Senior executives commonly ponder such questions as “What might give us continued competitive advantage?” and “What new products should we make or markets should we enter and how?” These questions go to the heart of a firm’s strategic vision — the shared understanding of what the firm should be and how it must change. I present a framework to help managers answer such questions critically and creatively. Knowing the answers constitutes the difference between muddling through and managing with confidence and foresight.
The framework has four steps:
- Generate broad scenarios of possible futures that your firm may encounter.
- Conduct a competitive analysis of the industry and its strategic segments.
- Analyze your company’s and your competition’s core capabilities.
- Develop a strategic vision and identify your strategic options.
The information generated by the first three steps is plotted on a matrix that helps managers see the direction (step four) they should take. The goal is to develop those core capabilities that will be effective for multiple strategic segments in several different possible futures. My approach to strategic vision building belongs to a newly emerging school of strategy called the “resource-based view.”1 Proponents of this approach view the successful firm as a bundle of somewhat unique resources and capabilities. If a firm’s core capabilities are scarce, durable, defensible, or hard to imitate, they can form the basis for sustainable... To read the complete article, login or sign-up using the form below.
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