
We have chosen different famous and successful Companies and applied the Strategy Pyramid to them.
In this way, you will learn how these companies define their Tactics to meet their Strategies and how these Strategies pursue their Ultimate Goals.
If you knew nothing about these Businesses, these Pyramids would give you a good Idea about them.
Apple - Strategy Pyramid example
Apple’s official Mission is:
- “ To bring the best User Experience to our customers through innovative Hardware, Software, and Services“.
It has varied over the years.
- In the Past, Apple focused more on Products, but Now, they Highlight User Experience.
What Strategy are they Following to accomplish this?
They Have created an Interconnected Environment that:
- Collects lots of Data.
- Processes it.
- Offers Users New Knowledge and a better Experience.
How do they Fulfill this Strategy? What Tactics does Apple use?
They continuously create New Products that Collect more and better data.
- The iWatch collects Health data.
- The iPhone collects Localization, Daily Choices, etc.
- Safari collects Preferences, Preferred Topics.
Apple Strategy Pyramid.
Coca Cola - Strategy Pyramid example
Coca Cola’s official Mission is:
- “To Refresh the World“.
What is an euphemism for “being a daily Product for everybody”.
What Strategy does Coca Cola follow?
- Everyone loves to be Happy (it is axiomatic) so … Coca Cola wants to be identified as synonymous with Happiness.
If you want to be a “Daily Product”, you must be associated with something everybody loves.
What Tactics does Coca Cola use, to Comply with their Strategy?
- They develop Marketing Campaigns where the values of Family and Friendship are strongly highlighted.
You surely have seen these Campaigns:
- Christmas Ads.
- Billboards about Meeting again.
- Commercials about Love.
Coca Cola Strategy Pyramid.
Tesla - Strategy Pyramid example
Tesla’s official Mission statement is:
- “To accelerate the world’s transition to sustainable energy“.
Which is a euphemism for “We want a big piece of cake from the New Electric Car Market.”
What Strategy is allowing Tesla to Comply with its Ultimate Goal?
- Create a self-sustaining Electric Car Environment.
In this way, Tesla cars are not dependent on State infrastructure, which can take years to Complete.
What Tactics is Tesla following?
- Address the entire Electric car Market quickly, with a diverse offer.
And take advantage of the few Competitors that currently exist (or existed in the past).
Tesla Strategy Pyramid.
Ford - Strategy Pyramid example
Ford’s official Mission statement is:
- “To help build a better world, where every person is free to move and pursue their dreams“.
What can be summarized as “Offer Affordable Mobility solutions”.
What Strategy does Ford follow?
- To Focus exclusively on Affordable Automobile Alternatives.
All its efforts are concentrated in this particular segment.
What Tactics allow Ford to Comply with its Strategy?
- They Develop New Manufacturing Processes and Methods that allow Ford to develop High quality Cars at Affordable Prices.
Ford Strategy Pyramid.