Senior managers must be aware of the trends in order to manage the difficult economic times that businesses are currently facing. It’s easy to get distracted by the daily grind and not see the trends that are affecting your business. Management Methods surveyed over 125 senior managers from 19 states to identify the top trends and strategic issues that businesses should be aware of.
Strategy, Trends and Strategic Decisions that Must Be Taken Into Account
I. The best strategic decisions made in the last 3 years
1. Businesses benefit from a better planning process
2. Establishing a clear vision and direction
II. The 3 worst strategic decisions made in the last 3 years
1. Inadequately staffing for transitions
2. Do not “stay the course” when there are new products/development/direction
3. Setting clear goals and not following through
III. Top problems facing businesses today
1. Consolidations and mergers in different industry sectors
2. External forces, such as legal/regulatory issues
3. Offshore competition
4. Ability to get financing and maintain long-term banking relationships
IV. The most significant long term trends
1. Consolidation of industries
2. Offshore competition, particularly in the Chinese market
3. Long-term planning and strategies vs. short-term targets and expectations
4. The U.S. has a more difficult regulatory environment, which is leading to higher overall cost.
Analyse of the most significant long-term trends
Consolidations in the industry have been taking place and seem to be increasing as we deal with the 2008-2009 recession. Consolidations are causing massive changes in all areas, from banking and automotive to oil refining to gasoline distribution to making tape to healthcare, automotive suppliers to electronics, and other industries. This has led to more job instability and fear of job losses in the workplace. Leaders who are able to recognize these situations and work with customers and suppliers to maintain strong communication lines within their organization will be effective.
Nearly every American business is being affected by offshore competition today. This is true whether the company is competing in the marketplace or for raw materials and components. American Industry must be more competitive in order to remain competitive in an era of increasing competition and where there is no level playing field. Organizations must rethink their vision and develop visionary strategies as well as reality-driven operating plans. Execute the plan across the organization.
We will continue to live in a regulatory environment that is increasingly complex. What can we do for our businesses to make it more difficult? Ensure that there are processes in place for identifying all legal and other requirements that impact our businesses. Then, conduct planned compliance reviews. For immediate follow-up, report any non-compliances to our corrective actions systems. This will allow us to stay one step ahead of the curve and prevent any major compliance issues. This is required by ISO 14001:2004.
These trends can have a significant impact on your business. What should you do?
1. Recognize any weaknesses in your internal communications with customers and suppliers. Redouble your efforts to communicate effectively what is happening in your industry, and in particular your business. It should be done consistently and systematically. Communicate, communicate, and communicate!
2. Your senior management team should review your vision for the business. Is it in line with today’s reality? Your operational and strategic plans should be updated. A strategic plan is not a book. It’s a simple plan that guides your business on the path to becoming a low-cost, high-quality producer in your industry. Your plans should be executed!
3. The ISO 14001:2004 process, which addresses the current regulatory compliance issues, is an important link in environmental compliance. The OHSAS 18001 standard is also a good reference point for safety. These are highly recommended. Each business should have a system for compliance reviews and follow up.
Recognize long-term trends in your industry and take the necessary steps to position your company to succeed in today’s new era.