11 Best Strategic Frameworks For Your Organization

Strategic frameworks give you the structure to think and work within. However, the sheer volume of available frameworks, ranging from straightforward to intricate, can leave even the experts puzzled. But that’s not all. 

As Annie Lucchitti, Marketing Manager Home Care (Unilever), points out in this strategy report: 

"Working in a framework of setting a strategy & spending 12 months executing one PowerPoint or piece of paper no longer exists." 

We need to be more flexible if we want our strategies to impact business outcomes in unpredictable business environments. 

In this article, we’ll cover 11 strategy frameworks and show you how to implement the right one(s).

What Is A Strategic Framework?

A strategic framework is a tool that assists you at a specific stage of the strategic management cycle, most commonly during the strategy formulation and evaluation stage. 

These frameworks offer insights into a business environment, helping to identify strengths, weaknesses, and the best course of action. 

By selecting or blending the most suitable strategic frameworks, organizations can sharpen their focus, navigate real-world complexities, and chart a path to sustainable success.

How To Use The Right Strategic Framework 

Here are three best practices and tips to help you pick and use the right strategy framework for your company:

Tip #1: Pinpoint the business problem 

Understand what is going on within your organization today by examining core business metrics and talking with key team members.

For example, let’s say your corporation sells electronics, from smartphones to washing machines. If you notice a drop in smartphone sales, analyze the data from the last few months. Are there particular models not selling well? Are there regions or countries where sales are slow?

By first identifying the primary challenges you face, you'll keep your strategy evaluation on track. This clarity will guide you in selecting the best strategy, allowing you to dig into the fundamental business issues and create a strategic roadmap that positively impacts your key business metrics.

💡This step is crucial because it will also help you define your desired future state and align on the key metrics the whole company will need to work on to get there. 

📚Recommended reading: What is Strategic Analysis? 8 Best Strategic Analysis Tools + Examples

Tip #2: Use the right strategic framework to dig deeper 

After pinpointing the issue (the "WHAT"), your next step is to understand the underlying reasons (the "WHY"). Use strategic frameworks to reveal the root causes, associated risks, and viable strategic options to improve your current situation. 

Which framework to choose? We’ll cover this later in this article. Regardless of your choice, the insights and data you gather will inform your decision-making and strategy development.

💡Remember, you don’t have to pick just one framework. Many organizations use two or more frameworks to better suit their unique strategic needs.

Tip #3: Review your plan against your chosen strategic framework

Strategic frameworks offer a great starting point for building a business plan, but they won’t ensure flawless alignment and execution. You should have in place systems and tools that track how ground-level operations contribute to your broader strategic plan. 

Strategy execution tools like Cascade help analyze the alignment of your strategic plan with its framework. It consolidates data, giving you a comprehensive view of your business's performance across all levels. This lets you make timely, informed decisions and offers real-time insights into your organization’s progress toward its objectives.

Now let’s take a closer look at 11 strategy frameworks that we’ve compiled in this article.

1. McKinsey’s Strategic Horizons

McKinsey's Three Strategic Horizons keep you focused on growth and innovation. This strategy framework requires you to categorize your goals into 3 different focus areas:

• Horizon 1: Maintain and defend the core business 
• Horizon 2: Nurture emerging business 
• Horizon 3: Create genuinely new business

💡When to use this framework: 

McKinsey's Strategic Horizons is a great strategic framework that keeps you focused on constantly growing your organization and creating future revenue streams. While many organizations prioritize short-term profits, doing so can expose them to market, customer, or competitive risks.

👉Want to give it a try? Grab your free McKinsey's 3 Horizons Strategy Template with pre-filled examples and 100% customizable to fit your specific needs. 

🤝What kind of organizations might use McKinsey's Strategic Horizons: 

Most organizations can benefit from this framework, especially fast-growing entities like startups balancing cash flow and growth.

📚Recommended read:Three Horizons Framework To Help You Grow (With Template)

2. Value Disciplines

Using the Value Disciplines, organizations can bolster their competitive advantage by building on their strengths. Choose one core value discipline and align your strategy to it:

• Operational excellence: Focused on delivering high-quality products/services at competitive prices. This discipline aims to create a competitive advantage through streamlined processes, reduced errors, and maximized efficiency. Examples: Dell, Wal-Mart, IKEA, EasyJet and RyanAir.
• Customer intimacy: By prioritizing customer relationships, organizations can create a sustainable competitive advantage by understanding and meeting their unique needs. This approach values long-term bonds over one-time transactions and employs robust CRM strategies. Examples: Home Depot, Staples, Kraft, Ciba-Geigy, and Frito-Lay. 
• Product leadership: Organizations can achieve a competitive advantage through continuous product innovation to stand out as market leaders. Significant investment in R&D and fostering employee creativity are essential. Updated products often have superior features and improvements. Examples: Apple, Bang & Olufsen, and Philips. 

💡When to use this framework: 

The Value Disciplines framework emphasizes choosing one core business model to excel in, concentrating resources, and avoiding distractions.

🤝What kind of organizations might use Value Disciplines:

While versatile for various industries, it's best for businesses that need differentiation. If you're already aligned with a discipline (e.g., consulting firms with customer intimacy), the framework may offer limited added value. However, in industries where products are sold in multiple ways (like airlines), this approach can enhance differentiation.

📚Recommended read:Value Discipline Model & Your Competitive Advantage

3. The Stakeholder Theory

Though not a well-known model in the broader business world, the Stakeholder Theory focuses on adding value to specific groups:

• ​​Employees: Prioritizes their well-being through financial benefits like salary hikes, and intangible perks such as training and facilities.
• Customers: Targets improvements in products and accessibility.
• Community: Ranges from benefits like job creation to more significant community enhancement initiatives.
• Shareholders: While often used by non-profits, for-profit organizations also use this to enhance their bottom line.
• Society: Beyond the local community, this focuses on broader societal benefits, such as technology advancements or environmental efforts.

Add more groups to the list, if it makes sense for you—there is no set rule.

💡When to use this framework: 

Use this framework if you're aiming for a holistic approach that considers the interests of all groups impacted by your organization, not just shareholders. It will help you identify and address potential risks arising from neglecting any key stakeholder group, thereby ensuring sustainability and long-term success.

👉Want to give it a try? Grab your free Stakeholder Theory Strategy Template with pre-filled examples and 100% customizable to fit your specific needs. 

🤝What kind of organizations might use the Stakeholder Model:

Non-profits and academic institutions often benefit from the stakeholder model. Their grants and funding are usually linked to showing tangible benefits to stakeholders. Using this model, organizations frequently share their results online, showcasing their positive impact on stakeholders. 

📚Recommended read:What is Stakeholder Theory? The Benefits of Applying it

4. The Balanced Scorecard

The Balanced Scorecard is built on the premise that your business strategy should be equally divided into 4 quadrants to ensure successful strategy execution: 

• Financial: Addresses goals for the bottom line and other crucial financial KPIs like liquidity or margin.
• Customer: Focuses on understanding and enhancing customer satisfaction and meeting their needs with your product or service.
• Internal business process: Concentrates on measuring and optimizing processes vital to customer satisfaction.
• Learning and growth: Also known as the people quadrant, it underscores employee education, knowledge management, and leveraging these for a competitive edge.

To succeed with the Balanced Scorecard framework, simply setting goals in the quadrants won't be enough. Organizations should establish clear numerical KPIs for each quadrant and consistently monitor and evaluate them. It's not just about balancing goals; it's about balancing outcomes.

💡When to use this framework: 

Use the Balanced Scorecard to understand your organization's performance beyond financial metrics. This framework facilitates regular performance evaluation against set targets, drives continuous improvement, and ensures that the needs and expectations of various stakeholders, such as customers and employees, are met.

From our internal research with customers using Cascade, we see a strong correlation between the success of a strategic plan and how evenly balanced it is across the 4 quadrants.

👉Want to give it a try? Grab your free Balanced Scorecard Template with pre-filled examples and 100% customizable to fit your specific needs. 

🤝What kind of organizations might use the Balanced Scorecard: 

The Balanced Scorecard is widely recognized as an effective strategy framework, especially for medium-sized and larger organizations. 

📚Recommended read:How To Implement The Balanced Scorecard Framework (With Examples)

5. The Ansoff Matrix

The Ansoff Matrix targets organizations aiming for robust sales growth. While it might not cover every aspect of business strategy, its focus on growth makes it a powerful tool. The matrix is divided into four categories:

1. Market development: Expanding your existing product to new audiences, like entering new geographies or using online sales channels.
2. Market penetration: Boosting sales of current products to existing customers by intensifying marketing efforts or offering purchase incentives.
3. Product development: Introducing new products to existing customers, like sports shoe companies venturing into sportswear.
4. Diversification: Launching new products in new markets is the riskiest strategy due to unfamiliarity with both product and market.

💡When to use this framework: 

People often see “growth” as a single part of their strategic roadmap. The Ansoff Matrix, however, forces you to think more deeply about exactly how you're going to achieve that growth. Your risk appetite will largely dictate which components of the matrix you will attack. 

👉Want to give it a try? Grab your free Ansoff Matrix Template with pre-filled examples and 100% customizable to fit your specific needs. 

🤝What kind of organizations might use The Ansoff Matrix:

The Ansoff Matrix is ideal for organizations focusing on growth. While startups might find it challenging in their early phases due to resource constraints, SMEs and larger enterprises, especially those nearing market saturation, can benefit from its structure to plan their next growth move.

📚Recommended read: The Ansoff Matrix: 4 Growth Strategies Explained (With Examples)

6. Porter’s Five Forces

Porter's Five Forces model (by Michael Porter) is a strategic framework that helps you identify and analyze five forces that affect a company’s profitability in any given industry:

1. Threat of new entrants
2. Bargaining power of suppliers
3. Bargaining power of buyers (customers)
4. Threat of substitutes
5. Competitive rivalry

💡When to use this framework:

Companies use this framework to assess an industry's competitive landscape and inform their decision-making. It's particularly useful:

• Before entering a new market to gauge its profitability potential.
• In strategic planning process to identify threats or opportunities.
• When facing challenges in an existing industry to adapt strategies.

👉Want to give it a try? Grab your free Porter’s Five Forces Template with pre-filled examples and 100% customizable to fit your specific needs. 

🤝What kind of organizations might use Porter's Five Forces: 

Organizations of all sizes, from start-ups to large corporations, benefit from using Porter's Five Forces to evaluate market competitiveness and potential barriers. 

📚Recommended read: Porter's Five Forces (2023): The Definitive Overview (+ Examples)

7. SWOT Analysis

SWOT analysis is a diagnostic tool that allows organizations to evaluate their internal and external environment. It’s instrumental when setting the strategic direction or framing future initiatives. It looks at 4 things:

• Strengths: What your business does well.
• Weaknesses: Where it might be lacking.
• Opportunities: Chances out there for growth.
• Threats: Things that can cause problems.

💡When to use this framework:

Use SWOT analysis as a way to get a clear picture of your business's current situation. It's great for when you're planning to launch a new product, entering a new market, or just trying to improve your business overall. 

👉Want to give it a try? Download your free SWOT Analysis Template.  

🤝What kind of organizations might use SWOT analysis: 

Almost any organization can benefit from a SWOT analysis. From small local businesses and startups to multinational corporations and non-profits, it's a versatile tool. 

📚Recommended read: SWOT Analysis Template: How to do vital strategy groundwork

8. Growth Share Matrix

This business framework was created by Boston Consulting Group (BCG) to assist corporations in planning their product portfolios. It classifies business units or products into four categories based on their respective market growth rates and shares:

• Stars: The primary strategy for Stars is to invest in them to maintain or increase market share until the market growth rate slows.  
• Cash Cows: Companies usually prioritize harvesting profits from Cash Cows and invest them in other areas of the business. 
• Dogs: Businesses typically consider divesting, discontinuing, or restructuring Dog units to free up resources for more promising areas of the business. 
• Question Marks: Management needs to evaluate Question Marks carefully and decide whether to invest in them to pursue market leadership or to divest. 

💡When to use this framework:

Organizations should use the Growth Share Matrix when they need to allocate resources among multiple products or business units. It's ideal for prioritizing investments and making decisions based on market growth and share.

🤝What kind of organizations might use the Growth Share Matrix: 

The Growth Share Matrix is useful for companies with diverse product portfolios, particularly those that operate in competitive markets. This includes large corporations, conglomerates, and companies with multiple products. 

📚Recommended read: 26 Best Strategy Tools For Your Organization in 2023

9. Blue Ocean Strategy

Blue Ocean Strategy is about finding new and unexplored markets where there's less competition. Instead of trying to outdo competitors in a crowded market, companies look for fresh spaces where they can be the leader.

💡When to use this framework: 

Companies use this strategic framework when the current supply in their existing market exceeds demand or if turnover has increased and profit margins are diminishing. 

👉Want to give it a try? Grab your free Blue Ocean Strategy Template with pre-filled examples and 100% customizable to fit your specific needs. 

🤝What kind of organizations might use the Blue Ocean Strategy:  

Blue Ocean Strategy helps organizations, whether startups, established firms, or non-profits, find untapped market spaces to avoid intense competition. It's versatile but should be tailored to each organization's unique needs for best results. 

📚Recommended read: Blue Ocean vs. Red Ocean Strategy (Overview with Examples)

10. Value Chain Analysis

Value Chain Analysis examines all the steps a business takes to deliver a product or service to its customers. It shows how the activities in a company’s value chain are linked to each other and influence competitive advantage.

💡When to use this framework: 

Use value chain analysis to identify areas for cost savings and opportunities to add value. According to the value chain framework, companies can increase their competitive advantage by differentiating products or services or lowering costs. 

🤝What kind of organizations might use the Value Chain Analysis:  

Organizations, regardless of size, that are looking to optimize their operations and enhance the value they deliver to customers can benefit from Value Chain Analysis. This includes manufacturers, service providers, and businesses in competitive industries seeking a competitive edge or cost efficiencies. 

📚Recommended read: Value Chain Analysis: Overview, How To Use It (With Examples)

11. PEST Analysis 

PEST analysis evaluates the Political, Economic, Social, and Technological factors affecting a business or industry. 

The difference between PEST and PESTLE is that PESTLE includes two additional factors: Legal and Environmental, providing a more comprehensive overview of the external factors impacting a business.

💡When to use this framework: 

Use a PEST (or PESTLE) analysis when you want to understand and evaluate the external macro-environmental factors that could impact your business or industry. It's especially helpful during strategic planning, entering a new market, or launching a new product, as it highlights potential challenges and opportunities in the broader environment.

🤝What kind of organizations might use the PEST Analysis:  

PEST analysis helps businesses operating in rapidly changing environments or those subject to significant political, economic, social, or technological shifts. By understanding these external factors, companies can better position themselves for success and mitigate potential risks.

📚Recommended read: How To Do A Pestle Analysis In 6 Steps

Which Is The Best Strategic Management Framework For Your Organization?

There is no right or wrong when choosing a strategic framework. Only what fits your organization’s strategy and desired business outcomes. Consider these examples: 

• If your business strategy is focused on growth and innovation, you might find that McKinsey's Strategic Horizons is the best strategy framework for you. To ensure you consider all internal and external factors that could affect your strategy, you can combine it with a SWOT analysis.
• If your business strategy is all about balance and sustainable competitive advantage, the Balanced Scorecard might be more fitting.
• If your business strategy is focused on a particular aspect or niche, explore Value Disciplines. 
• If your business strategy focuses on a societal level and people, try the Stakeholder Model.

Here, we've only scratched the surface of what's available in terms of the best strategy frameworks.

Working closely with our customers, we find that organizations often overcomplicate their strategies and frameworks in an attempt to reflect the complex markets they operate in.

However, by using Cascade, you can adopt and customize frameworks like the Balanced Scorecard to your organization's needs.

Once you've conducted a strategic analysis using your chosen frameworks, Cascade is there to help you execute your strategy, ensuring alignment with your overall organizational goals.

Want to take Cascade for a spin? Sign up today for free or book a guided 1:1 tour with one of our Cascade in-house strategy execution experts.