STRATEGY SESSIONS #6

SOME BASIC STRATEGIES

by Dr. Steve Payne

A strategy is simply a plan and a pathway from where a person is now toward certain goals that a person has for the future.

There are many kinds of strategies.  Some strategies are well known in business competition, in military battles or wars, and in games.  Perhaps the most famous historical account concerning strategy is the Art of War attributed to Sun Tzu , a high-ranking military general and strategist who lived around the fifth century BC.  He discussed issues such as the costs involved in successful military campaigns, the importance of alliances, the use of creativity and timing in attacks, the need for flexibility in responding to shifting circumstances, and evaluation of the intentions of competitors.

Among the most basic strategies are ones such as a thrust or a straight-forward and often bold attack at the heart of the opposition.   A feint or flanking strategy is one that appears to be at one target area when it’s actually designed to attack another target area that is perceived to be less well defended.  An encirclement strategy seeks to surround an enemy or target and cut off its supplies or retreat.  A gambit strategy is sacrificing in competition one or several of your resources to try to position yourself better to attack and gain more of an opponent’s resources.  One strategy can be a bluff in which an attack is threatened in hope the opponent will surrender certain resources without the costs of competition. If an opponent expects major retaliation from you for an attack, there’s a chance that he or she will not attack your position at all.   A playing possum and a poison pill strategy effectively lower the inducements for opponents to attack.  There are also competitive strategies, such as reverse engineering by which the resources or accomplishments of successful competitors are closely studied in order to learn these capabilities and be more competitive in applying these.

One business-related category of strategies involves whether the plan seeks its goals through offering capabilities at a lower cost than competitors who have a similar goal and are able to provide.  This is known as a cost leadership strategy. By contrast, the plan might seek its goals through differentiation of an individual’s capabilities as unique or different and, therefore, worthy of premium or higher pricing.  A focus strategy is one that aims at a particular and narrower market niche than some other competitors pursue.  The strategies mentioned here are just a few examples of many types of strategies that one might pursue.

In determining potential strategies, part of Step 2 in this strategic process, competitor analysis, is critical and involves two concerns or dimensions.  The first dimension is the extent to which others are pursuing somewhat similar markets and opportunities as you have identified and want to enter.  The second concern is the extent to which competitors for such markets have similar, better, or worse competitive resources and capabilities than you have. Competitor analysis takes into account 1) the awareness of others of those markets that you want to pursue, 2) their motivation actually to try to move into these markets, and 3) their relative abilities to be successful entrants into those markets.  Certain markets and opportunities really reward first or early movers into those markets, while other markets see first movers often faltering and late movers becoming successful as they adapt better to changing market conditions.  Competitive markets, and the opportunities within these, can be characterized in various ways, including whether these change slower or quicker than typical markets.

Some markets and opportunities may be open to many successful entrants or these markets could be so narrowly defined as to allow only a few successful entrants.  For example, nursing graduates from universities have long had a fairly large number and broad assortment of good employment opportunities due to an undersupply of well-educated and certified nurses.  Other employment markets can be difficult to enter and limited due to employee cutbacks or other reasons.  More difficult-to-enter employment markets and the more vexing life challenges demand more careful strategic analysis and decision making.