Two surprising dead-end strategies companies fall victim to
Company growth is key to survival for any entrepreneur. Without it you risk credibility with your investors and most certainly your bank. That is not to mention the impact on morale and corporate culture. You better had a strategy that gets you there though. Strategy is however one of the most misunderstood or misinterpreted terms we use in business and there are two main reasons why this is such a big issue. Especially the most important driver of our economy – the small to midsize organization – is afflicted by it.
Reason number one is the most troublesome: Busyness (not business). Your short term growth and tremendous amount of work that you feel cannot or should not be delegated keeps you from even wondering about what your strategy should be. Needless to say, it may even be worse that you have not pondered your “why”, the reason why you are in business in the first place and hence have not developed a formal vision and mission for yourself. If this is you, please start to sit on that rock sooner than later because you may soon have more time again to ponder it because of a decline in your business.
Reason number two is the misconception that driving down costs and boosting efficiency are viable and sustainable strategies. Strategy is accentuating and expanding on what makes you different. This may entail you having to also worry about your costing, delivery, marketing and sales channels, but those are never to be mistaken for strategy. They are nothing but a sugar rush that lets your energy drop like a rock once the effect wears off. The antidote is similar to reason number one’s: Positively identify your core value proposition to your target market. For instance, are you absolutely certain that you are after a mass product market or a niche market with a different price/ cost mix? Folks who try being everything to everybody typically learn the hard way and unfortunately really quickly how short lived and expensive this strategy is.
Big companies are no stranger to this phenomenon. Think about the ill-fated low budget big airline subsidiaries like Ted from United, Song from Delta that were supposed to compete with Southwest. Chances are you cannot even remember them and any smaller brand or organization would likely not be around anymore either.
The two dead end strategies mentioned here are about working in your business. Key to long-term sustainability is making time to work on your business. So when are going to have your first strategy session that will get you into that mode? Come on and kick it up a notch!