Simply Management: Effective Methods to Plan, Manage, and Improve Businesses. Warwick J Thompson

Чтение книги онлайн.

СКАЧАТЬ before we catch the plane or take the car. Most times, we have a vision of what we would like to become in life before we begin the training or study required to achieve that objective.

      But generally, all those aspects of our private lives where we get it right, don’t involve any competition, (unless it’s for a place in the class or secure a new job). The ‘strategy’ part has no competitive element to it.

      Business strategy is competitive. It is a competition with others in ideas and methods, or a competition of positivity with negativity, or progress and change with the status quo. It can mean conflict. So it is difficult and our human nature prefers to avoid the difficult and thus we would rather organize and feel more comfortable we are doing something constructive, instead.

      What follows in this little book therefore follows another of my Management Maxims: First devise the strategy – then organize to implement it.

      STRATEGY

      What is a strategy? There are as many definitions as there are authors.

      I define strategy as the creation of competitive advantage and the strategic process is knowing how you will create competitive advantage and how to achieve it.

      Just knowing what it is you want to achieve and how to get there, is not a strategy, it’s an objective. It lacks having a competitive advantage.

      Competitive advantage creates the opportunity for profit and business security. The strategy of any business is to find ways of building competitive advantage over other participants. The stronger the competitive advantages and the more sustainable they are, the better the opportunity for higher profits and for longer-term survival of the business.

      Strategies should not be confused with success factors.

      1. SUCCESS FACTORS

      Success factors are those fundamental aspects and actions of the business which must be present and be done well, just to qualify for entry into the family of competitors. Those fundamentals must be present in a business just for it to be a participant in that particular business sector.

      When all the participants attend to those same basic fundamentals in the same way, no one participant enjoys any competitive advantage over any other. They just display the primary factors necessary for success in their industry or sector. They are therefore not strategies, but often get mistaken for being so.

      Yet it is surprising how often a business is set up that doesn’t even address the fundamental success factors required just to be a participant in its industry, let alone to create any competitive advantage.

      As an example, I recently viewed a failing tourism business. The owners had purchased a large old home in a remote rural area (because it was available). They totally refurbished, redecorated and lavishly furnished the many rooms, adding numerous ensuites in the process. They remodelled the old tennis court, built a swimming pool and recreated a beautiful garden. All their remaining funds were spent on an attractive website, stylish brochures and extensive print advertising to attract wealthy tourists to their ‘exclusive’ lodge. Nobody came.

      Though they had attended to a number of the success factors required for their participation in their industry segment, they had ignored many that were vital for participation in their chosen market. For example...

      The venue had no unique character. The recreation opportunities were ho-hum. The location and surrounding area had no significant scenic value. It was not in a recognised tourist region nor anywhere near a normal route for air or road transport; it was in a backwater general farming district. The nearest large town was a low-decile city, off the tourist trajectory and with limited industry and commerce, so that even a subsequent effort to attract business or conference groups also failed.

      When they conceptualised the venture, the owners should have listed all the success factors required just to participate in the exclusive-destination tourism segment. Doing that would surely have identified those fundamental success factors they overlooked, well before they went looking for a location, let alone securing an appropriate venue.

      Only if all the success factors were first achieved could they then have begun to devise a strategy for building competitive advantage in their chosen market. It would have provided better security for their huge investment and saved a lot of anguish and heartache had they done so.

      For a moment, imagine that you would like to be in the fast-food market.

      The success factors required just to be able to compete for consumers in that market, should address the following:

      •Location - in an area of high population density and people-traffic flow.

      •Accessibility - must be easy to get to, to enter, to park.

      •Visibility - must be easily seen and quickly identified amongst its surroundings.

      •Hygiene - premises must be clean, uncluttered and bright.

      •Simplicity - ordering must be easy & quick, packaging & handling simple.

      •Consistency – repeat orders must replicate the original exactly

      •Staffing - all staff must be clean, tidy, courteous & eloquent.

      These are fundamental success factors and a participant who does not satisfy them all will not even be able to begin competing for customers. Any fast-food business must meet these requirements and all those that participate will do so – they are like rules for entry.

      So before you start a new business, or buy an existing one, make a comprehensive list of all the success factors that must be present for the business to participate in its respective market. Then make sure they are all present or will be achieved.

      But just meeting them does not make one business any more competitive than any other business that also meets them. Achieving the success factors does not of itself create any competitive advantage. For that, the business needs a strategy.

      2. SOURCES OF COMPETITIVE ADVANTAGE

      For quick reference, I consider there are four primary source-groups from which competitive advantage can be built, thus creating the strategy.

      Not all four are relevant to every business – many competitive businesses draw their advantage from only one, or combinations of more than one. There is extensive synergy between source-groups and each group is not exclusive. However, the more groups present in a business and present in greater strength, the stronger the competitive position of that business will be.

      Strategy built from at least two source-groups is essential.

      The primary source-groups are as follows:

      2.1 Technology

      •Proprietary, e.g. patent/trademark/ copyright

      •Constant innovation

      •Production systems

      •Integration

СКАЧАТЬ