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In a Lousy Economy You Need a Strategic Plan More Than Ever

Author: ; Published: Jul 26, 2010; Category: Strategic Planning; Tags: , ; No Comments»

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What once was an External Opportunity may no longer be so because of reduced consumer spending patterns or otherwise reduced demand. Businesses that do well in poor economic situations correctly identify opportunities. These opportunities may be more counter-intuitive than in rosier times. For example, take a look at the perceived needs of different market segments. These “needs” might be great chocolate, cosmetics, even some health care products. In tough times, needs often translate into products and services that make consumers feel better. You need to examine opportunities with precision. On one hand, an opportunity may be “basic”. On the other hand, it may seem extravagant. To many women, chocolate is a basic. To many men, it is an extravagance.

One or more of your competitors may now be an External Threat because they have adopted a price leadership strategy whereby they are undercutting your prices in the marketplace. The correct response in your new strategic plan may not be to match their low prices. Instead, you might want to emphasize the value of your products and services (market differentiation) or choose a niche strategy such as a hyper-focus on products or services for a particular market segment. As an example, a cosmetics product that has been targeted to a larger audience may be re-focused to a niche such as women over 50 who are active and have a strong focus on health. The product differentiation in this case could be redefined to zero in on the anti-aging benefits AND the product’s wearability and longevity during exercise.

Having established these strategies based on External Opportunities and Threats, you then need to assess your Internal Strengths and Internal Weaknesses so that you are able to respond to the new horizon of Opportunities and Threats that are presented by the current economic environment. Continuing with the cosmetics example: Does your marketing, advertising and product branding/packaging need to be re-tooled to emphasize the new focus on the active, health-conscious woman over 50?

The key to effective strategic planning in any economic environment is to regularly review your plan to make certain that it continues to work for your organization.

If you need help with your Strategic Plan, please contact us at info@strategicfutures.com. We have been around long enough (almost two decades) to have successfully facilitated strategic plans when the economic outlook was not so rosy. We have a successful track record working with businesses, nonprofit, association and public sector clients.

 

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