Bulletproof Strategy..!!

“Strategic management” is formed by the combination of two words, ‘strategy’ and ‘management’. These two words holds relevant importance in today’s competitive world, where every other company is trying to acquire maximum market share in the respective industry.

These two words enables the company to take competitive advantage by formulating unique strategy and having proper management to execute that strategy.

These two words are not of recent origin and their use is not only limited to the corporate world, but the origin of these words dates back to ancient times of fighters like Hercules, Alexander and Sun Tzu. Strategy has been used in each and every battle and war fought in ancient, medieval and modern history of the world and will be continued to be used in future wars also. Strategy is the set of steps adopted by one party to gain advantage over other party in a war. The strategy was formulated with the help of tactics which were adopted for battles.

The guidelines for formulating unique and positive result oriented strategy were laid down by the outcomes of the famous battles and wars and through the works done by kings and war leaders of various wars in the course of world history.

Such one example is of the work done by Chinese war general Sun-Tzu in his book named as “The Art of War”. This book contains the strategies which were adopted by him in every war he fought, which gave him success throughout his life.

Unlike history, the strategy has found its importance in corporate world more than in any other field, where today’s competitive world is considered as a continuous battle and war state between the companies, where company having best strategic management survives.

But how to say that which strategy will work in which circumstance and for what time period and whether the formulated strategy will work in all situations or not. Before finding answers to these questions, we should understand how strategy or competitive advantage can be developed.

There are many areas where a company can develop competitive advantage, but the most important and reliable area is of technology.

“Technology is defined as the set of process which results in adding value in consistency”. Technology is considered to be the backbone of most of the industries, which is continuously evolving and developing.

With such a rapid change in technology, companies which are able to move with the change are able survive, others just fade away with the time.

The greatest example of this is the case of Kodak, which was leader in the technology of traditional film photography, but after the entry of digital photography by Sony, they could not catch up the changed technology and soon wiped away from the market.

On the other hand, taking example of Samsung, which moved the world by going with the new android technology in mobile phones. It became the leader in the mobile phone industry out of no-where, forcing market leaders like Nokia to innovate and change their technology.

The technology can be broadly classified as the hard technology and the soft technology, where both the streams of technology leads to complete technology up gradation in any industry. On one hand, hard technology deals with the sciences like physics, chemistry, biology, electronics and others, the soft technology deals with the basic areas of management and functional areas of a company. Dividing functional areas of a company in smaller areas of marketing, finance, human resource and operations can be helpful initially for a company, but on a long run, will lead to problems in coordination and conflicts of interest.

For a company which is trying to bring out technological changes in the system, only working on hard technology which not suffice as soft technology is equally important for the successful implementation.

Again taking the example of Kodak, after entry of Sony in the area of digital photography, company invested heavily on research and development of the digital technology and came up with a good technology which had the potential to help company retail its market position. But the problem was with the middle level management, which was change resistant and as result, company did not launched the technology and lost all it had. Thus the soft technology also plays a very important role in designing the strategy for a company.

Digging further into technology, every technology adoption has some stages, which determines the level of competitive advantage a company has. The first stage or the beginning stage is of familiarity, where the company just adopted the technology and is getting familiar with it. The next stage is of competence where company achieves competence in the technology and can utilize the technology efficiently. The third and the last stage is of competitiveness, which enables a company to compete with the other companies on the bases of strong hold of technology.

Taking the example of Toyota, which is famous worldwide for its lean production technology, evolved the technology and once was beginner in that technology. As time elapsed, it acquired competence in that technology and by this time other companies also realized the importance of this technology and they started adopting it. Today Toyota is the master in this technology and it has achieved competitiveness in it which has helped it to become the largest automobile manufacturer in the world.

But is simply changing to new technology enough for the success? The answer is no. The technology is the driving force for the industry and the companies, and simply changing technology cannot guarantee the competitive advantage.

The competitive advantage is achieved by efficient utilization of available resources with the help of smart management. Thus the combination of the three factors of resources, utilization and management creates the bulletproof strategy for a company.

But can we formulate the general guidelines for the companies to follow in order to achieve everlasting competitive advantage? Again the answer is no. The strategy is dynamic and customized. Neither it can be generalized nor timed. No one know the time duration a particular strategy will work for and also the situations it will work in.

The need of the hour is maximizing convenience, maximizing choice with a lesser price and to achieve this, prudent decisions have to be made at each and every step and level in a company.

How to formulate an everlasting bulletproof strategy is yet to be discovered.