The Perils of Bad Strategy

Bad strategy abounds, says UCLA management professor Richard Rumelt.  Senior executives who can spot it  stand a much better chance of creating good strategies.

Horatio Nelson had a problem. The British admiral’s fleet was outnumbered at Trafalgar by an armada of French and Spanish ships that Napoleon had ordered to disrupt Britain’s commerce and pre-pare for a cross-channel invasion. The prevailing tactics in 1805 were for the two opposing fleets to stay in line, firing broadsides at each other. But Nelson had a strategic insight into how to deal with being outnumbered. He broke the British fleet into two columns and drove them at the Franco-Spanish fleet, hitting its line perpendicularly.

The lead British ships took a great risk, but Nelson judged that the less-trained Franco Spanish gunners would not be able to compensate for the heavy swell that day and that the enemy fleet, with its coherence  lost, would be no match for the more experienced British captains and gunners in the ensuing melee. He was proved right: the French and Spanish lost 22 ships, two-thirds of their fleet. The British lost none.

Nelson’s victory is a classic example of good strategy, which almost always looks this simple and obvious in retrospect. It does not pop out of some strategic-management tool, matrix, triangle, or fill-in-the-blanks scheme. Instead, a talented leader has identified the one or two critical issues in a situation—the pivot points that can multiply the effectiveness of effort—and then focused and concentrated action and resources on them.

ACTION POINT: A good strategy does more than urge us forward toward a goal or vision; it honestly acknowledges the challenges we face  and provides an approach to overcoming them.  

Study Leadership Moments

 a powerful reminder to examine whether you yourself are employing all the necessary principles.

A first step for learning to apply the Leader's Checklist is to become a self-directed student of leadership.  This study can take many forms:

• reading leaders' biographies
• witnessing leaders in action
• joining leadership development programs

What's critical is witnessing how others have worked with a full checklist or fallen short, often a powerful reminder to examine whether you yourself are employing all the necessary principles.

ACTION POINT:   Sharpen your leadership skills by learning from others in leadership positions.

green Business and the Growing Role of Government Conclusions II

The more complex value proposition and business case of many green business opportunities will demand a more consultative sales approach.

Distributors looking to turn the trends to their advantage will need to consider the following:

1. Building a deep understanding of the the underlying issues and drivers in both green business and government opportunity areas, positioning themselves as knowledgeable, trusted business advisers to customers and suppliers.
2. Integrating green business into their broader business strategy investment plans and human capital strategy.  The more complex value proposition and business case of many green business opportunities will demand a more consultative sales approach.
3. Work with trusted advisers, trade associations, government representatives, accountants, and peers to deepen knowledge of relevant existing legislation and regulations. 

ACTION POINT: Invest the time and effort into understanding the effects of trends on your business and market.

Green Business and the Growing Role of Government Conclusions

Each trend presents a host of real challenges and a wealth of potential opportunities for distributors,

Looking ahead, green business and the growing role of government will continue to gain momentum and have an impact on wholesaler-distributors.  The myriad green business segments have gained a critical mass and sufficient acceptance to be considered mainstream, and the role of government are sufficiently important and topical to warrant inclusion here.

Each trend presents a host of real challenges and a wealth of potential opportunities for distributors, both within their own organizations and with customers, suppliers, and markets.  Therefore distributors must stay abreast of these trends and their drivers and consider their impact on strategies and operations under various scenarios.

ACTION POINT: Look for opportunities within the green business segment and understand the role of government in your industry.

The Expanding Role of Government

government expansion is widely perceived as a drain on the overall economy, absorbing capital and stifling growth. 

Around the world and across industries there is a widespread perception that government has and will continue to plan an expanding role in business and society.  In some instances, this expanded role stimulates demand, mitigates risk, and removes uncertainty and ambiguity; having a positive impact on the economy.  Indeed, a number of distributors have reported growth in their government-related business.

However, these examples are limited.  Because of the expanding payrolls and budgets that come along with it, government expansion is widely perceived as a drain on the overall economy, absorbing capital and stifling growth.  The areas that wholesale distributors will most likely feel the government's role are:

• Environmental and safety regulations
• Immigration and labor
• International and domestic trade
• Stimulus, taxes, and tax incentives

ACTION POINT:  Understand the growing role of government and it's impact on your business in the areas above.