4The Business Category

Traditionally, organizations take a top-down approach to strategic business planning. Executives consider industries, markets, and supply-and-demand patterns in that order. However, the Big Picture Strategy uses 6Bs to reframe strategic planning. You start at the bottom and work your way up. This is an important and fundamental difference.

You begin by considering the brand. Next comes the business category: the space where brands compete for customers. Business category membership is an important part of your brand identity. Once executives realize the importance of managing their brands as strategic assets, they must also begin to pay attention to managing their business categories.

Categorization is the mental process by which humans group elements they consider to be similar, simultaneously separating them from other elements they consider dissimilar. From birth onward, humans categorize things to help us relate new objects or concepts to those that are already familiar. Rather than examining each new object or concept we encounter as entirely new, we simply scan it to see how it fits into a group of similar items.

Categorization is key to early childhood development. Without it, children would have to respond to each stimulus as if it were entirely new. Categorization in business is quite similar to categorization in early childhood. It is a learning process to conserve and make our mental resources more efficient. Throughout all industries, companies ...

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