Strategy: a plan, method, or series of maneuvers or stratagems for obtaining a specific goal. Sounds simple enough, but is it? In many cases company strategy is implemented or facilitated through the deployment of IT capabilities, whether new or improved software systems, equipment and processes. First, let’s look into the competitive lay of the land, since that is the battlefield where retained earnings and EPS are made.
Today’s dynamic markets and technologies have called into question the sustainability of long term strategic competitive advantages. It seems that the new norm is the battle of the competitive tactical S-curves. The best many companies can hope for nowadays is for a series of smaller dynamic temporary competitive advantages. These are temporary because technology allows competitors to quickly imitate and/or overcome them. The temporary advantages need to be fast to implement and easy to move from before they reach the point of marginal returns in the face of a competitor’s move. When your competitor(s) is able to match your own competitive advantage S-curve, you should not be there anymore. This makes the competitor spend significant resources into developing a response to your advantage, only to find his/her own S-curve will never reach full performance level because he/she is now responding to thin air.
Under pressure, company and IT leaders have adopted tools to improve their strategy implementation, competitive posture, productivity, quality, and speed, such as Balanced Scorecard, DevOps, Agile, Big Data, Business Intelligence analytics, etc. Dramatic operational improvements and temporary advantages have resulted in some cases, but rarely have these gains translated into sustainable profitability across the board.
The problem with the “tool du jour” approach is that the tools have taken the place of grand strategy. They tend to be implemented as stove-pipes and not overarched by a common strategic framework. This sub-optimizes companies and creates the illusion of effectiveness. Although many of these tools are beneficial when implemented properly (again properly), they are not a substitute for a comprehensive strategic framework that integrates the tools with your good old fashioned strategic plans where governance, financials, technology, people and the interests of stockholders meet.
How well are you doing in this area? It never hurts to get some validation, after all, your company’s risk management effort demands it. Our executive experts are ready to assist you in a completely confidential setting. Give us a call and let’s have the conversation.