The Strategy Paradox

The Strategy Paradox (adapted from Michael Raynor)

Welcome to the Strategy Paradox. The Strategy Paradox is simply this -- strategies with the greatest possibility of success also have the greatest possibility of failure. The best and most well-managed companies in the world have much in common with the most abject failures in the business world. The same actions and uniqueness that are likely to make one company successful also may be the seeds of its total failure.

You can completely understand your customers, identify reasonable target markets, create (or buy) perfectly viable products, execute your strategy flawlessly, monitor your progress and results, and still fail miserably.

Why? – because strategy is about predicting the future, making assumptions about what is going to be, and making commitments based on those assumptions. If the future you predict is wrong, all of your right actions will still doom you to failure.

There are ways to ensure you don’t guess so wrong that you jeopardize your business:
1) Thoroughly understand your market and your business environment, and determine whether any potential “Market Disrupters” are on the horizon.
2) Create a strategy that has the effect of changing the market in your favor.
3) Create Strategic Flexibility in your business and marketing plans.

The above three ‘tips’ may seem very difficult to do, but they are, in fact, quite doable. Let’s look at Strategic Flexibility now, and the others in future articles.

To have a truly great strategy in your Internet-based or conventional business, having more than one arrow in your marketing quiver is an absolute must. In fact, I would advocate that you had better have a varied portfolio within your business, or you have put yourself at great risk of failure.

The point is to have Strategic Flexibility. You want to be in a position where, even if some of your assumptions are wrong (and they will be), your business is still viable.

One way to create flexibility is to think like a chess champion. You need to master the concept of “Down Board Thinking”. World class chess players do not simply think about their own moves, they look ‘down board’ and consider their opponents’ (competitions’) possible responses to their moves, and plan a number of alternative moves ahead. This kind if thinking is particularly relevant both in creating your strategy, and in managing and monitoring the implementation of your strategy.

Much like a modern ‘smart bomb’, your strategy, once launched, requires constant monitoring of its progress. Down board thinking will help you anticipate the world in which your strategy will exist, how market conditions might change, and to help shape that world in such a way that you greatly enhance your chances of success. Do this, and you will be light years ahead of your competition.

Another way is to have enough actions (tactics) going on at roughly the same time, so that even if some of them don’t turn out as well as you expected, and that will happen, you will still prosper because you have enough right actions happening.

Everyone has heard some tried and true principles of strategy like, “Expect the unexpected,” “Always have a plan B,” or, “Better to have more options than you think you need, because you might have thought wrong.” These common sense principles have their echoes in the most successful companies in the world.

Strategy, to match reality at all, has to be based on the expected and unexpected reactions of all the participants, plus the inevitable curves that Fate will throw at you.

I want to dwell on that last notion—strategy as an engineering problem—for a moment. We have a tendency to look at business strategy as questions of what we are, or are not doing, should and shouldn’t be doing. In other words, we often do see it as an engineering problem: apply some precisely-targeted tactic here, a little marketing there, and voila! you have victory.

We all know, the real world isn’t that simple. Most of our careers have not been any kind of a straight line. I know mine sure hasn’t!! Most of our lives have not followed any simple set of steps where we can easily predict what tomorrow will bring. The world changes, and today it is changing faster and faster. A well thought out strategy gives you flexibility, and flexibility is the only way you will survive and thrive in today’s hyper-changing world.

The real aim of Strategy then, is to have a set of actions in place consistent with your view of your desired future. Once you have those actions in place, with systems, processes, metrics, and exit plans (because all strategies end), you can also begin to manage strategic uncertainty, that is, you can begin to think of other ways to grow your business that take into account the certain failure of some parts of your overall strategy..

Article Source: http://www.new.citynewslive.com

Certified Professional Management Consultant Jim McCarthy currently works in Oceanside, CA with his wife, Career Consultant Barbara McCarthy. For information on a complete Strategic Planning System, please go to Business Planning

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