S.T.E.P. Framework

The S.T.E.P. framework—State, Tailor, Evaluate, Plan—provides a structured approach to AI prompting for strategic decision-making, business planning, and marketing strategies by clearly defining objectives, providing relevant context, requesting analysis, and generating actionable plans.

Introduction

The S.T.E.P. Framework—State, Tailor, Evaluate, Plan—is a structured approach to prompt engineering designed for obtaining strategic insights and actionable recommendations from AI systems. This framework is built on the principle that effective strategic decision-making requires clear objectives, relevant context, thoughtful analysis, and concrete action steps.

This framework produces outputs that are:

• Objective-Focused – Tied directly to your stated business goals
• Context-Enriched – Informed by specific business parameters and constraints
• Analytically Sound – Based on evaluation of data, trends, and options
• Action-Oriented – Focused on implementable next steps

• Strategic business planning and decision-making
• Marketing campaign optimization
• Competitive analysis and market positioning
• Resource allocation and prioritization
• Performance evaluation and improvement

S.T.E.P. Framework Structure

1. State

The State component establishes what you want to achieve, setting clear parameters for the AI's response. This should be specific, measurable, and outcome-focused to guide the remainder of the prompt.

• Increase our email newsletter subscription rate from 2% to 5% within the next quarter
• Identify the three most promising market segments for our new productivity software
• Reduce customer acquisition costs for our enterprise clients by 20% while maintaining lead quality

• Improve our business (too vague)
• Get more customers (lacks specificity)
• Create a marketing plan (undefined objective)

2. Tailor

The Tailor component provides the situational context and constraints that shape the analysis and recommendations. This includes relevant business parameters, resources, limitations, and background information needed for informed analysis.

• "We have a marketing budget of $25,000 per quarter, a team of two content creators, and compete primarily with Enterprise Solution X and Platform Y. Our pricing is 15% higher than the industry average, but our customer retention rate is 30% better."
• "Our product is a mobile banking app targeting millennials with features focused on automated savings and investment. We've seen 40% growth year-over-year but are experiencing increasing customer acquisition costs over the past two quarters."

• "We're a small business" (lacks specific parameters)
• "Our budget is limited" (unquantified constraint)
• Providing irrelevant historical information not connected to the objective

3. Evaluate

The Evaluate component directs the AI to analyze the provided information through specific analytical frameworks, trend identification, or comparative assessment. This step connects the objective and context to potential solutions through data-driven insights.

• "Analyze our conversion funnel data to identify the top three drop-off points and benchmark against industry standards for SaaS products"
• "Evaluate our current content strategy against the buyer's journey model, identifying gaps in addressing customer pain points at each stage"
• "Compare our current market positioning against competitors using a SWOT analysis framework, with emphasis on identifying untapped opportunities"

• "Tell me what you think" (lacks analytical direction)
• "Analyze everything" (too broad)
• "Is this good?" (subjective without evaluation criteria)

4. Plan

The Plan component specifies the format and nature of the recommendations or action steps you want the AI to provide. This ensures the output is immediately applicable to your business context and can be implemented with available resources.

• "Recommend three specific tactics to reduce cart abandonment rate, including implementation steps, required resources, and expected timeframes for results"
• "Develop a 90-day content calendar addressing the identified gaps, with specific content types, promotional channels, and success metrics for each item"
• "Create a prioritized list of product features to develop based on competitive analysis, with each item rated for potential impact, development effort, and alignment with our core value proposition"

• "Tell me what to do" (lacks specificity)
• "Give me a plan" (undefined format and content)
• "Suggest some ideas" (insufficient structure for actionable results)

Example Prompts Using the S.T.E.P. Framework

Example 1: Product Launch Strategy

S.T.E.P. Breakdown:

• State: Achieve 500 paid users for new project management software within 90 days
• Tailor: $30,000 budget, $29/month pricing, 14-day trial, AI differentiator, SMB target, specific competitors
• Evaluate: Analysis of market penetration strategies, CAC by channel, lead gen tactics, conversion benchmarks, market trends
• Plan: 90-day strategy with channels/budget, content plan, partnerships, KPIs, and contingencies

Example 2: E-commerce Optimization

S.T.E.P. Breakdown:

• State: Increase AOV by 15%+ while maintaining conversion rate
• Tailor: Premium furniture products, current AOV, traffic data, top products, demographic details
• Evaluate: Comparison to benchmarks, bundling opportunities, cross-selling potential, price sensitivity, mobile UX limitations
• Plan: Bundling strategy, page modifications, marketing tactics, A/B tests, and implementation timeline

Best Use Cases for the S.T.E.P. Framework

1. Marketing Strategy Development

• Campaign planning
• Channel optimization
• Content strategy
• Budget allocation
• Performance analysis

2. Business Model Innovation

• Revenue stream diversification
• Pricing strategy
• Market expansion
• Product portfolio optimization
• Competitive positioning

3. Product Development Planning

• Feature prioritization
• User experience enhancement
• Market fit analysis
• Development roadmap
• Competitive differentiation

4. Performance Optimization

• Process improvement
• Resource allocation
• Efficiency enhancement
• Cost reduction
• Quality improvement

Bonus Tips for Using S.T.E.P. Effectively

💡 Begin with measurable objectives: In the State section, include specific metrics and timeframes

🎯 Quantify constraints and resources: Use specific numbers in the Tailor section for budget, team size, and other resources

🔍 Request specific analytical frameworks: In the Evaluate section, name exact frameworks like SWOT, PESTEL, or Porter's Five Forces

📊 Ask for prioritization criteria: In the Plan section, request ranking methodologies for recommendations

⚙️ Include implementation guidance: Request specific timelines, resource allocations, and success metrics for recommended actions

Conclusion

The S.T.E.P. Framework provides a powerful approach to prompt engineering for strategic decision-making and business planning. By systematically defining clear objectives, providing relevant context, requesting specific analytical approaches, and seeking actionable recommendations, you create prompts that generate strategically sound, contextually appropriate, and immediately useful outputs.

The framework can be extended with additional components for more specialized needs:

• Scenarios: Adding hypothetical situations or contingencies to plan for
• Testing: Including validation or measurement approaches for recommendations
• Engagement: Defining how stakeholders should be involved in implementation
• Performance: Establishing how success will be measured and tracked