The greatest ability to succeed in business is to see trends and capitalize on those trends before everyone else does. Those who can find openings in the market and put forward a successful strategy will beat the market while those who cannot muster this ability will be beaten by the market. When old strategies become ineffective it is necessary to do something new and put investors money in places that actually work.
Strategies are inevitably tied to people's egos. We spend a great deal of time trying to develop strategies and looking through our personal knowledge banks to assess a situation and formulate a plan. They become personal extensions of ourselves.
This is one reason why changing a strategy once it has been solidified is so hard. People become opposed to change because it could reflect poor judgement, a changed situation, or invalidation of one's experience.
Strong leaders have the ability to see the need for change and be reflective of their strategies. They are able to draw in the collective knowledge of their teams and in turn are able to incorporate new knowledge when it becomes available without threatening their fragile sense of self.
There are times when it become apparent that a strategy change is needed. A few of red flags could include the following:
-When your business is losing revenue/customers.
-When the political and regulatory environment changes.
-When your business isn't differentiated from everyone else.
-When your value propositions become weaker.
- When your business fails to capitalize on emerging markets.
-When expenses and cost structure becomes over burdensome.
-When old strategies lose the support of internal stakeholders.
-When competitors move into your market.
-When new knowledge and ideas are not incorporated into management decision-making.
-When customer complaints rise.
-When mistakes and errors rise.