Services
Business Advisors & Strategy Consulting
The traditional approach to strategy requires precise predictions and thus leading business owners to underestimate
uncertainty.
This can be downright dangerous. A four-level framework can help.
At the heart of the traditional approach to strategy lies the assumption that executives, by applying a set of powerful analytic tools, can predict the future of any business accurately enough to choose a clear strategic direction for it.
The process often involves underestimating uncertainty in order to lay out a vision of future events sufficiently precise to be captured in a discounted-cash-flow (DCF) analysis.
When the future is truly uncertain, this approach is at best marginally helpful and at worst downright dangerous. Underestimating uncertainty can lead to strategies that neither defend a company against the threats nor take advantage of the opportunities.
Another danger lies at the other extreme: if managers can't find a strategy that works under traditional analysis, they may abandon the analytical rigor of their planning process altogether and base their decisions on gut instinct.
Making systematically sound strategic decisions under uncertainty requires an approach that avoids this dangerous binary view. Rarely do managers know absolutely nothing of strategic importance, even in the most uncertain environments. What follows is a framework for determining the level of uncertainty surrounding strategic decisions and for tailoring strategy to that uncertainty.
Strategy Plans - Preparing Yourself For All Things
Did you know that:
75 % of businesses never prepare a budget.
20% of businesses spend > 16 weeks preparing a budget and don’t complete it by the start of the financial year.
78% of business with a budget don’t even change the it in the financial year.
85% of business owners spend less than 1 hour a month discussing strategy.
60% of business don’t link strategy to the budget.
92% of businesses don’t prepare “strategy data” to navigate the business.
How do profitable companies stay ahead and continually change quickly ?
The answer: they understand the power of a Strategy Plan.
This powerful tool was once exclusive to large companies. With deep pockets, they employed experts to prepare a Strategy Plan.
Why is it that small businesses prepare business plans and never implement them ?
Answer: They first jump to the Second step- the business plan
You must first prepare a Strategy Plan !
Small business faces fast and hard competition and your edge today is gone tomorrow !
Where do you start ?
The greatest stress for the small business owner is the lack of TIME they have to “step out” and check the road map.
Without a clear and easy to implement strategy plan, business owners make important decisions without all the facts, or worse, will not make a decision at all.
Either way, the result could be catastrophic.
When you look at the forces that drives competition (see below), it is no surprise that small business is screaming out for expert guidance.
Main Forces that Drive Competition
- bargaining power of suppliers
- threat of new entrants into your marketplace
- bargaining power of your buyers
- threat of new substitutes
- the rivalry between your existing competition
Our experience has shown that with some guidance, business owners can make a difference to the business when a clear strategy plan is explained and put into place.
Standard Edge is a company that helps business owners prepare and execute the Strategy Plan.
We help businesses to develop tools and skills and an understand ing how successful businesses work.