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In every
organization's life-cycle there comes an inevitable point, in some cases
multiple times, when the company needs to make a strategic shift in its plan of
execution. The "shift" hitting the "plan" is usually driven
by exogenous factors and not by anything that the company has done, or failed
to do. Logically, one may presume that the key question is, "What to do
when the shift hits the plan?"
Actually, there
is one more crucial step before this question can get asked and answered. One
has to take a step back and address the issue of recognizing that the shift HAS
indeed hit the plan. Frankly, recognizing that one has a problem (or a shift)
is often the hardest part of addressing the shift.
The first step
therefore, is to recognize that one indeed has a shift that has hit their plan.
Where does one go to discover if this shift is happening or has already
happened? Clearly, the marketplace will give one a good idea, IF one is
listening. Some of the best sites and places to go to stay abreast of what's
happening in the technology marketplace are listed in the resources section
below. Another key place to go for clues that the shift is here, or may be
coming, is to talk to one's current or prospective customers. Often the
marketplace being driven by customers can highlight the impending shift. But
sadly enough, entrepreneurs and management often become so engrossed in running
or building their enterprise that they don't pay enough attention to their end
customers. Don't make this mistake. Finally, trade shows and industry
gatherings are a good place to learn about coming changes to one's industry or
sector. All of these three avenues should provide ample evidence or inputs to
help one conclude that there is indeed a shift occurring, or that it has
occurred and that one's organization needs to react.
What should be
done about the shift? That becomes the next hardest question. Ultimately it
depends upon the nature of the shift and its ramifications on one's
organization. If the shift is seismic in nature (e.g.,; the Internet), then
clearly it forces a re-think of the entire business model and may result in an
entirely new enterprise than was previously envisioned. If the change is
incremental (from tapes to CDs), then there can be a more moderate response to
this shift. The key, once a shift is recognized, is to determine exactly how
that shift is going to affect the core areas of one's business and hence an
appropriate response can be implemented. The topic of how to analyze the shift
can't be codified in any article, because it is unique to each shift and
organization. But traditionally, looking at one's organization along
operational lines (HR, Finance, Mfg, Distribution, Sales, Marketing, etc) and
analyzing the impact the shift may have on those particular functions, can
provide a good starting point to determine the shift's impact on the
organization.
Next, analyze the shift's impact on the marketplace in terms of competitive or
ancillary products affected by the shift. Are previously unrelated products now
coming together, or is there a movement away from a long standing standard in
one's industry? Finally, consider accessing research from one's industry via
trade associations (those dues ought to be worth something), to help analyze
the impact the shift may have on the general industry and then on one's own
organization. Recognizing the shift and then identifying what impact it may
have on one's organization solves two-thirds of the problem. So, the job is
almost done.
However, don't
relax yet, because these precursors lead to the real job of doing something
about the shift. Typically the nature of the response is gauged to the severity
of the shift and the area of business it impacts most (e.g. moving from shrink
wrapped products to online distribution). Again, it is difficult to codify what
a series of responses may be because each situation and company is unique.
However, as noted above, the response will be based on the area of business the
shift impacts (operationally) and the severity of the shift (total to minimal).
An example of a successful (albeit somewhat late) execution of a shift in plan
was Intel's response to the low-priced PC market, which emerged in the late
1990's. Intel's processors were all priced at points which didn't make them
viable for these sub-$1,000 and in some cases sub-$500 PCs. Intel's response,
after losing the majority of the market here to competitors like AMD, was to
launch the Celeron line of processors, to fight back in this sector. That kind
of response, although later than it should have been, has helped preserve
Intel's dominant position in the processor market place. Adapting to these
"shifts" in the plan is the true litmus test for a management team
and their ability to lead their organizations to a successful outcome.
What is your next shift?
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