Scope and uses of strategy dynamics

Who can use Strategy Dynamics?

The approach is applicable to all strategic challenges …

• in any context - new ventures, growth, maturity, strategic change, turn-round ...
• in any sector - telecoms, consumer goods, professional services, utilities, transport, retailing, consumer services, banking, public services, the voluntary sector and other non-profit cases
• with specific implications for every function - marketing, operations, human resource management, organisational development, finance ... as well as for the overall strategic management of the business

The method tackles head-on how competition plays out through time, whether for customers or for other scarce resources.

The principles and frameworks behind the Strategy Dynamics approach are built on sound theoretical foundations that have implications throughout the management field, as well as in many others. At the same time, the approach is practical and clear, understandable by everyone with a professional interest in business. It is, however, an approach that is 'deceptively simple'. The content of this website and the publications we offer will provide some insight into the approach and we also offer courses and other services for strategy professionals and managers who wish to enhance their understanding of the practice of it.

Why should managers be interested in Strategy Dynamics?

If you are a CEO or member of senior management team you have a continuing responsibility to have sound answers to strategic questions - why the organisation's performance is progressing as it is, and how that performance can be improved, sustainably, into the future.

For these answers to be achievable and effective managers need specific policy recommendations what to do, when, how much, and in what order. The strategy needs to take into account the coordination between different functions, propose mechanisms for monitoring and adjusting policies and predict the likely outcomes as the future unfolds. Strategy Dynamics is an approach that works back from a key strategic question to its component parts in a way that enables individuals and teams to do just this.

You need an approach to strategy development that

• is strongly fact based, rather than relying on differences of opinion or political influence amongst your team and throughout the organisation
• deals with all aspects of strategic challenges, rather than relying on a single 'magic bullet', such as down-sizing, building a core competence, or being 'customer-focused'
• is easily and clearly communicated, rather than being complex, or ambiguous in its meaning or implications for what people are to do
• has clear implementation tasks - who is to do what, when, how much, coordinated how with others, and producing what anticipated outcomes into the future
• is adaptable, to cope with the unavoidable uncertainties about how our situation is evolving, and how outside events may disrupt our plans
• gives you control over your destiny

Strategy Dynamics and business consultants

Strategy consultants are retained to help clients answer the strategic questions as to why their organisation's performance is progressing as it is, and how they can improve that performance, sustainably into the future. (Your past education and training is unlikely to have provided you with the tools to answer these questions.) You therefore need a tool-set that fulfils the needs of the CEO and senior management team.

Consultants are brought in because they bring expertise and capacity that is beyond what is available to the client organisation itself. You therefore have additional needs -

You need an approach to strategy development that ...

• is a rigorous and reliable method, rather than the many qualitative and ambiguous methods available in the strategy field today
• focuses on the substance of the business, i.e. its resources and capabilities, rather than the purely financial measures that dominate current quantitative approaches to strategy
• is fast, holistic and reliable, to understand rapidly what is going on, rather than the lengthy shopping-list of possibly irrelevant issues that typically arise early in client assignments
• provides a means of directing the analytical efforts of the team, to avoid the tendency to 'boil the ocean' in the hope of distilling some nuggets of insight
• provides a persuasive means of communicating your findings, to ensure understanding by the client, and raise the chance that those findings will be acted upon, rather than the big stacks of disconnected exhibits that risk bemusing the client instead of enlightening them.

Why should Entrepreneurs be interested in Strategy Dynamics?

In attempting to build a new venture from nothing, entrepreneurs face a difficult challenge in persuading investors to fund their proposal - there are so few facts to go on. Often, then, the investors' support comes down to belief in the managerial abilities of the fledgling team. Strategy Dynamics, though, offers both you and your backers an extra degree of confidence ...

• Your future performance will depend on your ability to collect, develop and retain critical resources - products, people, customers ...
• This may be feasible if the environment in which you hope to operate offers potential resources for you to exploit ...
• ... provided established firms and rival start-ups don't steal them from you first.
• Your emerging business system will start to generate cash at a rate that reflects the soundness both of your assessment of these factors and your team's ability to win and sustain them.

Strategy Dynamics in human-resources

The HR field is beset by serious challenges that are unavoidably dynamic - your situation today will reflect strongly both successful choices and errors made over many years of history.

• Hiring decisions a decade ago are evident today in the availability of senior staff with this degree of experience
• Staff attrition rates feed back into working conditions for remaining staff, driving still further challenges of staff retention and development
• Training and development efforts for your people are reinforced or confounded by staff dynamics

It can be difficult to demonstrate to senior colleagues the value of HR interventions, when the lead-times are long and the mechanisms by which they act are poorly understood. Competitive Strategy Dynamics includes many illustrations of HR and organisational challenges, that will be familiar to professionals in the field, but that have been, until now, difficult to grapple with in a systematic manner.

Strategy Dynamics and marketing

The marketing field offers a rich array of challenges that are insoluble without a sound dynamic interpretation.

• The task of developing and retaining customers is a long-term process, in which confident connections between your marketing investments and eventual revenue and profitability flows are, at best, indistinct.
• Many factors outside your control conspire to drive customers out of your grasp and dissipate their commitment to your firm and its products and services.

Your contribution depends on shifting subtle perceptions and values amongst customers, dealers and other stakeholders, with little confidence as to the effectiveness with which this is being achieved, or the consequences for business performance that arise. Competitive Strategy Dynamics includes many illustrations of marketing-related challenges, that will be familiar to professionals in the field, but that have been, until now, difficult to grapple with in a systematic manner.

Why should Investment analysts be interested in Strategy Dynamics?

Strategy Dynamics starts from recognising that investors (whether outside shareholders or corporate HQ) are concerned with growing and sustainable earnings.

• existing analysis methods offer little help in getting from the strategy statements commonly agreed by executive teams, to a quantitative estimate of future performance
• this approach is rigorous, fact-based and quantitative
• it is also amenable to being adapted; as new information or insights into firm performance become available Strategy Dynamics enables you to guard against serious pitfalls that are common in financial appraisal of firm prospects ...
  
  ... hopelessly unrealistic projections of innovative strategies, whether for new ventures or established firms, such as those that decimated corporate America after the dot-com bubble burst
  
  ... under-estimation of the minimum initial resource-commitment required to drive new strategies
  
  ... projection of unsustainable profitability by firms who have pursued 'cost efficiency' too far, often in response to ill-informed outside commentary You will not have come across this method before, since it has only been developed and codified in the last few years, and is only now being disseminated through 'Strategic Management Dynamics'.