As the
market becomes chaotic the need to change the strategic formation models
becomes apparent to match this need. Strategic behavior is associated with
capital resources and the competencies of the corporation. A paper by EL Namiki
in the Ivey Business Journal (2013) helps in furthering the Systemic Strategy
Analysis Model (SSAM) of strategic thinking which understands the flows of thought
formation within companies in order to analyze a company’s competitive
position.
Strategic
behavior is seen as a process of developing and enacting choices. Systematic
strategic behavior focuses more on the developing and enacting of choices that
are in alignment with the structural and environmental constraints of an
organization. Strategic business choices, by their nature, are more confined
than those enacted by individuals. Proper analysis is needed to define
corporate strategy.
Where
resources and company attributes meet each other there is a strategy that could
be developed to full bloom. When the
attributes and resources change there would be a shift in the overall strategic
trajectory. The path would adjust based upon the most advantageous route to
achieving objectives. It is possible to map these concepts and draw out
possible strategies. Consider the following four concepts when developing a
strategy:
Seeking Concentration:
Concentration
relates to the overall concept of market saturation. When a small amount of
firms dominate an industry, it is said to have high concentration. If a large
amount of entrepreneurial or boutique firms exist within an industry, there is
a low level of concentration. The success of achieving a level of market
presence will depend on the ability to meet the challenges of the environment
based upon competing companies.
Seeking Competencies:
Competency
is a level of strong and competitive performance in a particular domain. It
could be anything that furthers a strategy such as distribution, product
design, technology, etc… Organizations seeking to enhance a competency either
hire the right people or train them with competitive skills. Successful firms
like Google have attracted the right talent to further their strategic
competencies.
Seeking Focus:
At times
it is necessary for companies to narrow down their efforts and focus on core
offerings in order to enhance those things they excel in and remove activities they
do not excel in. This may mean selling off brands that do not enhance core
competencies or outsourcing internal functions that distract from the core strategy.
Improving upon core competencies creates higher levels of competitive
advantage.
End Game:
When a
company has maximized profits and a period of low profits sets into product
lines or services they should consider an end game. This end game occurs when competitive
offerings decline and there is little hope of recovery or the products have
lost their market luster. Generally, this is a result of root misalignment
between the offerings and current market needs. A strategy should include when
to get out of the market and move onto new products and services.
El Namaki,
S. (2013). Strategic thinking for turbulent times. Ivey Business Journal, 77 (4).
