– Thoughts on Strategy and Management

Ideas for overcoming analysis barriers

Strategic planning is linked with a variety of problems and barriers. Some of them are related to sequence and tools of the planning process. Other problems and barriers exist since strategic planning takes place in the context of the firm’s culture; in some circumstances this culture can break the planning process. Therefore I would like to set up an informal series of posts that presents some ideas how to overcome or to minimize some barriers. I would like to start with an essential part of each strategic planning process, the strategic analysis.

Typical problems exist within the analysis of environment, corporate analysis as well as within value analysis and acceptance related problems.

To develop a successful and sustainable strategy, your organization should apply an approach that considers the impact of secondary effects. In most cases I recommend taking a dynamic view of the marketplace. The size and scope of your view should consider the dynamics and the number of players in your business segment. Using this approach, your organization should anticipate competitive reactions and explicitly incorporate them into your strategic analysis. To ensure such a dynamic view I can recommend applying an approach that is based on the analytical technique of business dynamics.

I think that this approach is essential, since your organizations’ strategy analysis should focus on products, markets and channels of both today and tomorrow. The latter one is probably the most difficult part: you have to explore unstated priorities that your customers sense but cannot fully articulate. How do you do this? A way is to raise fundamental questions about the structure of the market and queries not just your existing customers. The key is to identify your future-defining customers who might be found in different, sometimes in obscure places.

To reduce the problems related to external analysis I also recommended structuring the environment into different segments and sub-segments. Segments could be general environment, business market and industry; where technology and economy could be sub-segments of the general environment. The creation of different scenarios can be seen as a way to manage the uncertainty of forecasts.

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