If you are watching the economic trends there is plenty to be concerned about.
In recent days even GE has warned investors that this will be a tough year. Given the trends, executives are being challenged to lead their companies through what is becoming a weaker economy. The easy answer is to cut costs, reduce headcount and reduce service levels. Most of us that have read the books often share this conventional wisdom. The reality is that conventional wisdom will only take you where everyone else is going. We challenge you to rethink your strategy, to navigate your company out into blue waters.
Many executives view this as a time to hunker-down or retrench. This means many companies are cutting costs, cutting heads and cutting budgets. We have been advising our clients that this is no time for trench warfare. You see, the trench is no longer safe. The status quo is no longer a defensible position so the first companies to move out of them will be the ones that are better able to establish a sustainable future position.
A more successful approach would be to spend your time trying to out-think the competition and innovate in the marketplace. It will require more aggressive thinking and faster responses to the changes. Many of us live for times like this when we can demonstrate the vitality of our leadership through bold moves and calculated risk-taking.
For the corporate executive, times like this are times to celebrate. These are opportunities to change the rules of the game. These are times to take a fresh look at your business assumptions and your business opportunity to exploit the pressures being exerted by a changing environment. Changing the rules of the game will provide you the ability to pull ahead of the competition, provide new products or services, and improve the intimacy you have with your existing customers.
Getting Aggressive
Aggression is successful when it is smart. Businesses are battling for position in a tough and transparent world, so maintaining or improving that position is the goal of our competitive moves. We jockey for positions of strength with our customers, our competitors and our company. This brings new requirements to our planning because we do not need to waste resources or time. We have found that two new business characteristics become important during lean economic times: 1) agility and 2) foresight.
Competitive Agility
Competitive agility is about how we quickly assess and refine our strategy. Not just on paper, but in the context of every day decisions. Companies that have strategic processes in place are often way ahead of the game. More important, the victory goes to those companies that can not only “update the plan” but “realign resources and efforts”, adapting more quickly to changing market conditions. This is a level of process discipline that should only be strengthened in leaner times, because it drives real competitive advantage.
