Wayne Gretzky, the hockey great, famously said: "skate to where the puck is going to be, not where it has been." Wise advise for business strategists and amateur hockey players alike.
Having aided and studied the planning processes at over five dozen of the FORTUNE 500, most of the companies we've seen do one of two things. Poor performers consistently react to the market, as loss of market share and weakened competitive position force them to change their day-to-day actions. They're caught in a perpetual cycle of playing catch-up. Average performers plan around where the market is today, actively thinking about how to meet existing market needs. Good, right? No! Strategy takes time to implement and have impact and, in both cases, these companies are simply skating to where the puck has been. One could argue that, in the first instance, the companies in question actually only have a jumble of tactics and lack a coherent strategy altogether.
In contrast, the best-in-class (only a small group of companies) conduct deep, forward-looking analysis of market dynamics (customer needs, competitor strategies, channel shifts, etc.) as a means to forecast where the market is headed over the mid- to long-term. They then set their multi-year strategies in order to catch the market at that identified future-state. Those are the companies that emerge as market leaders within an industry; they are seen as setting the tone and direction of a sector and are the ones that gain share and power. They are also the ones that the poor and good performers we mentioned above are constantly trying to catch up to - a vicious and perpetual cycle.
The best-in-class companies conduct a deep, forward-looking analysis of market dynamics as a means to forecast where the market is headed over the mid- to long-term.
If you are in charge of setting strategic direction at your company or within your division, you need to ask yourself five questions:
1. Are you building a defensible long-term position and gaining share, revenue and profitability in the process?
2. Do you understand your markets well enough to do so?
3. If so, do you have a strategic planning process capable of turning those insights into a strategy that allows you to emerge as a market leader?
4. If not, are you doing the things needed to close the insights, planning, people and process gaps necessary to go from laggard to leader?
5. And, are your people equipped (skills, attitude, culture) to act on your strategy or do individuals need to be moved around (or out)?
If the answer to any of the above questions is "no," then we would argue that significant opportunities exist for your organization to gain share and position within your markets.
Contact us to learn more.