Career Coach: The art of being prepared for when the market shifts

Managers today need to be constantly in tune with what's happening in their industry and organization, regardless of whether they lead a team within a company or head up a major corporation or nonprofit. When the forces driving a particular market change you need to change with them. Doing so is how some organizations pull ahead and leave the competition behind.

How can managers get an early clue that a new strategy -- or an old one, for that matter -- isn't achieving the desired results?

-- Know and anticipate your customers and clients. People change their behaviors and change their preferences. For example, we used to love to go to video stores to browse for weekend movie selections. At that time, few people saw that selecting videos online and having them delivered by mail (or via the Internet) would be the huge business opportunity of the future. But if you worked for Blockbuster a decade ago, it would have been a nice thing to find out. Do people actually enjoy the time spent in the store? Do they mind being on a timer -- and incurring late fees if they return a video late? Managers should be aware of their customers' feelings, but the problem is these signals are not always very clear. You need to make friends with ambiguity to be able to look into the unknown to make decisions. There are -- unfortunately -- no statistics about the future.

-- Look for early clues. Once you get to the point where there's nobody in the Blockbuster store on a Saturday night, it's too late. You need to get the clues early. Each industry has early indicators. It is an art to find them, though. For example, if you want to get an early hint how the Christmas shopping season might go, look for the sales reports of corrugated cardboard. They often indicate how much shipping is expected.

-- Every signal is valid. Most measurements we use for strategy are measures that are exposed -- annual returns, monthly sales data, etc. Pay attention to even slight monthly changes and assess with a broad perspective. What does a slight dip in sales data each month really tell you about your current strategy? What can you tweak now to improve? Financial data that we usually use to make investment decisions comes much too late. It's more the subtle, early warning signals that you need to look for.

-- Cast a wide net. Don't just consider what is happening within your industry or organization. Most critical changes happen outside your industry -- increased bandwidth is the driving force behind moving movie rentals online now. Changes in market fees, changes in the resources available, changes in the political environment where new regulations may come into play -- all of these things could render your current business model invalid.

-- Strategy cannot be a project. Strategy decays over time; it requires ongoing evaluation. As much as you can't catch up with brushing your teeth by doing it for three hours in a row, organizations should not treat strategy like an annual event. It should be happening continuously from all angles.

-- Explore your options. Strategy has to have options. To quote former heavyweight champion Mike Tyson: “Everyone has a strategy until they get hit.” Everyone has a strategy on paper, but once one or two assumptions change, this strategy can fall flat. Most businesses need a plan B and a plan C in their strategy in case one of their major assumptions doesn't pan out.

-- Create multiple battle plans. And prepare them ahead of time. It's very bad to have a battle plan change in the heat of the action. For your plan B and C to be effective, you need an indicator that tells you when to switch over. That's where the early warning signs come in. You need to be ready to see the signals so you can move faster than your competition.

The more planning you do ahead of time, the better chance you have of staying nimble and reacting swiftly to changes in the market. That's the key.

Oliver Schlake is a senior business consultant, entrepreneur and researcher. He has been an international management consultant and strategic adviser for leading companies and government agencies in Europe and North America.

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