- Stage 3 is a Failure of Tactics. These are HOW mistakes. They occur when you fail to build robust systems, forget to measure carefully, and get lazy with the details. A Failure of Tactics is a failure to execute on a good plan and a clear vision.
A tactic is a plan to take advantage of opportunities or to manage your business risks as they happen. Unlike a Strategy, a tactic makes no assumptions about the future but instead simply reacts to the current situation.
Where strategy provides long-term direction to a business, a tactic deals with day-to-day realities to seek gains and avoid losses.
Here is a list of a few examples of business tactics.
1. Sales
A tech company has a sales strategy to achieve a 50% gross margin. However, a large deal comes along and the company has solid intelligence about a lower bid from a strong competitor. They offer a price that represents a lower margin of 30% because they're sure that it's the only chance of closing that deal.
2. Quality Assurance
A chain of fast food shops gets an urgent call from a supplier who notifies them that a particular batch of flour might contain a small, sharp piece of metal that broke off a grinder. Management immediately calls every warehouse and retail location and asks them to check the batch numbers on all flour supplies before making any more food packs. The company is able to return all the potentially dangerous flour to the supplier unopened.
3. Marketing
A chain of coffee shops faces customer anger after they raise coffee prices by 15%. In response, a competing fast-food chain that has a long-term strategy to sell more coffee, offers free coffee to all customers on weekday mornings.
4. Mergers & Acquisitions
A large tech company acquires a smaller competitor with an innovative product after its share price suddenly falls by 70% in less than a month.
5. Operations
A fast food company in the UK quickly finds a domestic supplier of pre-made salads after its supply of potatoes for french fries is disrupted by a strike at ports on the North of Europe.
6. Innovation
A solar panel manufacturer discovers a revolutionary new technology that dramatically improves the conversion efficiency of solar cells. Such a dramatic improvement wasn't anticipated, so the company quickly prioritises significant resources to commercialising the technology.
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