“Strategy” is a term that is highly regarded in the marketplace, sometimes even misplaced. The Collins English Dictionary expresses strategy as the art of planning the best way to gain an advantage or achieve success, especially in war. And, the war of business is competition, the marketplace is a very competitive field and the one with the best plan tends to survive and thrive better. Of importance to note is that there will never be one best strategy for all, what may work for one business may fail dismally for another, even businesses in the same industry and serving the same markets.
Several companies are getting into the period of developing strategies for the coming year and there are so many questions being asked. For some, it is a very challenging period as they are not sure what to do. The exchange rates are changing at a faster rate and are working against business common sense. In general, the business environment is being perceived to be not conducive for ‘reasonable’ planning. As a result, it is common for many to abandon their usual strategy sessions, as they consider them to be of less value since there is difficult in predicting the future! However, is that the best approach to strategy for the coming year? What is the business going to do to ensure that its strategies are not overtaken by events?
To have strategies of excellence, especially when there is unpredictability, the approach to strategy development has to change. It is not time to dwell on the failures or success of the past years. The past is gone, and the business has to prepare for the future. No successful business ever operated with ‘one’ strategy to remain the leader in the market, whether in good times or in bad times. Strategy is considered a failure if it fails to deliver the intended advantage, and mostly it’s because there are no back up strategies to the ‘strategy’. Just like the weather seasons change, so does the business environment and with such change the strategy must change.
The weather seasons wait for no man, they change – so does the business environment. If a man fails to plant in due season, he will have no harvest when harvest time comes. The business environment might be volatile, but it will change – what strategies do you have for the new environment? At any given point, a business must have a minimum of four strategies – that’s how dynamic businesses operate, for nothing remains unchanged forever! Businesses operating with at least four strategies are always prepared for any environment – obviously not to say that they are not affected by the conditions, but they will be prepared and a right strategy is implemented.
A business needs a defense strategy, coordinating resources strategy, attacking strategy and a consolidating strategy. The cycle of the four strategies never stops, that’s how businesses win in almost all conditions. Every business has weaknesses or vulnerabilities, and such vulnerabilities must be protected at any given time. With a SWOT analysis, the business leader gets to know the vulnerabilities of the business and should always have a strategy to protect such vulnerabilities. The business’s vulnerabilities can be from any direction be it external or internal – the external perception of the business, the reputation in the marketplace and the brand. On the internal side, the vulnerabilities might be the lack of financial resources, the employees, lack of management ability or the processes.
These vulnerabilities differ with the organisation, and when you are aware of your current vulnerabilities, it is easier to develop a strategy to ensure that the business is not ambushed from its weakest points. During a disaster or turbulent times, the defense strategies will be there to protect against vulnerabilities and minimizing losses. For example, in the current business environment, it is time to apply the defense strategy to defend the value that the business might have built over the years, and as well as minimizing losses caused by the turbulence.
An area of inadequate protection of vulnerabilities by many organisations is that of planning for a southward performance. Without a strategy for such times, the responses are either too slow, too shallow or poorly thought out. In times of southward performance, several business leaders panic and make irrational decisions that even cost the business in the long-run. When the business leader is not prepared, chances are that they become another obstacle to the business when a recession happens. A rushed out plan or strategy can be a very fatal plan. Whereas, a well-thought through plan, shelved and then taken off the shelf in time of need can mean rapid success when all competitors are panicking and flapping about what they should do.
Developing a defensive strategy, especially for times of recession, is never easy and it is not only a matter of asking what would be done when sales dry up or dwindle. It takes a number of factors into consideration, including checking the effects of a previous recession on your industry, adding opinions as to the likely impact of a future recession – considering that the effects might be different from the past recession, setting conditions when the plan gets implemented and considering the cost of implementing the plan. When satisfied with the preparation, the plan can then sit on the shelf waiting for the right time for implementation – but obviously hoping that it never get to the point of implementation!
A plan should not be crafted when the conditions have changed, it must always be there ready for implementation. For example, a good farmer does not prepare for summer in summer, but prepares for summer in winter! There is an amazing scripture that admires how the ant is well prepared – it gathers its food in summer for winter, meaning it gets prepared for winter in summer. The booming economy may emerge soon, will your business be prepared? This is the time to craft strategies for a booming economy, when the boom does not come soon, you continue to implement the ‘defensive’ strategies of protecting what you built in the past years – but your strategies will be in the shelf ready for implementation when things turn around.
Another key strategy for every business is that of coordinating resources – maybe for growth or expansion. There will come a time when the business need to expand, and that is the time when you have to implement the coordinating resources strategy. It may not be possible for your organisation to expand organically, and there is need for other partners. In your coordinating resources strategy, the business must identify its potential partners and even create relationships waiting for the right time to pull the resources. When the business has been making good profits in the past, it may coordinate resources from its own coffers and go for expansion. Nevertheless, the strategy must be very clear on how it will be done. Trying to coordinate resources when the emergency button has been pressed is detrimental to the success of a business. Many blunders maybe made, even signing contracts that will sink the business in the future.
Coordination of resources may also mean coordinating teams, multiple business coordination, national government coordination (depending on the nature of project or expansion being sought), coordination of departments or alliance coordination. Therefore, the strategy for resource coordination must always be in place – to avoid exposing the business in the times for expansion and growth. When resources are not properly coordinated and there is no strategy, there is likely to be a disconnection of business aims and objectives – and it normally leads to failure.
An attack strategy has to be crafted too and must always be in the business. The attack might be going after market share, going after new markets, expanding the existing market or setting up a new product line. Whatever the attack will be – and this depends with an organisation. One organisation’s attack might be different with another – all this is driven by the organisation’s vision and objectives. Nevertheless, the business does not have to start scrapping on how to attack when it needs to attack, the attack must have been prepared some time back. When the time comes, it has to be only a matter of pulling out the strategy and implement.
The attack strategy may yield the intended results, therefore there must be a consolidating strategy of the gains or rewards of the attack. Sometimes, the attack is for a season and when the season is over the business has to consolidate the benefits and engage a strategy to protect the gains. The cycle of these strategies does not stop, and only be revisited when it’s “strategy” time. Strategy is continuous, and some strategies are for the shelf waiting for the opportune time.
Therefore, regardless of economic or business conditions, a business must have a suitable strategy for each season. Strategies are prepared before the time arrives, that’s how you can have better advantages of success compared to competitors. According to goalcast, “Plan for what is difficult while it is easy, do what is great while it is small.” In short, have a strategy for winter while it’s summer!
Batanai Kamunyaru is a business coach and writer. He is a world class organisations facilitator, and he can be reached at firstname.lastname@example.org and Twitter: @bkamunyaru1 or at +263 718 852 489.