short thoughts — You know when you ask a colleague what they’re...

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You know when you ask a colleague what they’re working on and they tell you how they’re “working on some strategies to tackle blah, blah” and you think “perhaps you mean tactics …” but then think perhaps you’re being pedantic?
[[MORE]]So, what’s your...

You know when you ask a colleague what they’re working on and they tell you how they’re “working on some strategies to tackle blah, blah” and you think “perhaps you mean tactics …” but then think perhaps you’re being pedantic?

So, what’s your strategy anyway?

Strategy is a unifying theme giving direction to actions. In today’s uncertain, fast-moving and complex business world it’s probably not a detailed plan or even a programme of instruction. 

It’s a way of matching a firm’s external world of customers, competitors, suppliers and society as a whole with the internal world – what the firm is actually any good at.

The question: “what business are we in?” used to be answered in terms of market. Of industry attractiveness. Who are our customers? Which of their needs are we striving to serve? Who’s the competition and how will we survive it?

Change is so rapid today it makes more sense to turn to our internal resources and the way they’re bundled up into capabilities rather than to look outside to secure long-term growth.

Olivetti defined itself as a typewriter company. Beautiful machines. Smooth key strokes. The Italian iconic stationery company saw the advent of the word processor as the natural progression.

Instead of identifying what it was good at doing and then diversifying by moving into word processing it tried to produce something it had no expertise in. It failed.

Canon had its first success making 35mm cameras. If it had defined itself as a 35mm camera maker it may have gone the way of Kodak which went bankrupt in 2012. 

Instead Cannon centres products around three technological capabilities:

  1. Precision mechanics
  2. Micro electronics
  3. Fine optics

This has allowed the Japanese giant to leave 35mm film firmly behind and move through fax to calculators to photo copiers to semiconductors.

The greater the rate of change in a firm’s external environment, the more likely it is that internal resources and capabilities rather than external market focus will provide a secure foundation for long-term strategy. 

These are short thoughts. For longer, more fully-formed thoughts covering business, public relations and change visit www.sabguthrie.info or sign up to email updates.

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