Strategy in uncertain markets requires active waiting
Strategy in uncertain markets requires active waiting. That is what Donald N. Sull says in HBR of September 2005. Furthermore, he identifies a number of management principles for surviving and thriving in unpredictable markets. These principles, taken together, define "active waiting":
- Keep the vision fuzzy and the priorities clear.
- Conduct reconnaissance into the future. Send probes and watch for anomalies and gaps.
- Keep a war chest. Save cash for when disaster strikes or when faced with a golden opportunity.
- Maintain the pressure. During the waiting, focus on improving operational efficiency.
- Declare the main effort. Decide and communicate. Focus all resources on the golden opportunity.
Doing active waiting well requires from leaders that they are patient, disciplined and alert during the waiting process, and courageous and bold during the rare times of major disaster or major opportunity. Not many people are capable of aligning their leadership behavior to these crucial external circumstances.
1 Comments:
I agree with these observations. I would think that, although acting on an uncertain market, it would be most usefull for entrepreneurs and smaller businesses to apply this approach to their strategic planning/thinking. Larger companies would off course have more resources available to shape out their market and business environments, but nonetheless very good observations.
I focus mainly on business strategies on the Internet, and without a doubt these observations are extremely important to act upon. Keeping an open mind and creating flexible strategies are essential for online entrepreneurs and smaller online businesses. I have made an analysis on the subject of "Strategy on the Internet" myself, in which I draw keenly upon the theories of Mintzberg and Porter in order to have created a framework that can be used as a guideline for online businesses, in order for them to act with the most strategic control possible on emergent and dynamic markets.
Strategy on the Internet. An in depth analysis and a must read for every Internet entrepreneur and online business manager
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