Diamond-E Framework - Template & Examples

How can a business decide if its strategic plan is effective or not? One of the most powerful tools for strategic planning is the diamond-e framework. Donald Hambrick and James Fredrickson created the strategy diamond model in 2001 for organizations to see how different parts of their strategies fit together.

This article will cover everything you need to know about the diamond-e framework and its elements. Moreover, you will find the strategy diamond template at the end.

🔝 Top Diamond-E Framework Examples

1. Diamond-E Framework in Strategic Planning Process

🔶 What Is the Strategy Diamond?

There are many models for evaluating business strategies. The strategy diamond stands out because it focuses on specific elements of strategic planning, allowing a more profound examination.

By analyzing the strategy’s components, the model enables businesses to:

• Make their strategic plans more comprehensive and precise.
• Align various departments within one organization.
• Understand how to attract new stakeholders.
• Identify possible obstacles and improve risk management.
• Reveal the effectiveness of a strategy and competitive advantages.

The strategy diamond model includes the following elements: arenas, vehicles, differentiators, staging, and economic logic. Let us discuss each of them in more detail.

Arenas

In strategic planning, arenas represent where the firm will be active. This element considers geographical regions, market segments, customer demographics, and distribution channels. Besides geographic-market and product-market arenas, it is crucial to evaluate the value-chain arenas, such as manufacturing locations.

Vehicles

Vehicles is an umbrella term for all possible ways a company can achieve its goals. They include partnerships, franchising, licensing, joint ventures, and more. Here, the strategy diamond helps determine the vehicle to use and avoid. Identifying efficient external and internal assets fosters organizational focus and commitment.

Differentiators

This element determines organizational needs and capabilities. A deep internal analysis is conducted to identify the company’s pricing strategy, supply chain, and customer experience. Differentiators are also the basis of business vision and brand message.

Staging

Staging is another crucial element of strategic planning. It involves determining the sequence of actions the company should take and the speed at which it will execute them. Staging and pacing make a business consider its next steps instead of using a static and inflexible strategy.

Economic Logic

The final ingredient of strategic planning considers how a business makes money above its cost of capital. It includes environmental and social profits and funding from investors. Companies with strong economic logic earn enough to keep investors willing to continue to fund the organization.

📝 Diamond-E Framework — Template for Students

If you want to create the Diamond-E framework for any organization, here’s a template you can use. Consider these questions for each of the five elements of the model.

Arenas	What is the company’s niche? Who are the ideal customers? Is it a global brand, or does it aim at some geographical regions? What gives a company a competitive advantage?
Vehicles	Does a company take part in any joint ventures or partnerships? Should a business license or franchise its products? What internal developments does a company need for better competitive advantage?
Differentiators	What is the business’s pricing strategy? What are the company’s core message and vision? What makes the firm’s products or services unique?
Staging	What is the timeline of the company’s strategic plan? What is a business’ potential speed according to its capabilities? How can competitors affect a company’s speed of execution?
Economic logic	Does a business provide any premium offerings, such as unique features? How can a company demand a premium price in the market? How much of the company’s product is proprietary?