Strategy and Execution – The Rock and the Hard Place

The life of the business depends on your ability to formulate and execute good strategy. The ability to do  this demands you not only have good strategy and good execution but you must also defeat or counter the  strategy and execution abilities of your competitors. If this wasn’t enough you must do it in a continuously  shifting technology and market environment. In “The Strategy Paradox” Michael Raynor drove this point home  using Sony as an example. Both the Betamax and the Discman were backed by excellent strategy but during the  product development life cycle there were advances in technology, competition and changes in market demands  that Sony failed to adequately identify, assess and respond to.

The prevailing philosophy says that winning teams don’t change their strategy in the locker-room at half time  no matter what the score. The same philosophy has also driven corporate behavior since the concept of  strategic planning took hold. Strategy isn’t set lightly nor should it be changed lightly.  Trust in your  people and the process then proceed with the execution. Naturally, you can and should make changes to the  supporting cast as necessary. If your strategy depends heavily on relationship selling and your sells force is  comprised of order takers that doesn’t invalidate the strategy, get rid of the old sales force or teach them  to build relationships. Such adjustments aren’t what we’re talking about though. What we’re talking about is a major change in strategic direction as a result of major changes in the marketplace.

Strategic flexibility begins by assigning responsibility for monitoring those industries and/or competitors having the capability to force a market change. With this knowledge you can develop risk mitigation strategies, prioritize possibilities, and plan a strategic response. The strategic flexibility framework (as provided in “The Strategy Paradox”) consists of four steps that enhance a company’s ability to increase control under uncertainty; achieve the results it desires at a level of risk it can tolerate.

The four steps are:

1. Anticipate:  Build scenarios of the future.
2. Formulate: Create optimal strategies for each of those futures.
3. Accumulate: Determine what strategic options are required.
4. Operate: Manage portfolios of options.

This framework will not deliver “right” answers; it is intended to organize the results of your analysis so that you can ask the right questions and consider the appropriate choices.

Randomness, probability and “The Black Swan” (Nassim Taleb) are always going to be a force of unknown magnitude.

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