Business Strategy/Failure of Strategy

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« Business Strategy
The Art, Science, and Craft of Decision-Making

Failure of Strategies
»
The Psychology of Business Management Limitations of Business Management

Reasons why strategic plans fail[edit]

There are many reasons why strategic plans fail, especially:

  • Failure to understand the customer
    • Why do they buy
    • Is there a real need for the product
    • inadequate or incorrect marketing research
    • customer looking for more advanced technology,user safety, aesthetic appearance
  • Inability to predict competitive|environmental reaction
    • What will competitors do
    • Does your product fulfill the aspirational needs of customer
    • company structure and style not lending to find out the possible reactions; its style has always been 'knee-jerk' reactions.
      • Fighting brand management|brands
    • product has crossed its half-life period; no further research done to revamp/add more attributes
    • Company has not taken a full view of the market demand ;supplies reaching only a few pockets.
      • Price wars
    • an attitude of complacence or a fear of market expecting a permanent crash in prices due to price war
    • Will government intervene
    • Whether any USP is envisaged vis-a-vis the existing models
  • Over-estimation of resource competence
    • Can the staff, equipment, and processes handle the new strategy
    • Failure to develop new employee and management skills
    • Does the organization know how to fit in new resources with old team
  • Failure to coordinate
    • Reporting and control relationships not adequate;company is bogged down by silos, internal politics
    • Organizational structure not flexible enough
    • Keeping the teams in darkness about their roles in the overall progress of the project
    • Teams not given the big picture
  • Failure to obtain senior management commitment
    • Failure to get management involved right from the start
    • Failure to obtain sufficient company resources to accomplish task
    • Failure give adequate briefing to senior management
    • Failure to be transparent with senior management team
  • Failure to obtain employee commitment
    • New strategy not well explained to employees
    • No incentives given to workers to embrace the new strategy
    • Failure to train the junior level operatives for the new project
    • Failure to involve employees before the start of project
    • Failure of senior planners to understand the nitty gritties at the operational level
  • Under-estimation of time requirements
    • No critical path analysis done
    • Senior and middle level managers not adequately exposed or trained to handle nitty gritties in execution
  • Failure to follow the plan
    • No follow through after initial planning
    • No tracking of progress against plan
    • No consequences for above
    • No proper training to give feed back at the critical junctures
  • Failure to manage change
    • Inadequate understanding of the internal resistance to change
    • Lack of vision on the relationships between processes, technology and organization
  • Poor communications
    • Insufficient information sharing among stakeholders
    • Exclusion of stakeholders and delegates
« Business Strategy
The Art, Science, and Craft of Decision-Making

Failure of Strategies
»
The Psychology of Business Management Limitations of Business Management