AS BUSINESSES approach the opening of the Asean Economic Community in 2015, concern over their competitiveness under the new market environment is inevitable. Higher competition can be expected from foreign companies coming into Thailand as well as Thai companies going out to seek new opportunities overseas.
It is recommended that each company review and prepare itself and be ready to move forward in a more strategic manner. The question is - what kind of strategic thinking can be adopted to help businesses better deal with the new challenge?
In the traditional way of business management, most companies seem to start from looking at the issues or problems being encountered. Then management would try to analyse the problems using existing tools to uncover the root causes in the hope that fixing them could lead to business success. Unfortunately, in many cases, most of the companies' resources have been allocated to focus on fixing existing problems rather than on what they can do best.
Another approach worth considering is enhancing strength more and more until some of the existing problems become less important to the company. Thus the concept of "building on strength" can be an alternative approach in developing the company's strategy. The following are steps that can be considered for proper practice and application.
Asking the question: "What are we doing best?" For those companies that have been in business for a long time, there must be something they are good at. Surprisingly, it is possible that some employees may not even know what they can do better than others. The areas of strength can be product quality, strong brand image, process efficiency and so on. Try identifying these qualifications.
Thinking of how these strengths can be used to shift the company to the next level of success. Discussion and brainstorming sessions among the management team can lead to creative and practical ideas either in a short-term or long-term perspective. Differentiation and diversification of the business can be considered as the starting point. At the end, the team should come up with a shortlist of things that could be done.
Developing an action plan. It is important to come up with an effective action plan that can be implemented successfully. It would be a waste of time if management could not make a decision on which way to go based on the existing capabilities.
Typically the action plan should include the timeline, actions to be taken, and responsible persons as the minimum.
Monitoring and updating. With the support and coordination of all parties concerned, management needs to ensure there is a proper process of follow-up on the progress and status of the projects.
Regular reviews and updates are crucial to ensure the company can turn the plan into reality.
n the normal business cycle, existing problems still have to be tackled. But paying more attention to the company's core competency can be a way to achieve the success in a more positive and enjoyable manner. An example of a strength-based strategy of a production facility is as follows.
A small factory is trying to develop a long-term strategy to prepare for the increased competition in the near future.
The existing problem is that the company cannot compete with the new players in the same industry who can offer lower prices to customers through mass production.
Unless the company does something new and different now, it might not be able to survive in the longer term.
After a few serious management meetings, the company decides to concentrate on leveraging the strength of producing quality products with high reliability and a low rate of defects and on-time delivery. As a result, the company would focus more on producing premium products for customers who can afford higher prices and high quality standards.
This initiative has opened up an opportunity for the company to develop a number of new products that can attract new target groups in the future.
This is just one example of how a "building on strength" mindset can be applied.
Yanyong Thammatucharee, senior vice president for accounting and finance at Central Marketing Group.
AS BUSINESSES approach the opening of the Asean Economic Community in 2015, concern over their competitiveness under the new market environment is inevitable. Higher competition can be expected from foreign companies coming into Thailand as well as Thai companies going out to seek new opportunities overseas.
It is recommended that each company review and prepare itself and be ready to move forward in a more strategic manner. The question is - what kind of strategic thinking can be adopted to help businesses better deal with the new challenge?
In the traditional way of business management, most companies seem to start from looking at the issues or problems being encountered. Then management would try to analyse the problems using existing tools to uncover the root causes in the hope that fixing them could lead to business success. Unfortunately, in many cases, most of the companies' resources have been allocated to focus on fixing existing problems rather than on what they can do best.
Another approach worth considering is enhancing strength more and more until some of the existing problems become less important to the company. Thus the concept of "building on strength" can be an alternative approach in developing the company's strategy. The following are steps that can be considered for proper practice and application.
Asking the question: "What are we doing best?" For those companies that have been in business for a long time, there must be something they are good at. Surprisingly, it is possible that some employees may not even know what they can do better than others. The areas of strength can be product quality, strong brand image, process efficiency and so on. Try identifying these qualifications.
Thinking of how these strengths can be used to shift the company to the next level of success. Discussion and brainstorming sessions among the management team can lead to creative and practical ideas either in a short-term or long-term perspective. Differentiation and diversification of the business can be considered as the starting point. At the end, the team should come up with a shortlist of things that could be done.
Developing an action plan. It is important to come up with an effective action plan that can be implemented successfully. It would be a waste of time if management could not make a decision on which way to go based on the existing capabilities.
Typically the action plan should include the timeline, actions to be taken, and responsible persons as the minimum.
Monitoring and updating. With the support and coordination of all parties concerned, management needs to ensure there is a proper process of follow-up on the progress and status of the projects.
Regular reviews and updates are crucial to ensure the company can turn the plan into reality.
n the normal business cycle, existing problems still have to be tackled. But paying more attention to the company's core competency can be a way to achieve the success in a more positive and enjoyable manner. An example of a strength-based strategy of a production facility is as follows.
A small factory is trying to develop a long-term strategy to prepare for the increased competition in the near future.
The existing problem is that the company cannot compete with the new players in the same industry who can offer lower prices to customers through mass production.
Unless the company does something new and different now, it might not be able to survive in the longer term.
After a few serious management meetings, the company decides to concentrate on leveraging the strength of producing quality products with high reliability and a low rate of defects and on-time delivery. As a result, the company would focus more on producing premium products for customers who can afford higher prices and high quality standards.
This initiative has opened up an opportunity for the company to develop a number of new products that can attract new target groups in the future.
This is just one example of how a "building on strength" mindset can be applied.
Yanyong Thammatucharee, senior vice president for accounting and finance at Central Marketing Group.
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