Rethinking strategy: A practical approach for SMEs

This article is written by Stephanie Dawson, Lecturer in Strategy and Management, Strategy Advisor and Business Mentor at Leeds Beckett University.

In a fast moving and volatile economy, small and medium-sized enterprises (SMEs) face both extraordinary opportunities and formidable challenges. Navigating this complexity successfully demands more than hard work or a great offering - it requires a clear vision and strategic insight.

For SMEs, strategy is not a luxury – it is a necessity for sustainable, impactful and future-proof growth.

SMEs are the backbone of the UK economy, accounting for over 99% of all businesses and employing over 16 million people. In today’s fast-moving environment, they face an increasingly complex landscape.

To remain competitive, SMEs need to elevate themselves from their day-to-day operations and take a step back. The key is to develop a clear, focused strategy – one that helps them stand out, adapt, and grow.

This is where the 90% government-funded Help to Grow: Management Course plays a pivotal role. Developed and delivered by Small Business Charter accredited business schools, it encourages business leaders to take a “helicopter view” of their enterprise and start developing a robust growth plan based on insights rather than assumptions.

One of the most effective tools SMEs can use at this stage is the Business Model Canvas – a simple yet powerful framework that helps leaders map out how their business creates, delivers and captures value.

By visually laying out each component, SMEs can clearly assess what drives their business and where strategic improvements or innovations may be needed.

It is a practical way to step back, see the whole picture, and make informed decisions."

Considering the uniqueness of their resources and capabilities, helps SME leaders focus on what truly sets their organisation apart and what matters strategically.  Unlike large corporations, SMEs often have the agility to innovate quickly. Leveraging their unique strengths allows them to pivot effectively and build long-term resilience.

To build strategic insight, understanding the dynamics of the competitive environment is equally important. Analysing external pressures, from the threat of new entrants to the bargaining power of suppliers and customers, equips business leaders with the foresight needed to navigate uncertainty and seize opportunities in their market.

Growth does not have to mean scaling fast. Using the simple yet powerful Ansoff Matrix, SMEs can explore different growth strategies. This framework encourages thoughtful decision-making, balancing risk and opportunity to align with a business’s capabilities and aspirations.

Developing an innovative mindset helps SME leaders adapt to their fast-changing environment.

In today’s competitive landscape, innovation in how value is delivered is essential. Whether it relates to digital transformation, eco-friendly packaging, or business models, innovation should be guided by a carefully considered value proposition, aligned with customer needs and supported by a clear strategy. As such, it becomes not just a means of differentiation, but also a driver of positive impact.

Strategic thinking is often associated with large corporations and can sometimes feel too academic or abstract for SMEs. However, effective strategy is about making informed, conscious choices:

-          What makes your business work?

-          Who are your customers and what do they need?

-          How do you create and deliver value?

-          Where should you invest and grow?

-          How can you innovate without losing focus?

Frameworks such as the examples above allow business owners and managers to structure their thinking and answer such questions. They help cut through complexity so that those at the helm can lead with confidence.

The most successful SMEs are not necessarily the biggest or the fastest growing. They are the organisations with leaders that truly understand their business and context, know their customers, and focus their efforts where they matter most. In a fast-changing environment, shaped by economic uncertainty, political volatility and evolving consumer behaviour, leading with clarity is a competitive advantage.

Help to Grow: Management equips SME leaders with simple, actionable tools to gain fresh insight, define their strategy, and grow with clarity and purpose.