Home' Trinidad and Tobago Guardian : November 23rd 2014 Contents Many manage-
expounded on this subject for many
Often the discussions surround
issues such as:
• What is the most effective busi-
ness model for our company?
• What would best describe my
• Is my leadership style reaping
the results that I want?
• How can I help my employees
understand my vision for the organ-
• How can I continue to success-
fully grow my business?"
These represent only a few ques-
tions organisational leaders ask
themselves. These are organisational
pains; issues that keep any CEO or
business owner up late into the night
wondering how to create a success-
ful future. But what is even more
challenging is that today the external
environment is ever changing very
rapidly before our eyes.
Many organisations are also
struggling to realign their internal
changes as rapidly as the external
environment, and CEOs are forced
to make critical business decisions
at breakneck speed with limited
information. Companies must be
flexible and respond to competitive
and market changes for their sur-
NOVEMBER 23 • 2014 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
COMMENTARY | SBG13
Strategy and change
However, before we delve any further,
we need to understand what strategy is.
Professor Michael Porter, in an article
written in the Harvard Business Review,
states: "A company can outperform its
rivals only if it can establish a difference
that it can preserve. Competitive strategy
is about being different. It means delib-
erating choosing a different set of activ-
ities to deliver a unique mix of value."
For example, Dell Computers offer a
unique method of distribution as well
as product differentiation.
Anyone, anywhere in the world can
order a Dell computer, either from its
Web site, or by toll free number. The
customer can order a computer from
Dell, which can be customised to how
he/she wants it. These two activities
represent how Dell differentiates itself
from its competitors.
Similarly, the heavy equipment man-
ufacturer, Caterpillar, has also developed
a unique strategic position over the past
few years. It has focused its efforts of
product development and branding. This
organisation prides itself on manufac-
turing high quality products, which will
not require a large amount of mainte-
nance over years of usage and the client
will save on maintenance costs. However,
the price of its equipment is quite expen-
sive, but due to Caterpillar s branding
strategy and activities, global clients will
not be reluctant to purchase because the
brand resonates very positively with them
and there is no negative post purchase
emotions (also known as cognitive dis-
So, what is strategy?
Dr Manfred Jantzen of the University
of The West Indies defines it as this: "All
competitors who persist over time must
maintain a unique advantage by differ-
entiation over all others. Managing that
differentiation is the essence of long-
term business strategy."
But one must take note that any busi-
ness strategy is only useful if the people
in the organisation can successfully exe-
cute it. It is here leadership plays a pivotal
role in having managers take ownership
of certain aspects of the strategic plan.
Deadlines are imposed for execution,
budgets are agreed upon to provide the
resources to achieve the strategic objec-
tives, and talent is sourced to bring greater
competitiveness to the company. How-
ever, we often hear from traditional busi-
ness owners that profitability is being
achieved, and things are working great.
Therefore, why do we need a strategic
plan, or why do we have to change?
Let us answer these questions by
considering the following:
At one point in time, (perhaps at the
turn of the 20th century) one witnessed
how some companies dominated the
landscape. They were described as large,
possessed abundance of capital, and were
bent on maintaining the status quo.
Overtime, these companies success
formula took on a life of their own, inde-
pendent of any competitive usefulness.
People kept doing more of what worked
in the past without questioning the
All of this was accepted at that time,
as long as the competitive environment
remained unchanged. But then, dramatic
shifts began to take shape in the external
environment: regulation, consumer tastes
and technology. These significantly deval-
ued a company s success formula. Man-
agers saw these changes coming and
attempt to respond by continuing or
even accelerating actions that reinforced
the existing successful formula.
Donald Sull, renowned author and
professor of competitive strategy at the
London School of Business, states that
organisations that demonstrates the ten-
dency to respond to even the most dis-
ruptive shifts in the environment by
accelerating actions that worked well in
the past, are stuck in what he termed
Professor Sull goes on: "Companies
trapped in active inertia can exhibit some
strange behaviour. They engage expensive
consulting firms but fail to implement
their recommendations. They adopt new
technologies or business models without
abandoning the old. They take a series
of half steps that are too small to fix the
fundamental problems but large enough
to exhaust the management team and
convince them they are doing something.
The situation resembles a car with its
back wheels stuck in a rut. Managers
step on the gas, only to dig the hole
It is at this point of the organisation s
life cycle that fundamental change needs
to take place. Otherwise the organisation
may just fold up and die.
Dr Manfred Jantzen, perhaps best
known for his original work on complex
adaptive systems, states that:
"It is the primary role for the CEO to
drive change within his organisation.
Even if this means giving your current
managers a golden handshake and bring
new talent on board. Also, the CEO has
to understand what the key performance
indicators/metrics are used for driving
These indicators need to be commu-
nicated throughout the organisation, and
everyone must be clear on what their
role is in driving acceptable levels of pro-
ductivity and profitability."
In closing, the CEO must accept the
fact that change is a way of life. This
implies that he/she must be always look-
ing for ways to improve and realign their
organisation and, at the same time, take
responsibility for crafting the most appro-
priate organisational culture for the pur-
poses of embracing change. Hence, strat-
egy is not cast in stone, but changes as
the need arises.
Jai Leladharsingh is an independent
researcher and consultant, and a mem-
ber of the board of directors of the
Chaguaramas Development Authority.
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