Looking to the Future

When you control enough factors in your environment, you become the market leader and set the standards for the whole industry

One of the most important aspects of strategic management is predicting the things that will impact you and your organization in the future. Some of these are bigger than you, and you cannot change them. Others are within your power to change. Knowing what you can change and what you need to work around will help you to use your resources efficiently.

Macroeconomic (related to the big aspects of an economy, such as inflation, economic growth, recession, and levels of employment) factors are major forces that impact not just your organization, but also your competitors and your marketplace. They may impact other markets, the country, and sometimes the world economy. While you as a team or organization cannot change or control these things, you can seek to understand them and create strategies that fit in with them.

Many other factors are within your sphere of influence, and when you control them, you can set the agenda. When you control enough factors in your environment, you become the market leader and set the standards for the whole industry; if, for example, you decide to reduce your prices, your competitors are forced to reduce theirs.

Large organizations can exert huge control--even dictating government policy--but even if you cannot aspire to this level of power, you should attempt to implement strategies that give you as much control as possible. The more control you have, the fewer surprises you'll encounter and the more likely you are to survive in the longer term.

ACTION POINT: Set the agenda by understanding the factors that are within your sphere of influence.

The Gift of Knowledge and Reality

Your face, Lord, do I seek. Psalm 27:8

There is a certain humbling character that the Gift of Knowledge imparts -- namely that we are basically prone to illusion and that our way of looking at life is not the only way and certainly not the most accurate. Such knowledge opens us, like the
opening of mind and heart that we pursue in centering prayer, to the reality of God just as God is...The Gift of Knowledge is an intuition into the fact that only God can satisfy our deepest longing for happiness...The Spirit of God in response to our centering prayer practice provides perspective for the energy that is channeled into...the daily frustration of our immoderate desires. The Spirit says to us: "You will never find happiness in any of your instinctual needs. They are only created things, and created things are designed to be stepping-stones to God, and not substitutes for God." The Spirit presents us with the true source of happiness, which is the experience of God as intimate and always present.

Psalm 27:8 "Come," my heart says, "seek his face!"

Gaining Advantage

To be sustainable, competitive advantage needs to be difficult or impossible to copy.

Without sustainable competitive advantage, your organization will always be vulnerable. Imagine your organization will always be vulnerable. Imagine you run a pizza restaurant in a small town, where you share the market with two competing pizzerias. You decide to win more business, so you differentiate yourself by offering a home-delivery service. Within a month your turnover has doubled: you have achieved competitive advantage. But seeing your success, your competitors also start to offer delivery and within another month, your sales have returned to their previous levels.

The problem is that this competitive advantage was just temporary. To be sustainable, competitive advantage needs to be difficult or impossible to copy. In this example, this could mean investing more expensive premises--located between the shopping center and the cinema, say--that a large number of people will pass by. Your rivals cannot occupy the same site, so you have a sustainable competitive advantage over them.

What are the potential sources of sustainable competitive advantage that your organization should seek to develop? Location is clearly key in the retail sector, but sources of sustainable competitive advantage can be identified in every industry:

• Size: being bigger gives you control of the market and achieves economies of scale.
• Knowledge: a big-city law firm, for example, may have more knowledge than a smaller firm.
• Resources: control of limited resources of any kind.
• Relationships: key relationships with decision-makers cannot be easily coped by your competitors.
• Brand: while it is easy to copy a product, it is difficult to copy the emotions customers feel about a particular brand --that's why organizations invest so heavily in brand identity.

ACTION POINT: Identify the knowledge, resources and relationships that can help you gain competitive advantage.

Leading Your Competitors

Competition is not limited to organizations providing the same service or selling the same products.

Your business, and every team within it, must have a source of competitive advantage--an overriding reason why customers will want to do business with you rather than a competitor. Understanding, identifying, creating, and sustaining competitive advantage is at the heart of good strategy.

Competition is not limited to organizations providing the same service or selling the same products. Much of your competition may be indirect. For example, for the strategic manager of a bowling alley, another bowling alley in town is a direct competitor. However, bowling is a form of family entertainment, so that manager also needs to consider competition from the movies and the local pizzeria. The leader of a team within an organization will be in direct competition with other teams within the organization that can provide the same service, but will face indirect competition from external companies that could also provide the is service.

ACTION POINT: Identify who your direct and indirect competitors are and develop a competitive advantage against them.

Unifying the Organization

A well communicated strategy sends the message: "We're all in this together."

A clear strategy acts as a unifying force within an organization. You may have worked in organizations where the staff focus only on their job and don't understand how it fits into wider processes and objectives (and perhaps don't even care). This results in confusion, frustration for staff and customers alike, and ultimately a short-term future for the organization.

By creating a clear strategy and sharing it with your team or organization, everyone knows where they are going: people are then far more likely to adjust their behavior to make the whole enterprise work better. A well communicated strategy sends the message: "We're all in this together." Having a destination is very powerful in terms of human motivation because we are motivated in one of two ways: "away from pain" or "toward pleasure." The former leads to behavior that achieves a short-term result, but having moved away from pain we may end up in a place we are not so keen to be. If we move toward pleasure we will be more likely to achieve a goal that we want to sustain.

ACTION POINT: Move away from pain toward pleasure.