Float like a butterfly, sting like a bee: Strategic options in an uncertain world
By Rosemarie Szostak, Ph.D., Nerac Analyst
Originally Published August 15, 2016
Muhammad Ali was known for his agility, improvisation and speed. That set him apart from and above all his rivals. He became one of the most celebrated sports legends of the 20th century. Your company can benefit when you introduce Ali’s qualities to your strategic business decision process.
So what is holding you back? In a word, forecasting. It is that crystal ball you turn to in order to help chart you course into the future. Yet Google “folly of forecasting” and everyone agrees that relying on forecasting to plan your strategy is just that, folly. A forecast is obsolete almost as soon as its packet of electrons heads down the wire from the forecasting service. Ask a mother planning a weekend family picnic after checking the weather forecast. She will tell you that it is always prudent to pack an umbrella.
You have a number of strategic options to move forward and win in the business ring.
Option 1) Continue selling your product to your customer base
Option 2) Provide incremental product improvement
Option 3) Find new markets for existing products
Option 4) Develop a disruptive or break-out product/technology.
Sticking with the status quo (option 1) is a great strategy until a competitor comes in and provides a better, cheaper, faster product. Or the customer base evolves. Ever try selling buggy whips to the SUV crowd?
If you want to stay on top of your game, hedge your bets. Continue selling your product to customers (safe bet) and maintain a crack R&D team to continue to improve your products and mitigate any threat from the competition (also a safe bet). Now here is where companies have the opportunity to greatly enhance their business (option 3) — find new markets for their product. As your customer base evolves, so does customer bases in other markets. A supplier to an adjacent market may not do their due diligence (option 2) and a vacuum is created that would allow a new supplier with a different product to enter and grab market share. That could be you.
Your R&D team is a critical investment, not only for option 2 but for options 3 and 4. The company that fosters an environment of innovation and flexibility, both in personnel and management of them, has the potential to turn their company into the next winner. Option 4 is the most risky of the options.
If you don’t maintain a diverse portfolio of strategic options, from safe to speculative, and only rely on forecasting and crossed fingers to project future earnings and growth, you are destined to be KO’d in the first round.
Winners in the ring aren’t created from nothing.
Neither is that true for your business. Both require flexible teams that can be assembled rapidly, drawing in the best talent as needed. Dynamic and fluid teams further minimize risk across all strategic options. This is where the analyst teams at Nerac can help.
Many managers understand the risk of hiring the talent needed to round out a team. Full-time employees are a long term commitment. If your R&D project is speculative at best, you may be reluctant to hire someone permanent. Nerac can function as that additional team member specialist. As your sparring partner, we can help you prepare to enter the ring. Nerac analysts are highly trained researchers with access to a myriad of databases at their fingertips and assist company teams employing all of the strategic options. We can provide your R&D team the support they need to:
Option 1) Identify competitors and potential competitors by mining patent and market databases. This can provide intelligence on competition poised to enter your lucrative product segments. Save you from that sucker punch.
Option 2) Efficiently research patent prior art as well as technology advances in product-related fields so your team can move towards improving your product line with the knowledge needed to nimbly lower the risk of this option.
Option 3) As your team looks to adjacent markets, you can tap the diverse expertise of Nerac analysts to research those markets, identify the potential competition, their strengths/weaknesses, and help find realistic entry-points. This provides hitting power for the team to make decisions whether to enter that market and make it a knock-out.
Option 4) Entering the fight of the century — disruptive technology — a team needs to be lean and mean and ready to take all comers. Odds are high that your team will lose but if successful, the rewards are astronomical (theme song from Rocky here). Your team needs the best information, the best foundation to press forward. The absolute best over a broad range of both technologies and markets. As you move your innovation forward, Nerac analysts can act as your second at ring-side. We help you identify what vendors can be brought on-board as part of your supply chain, what companies would make solid business partners to take your innovation over the top. You need to know whether your idea can ride a trend to gain footing in the market before your product breaks-out and becomes its own trend. You need information, you need it quickly, and you need it updated on a regular basis between bells. Nerac analysts can provide these services to you. We identify vendors and potentials partners or analyze M&A targets.
How Can Nerac Help?
As a VP, a section manager or a lead researcher, each day you walk into your building is another day closer to your fighting weight. In time, you will enter that ring in Manila with the mighty Joe Frazier facing you in the opposite corner. You want to insure that your team and Nerac has prepared you to make those nimble, far-reaching, and powerful decisions that will win your company that prize fight. Call us at 860.872.7000 or click here to contact us today.
Rest in Peace Muhammad Ali, you knew how to go the distance and what it took to be a winner.