It Is Time to Re-Assess Your Strategic Assumptions
- Jun 24, 2021 4:38 pm GMT
Today’s business climate is exceptionally volatile and complex. In this type of uncertain environment, it is essential to reassess all of the strategic assumptions that have been the foundation of your planning efforts. We no longer have the luxury of being able to take for granted that shifting trends will be easy to see or that customer needs will be stable.
As so many external forces influence the on-going value of your enterprise, it has become more essential to challenge the assumptions you use for your strategic planning purposes. Going forward, success requires detailed scrutiny to determine how much risk you really face. This scrutiny will also help you to better anticipate the changing needs of your customers.
When assessing the assumptions that you use for your decision making, there are several critical flaws that you must avoid. These assumption flaws include internal beliefs based on incorrect information or errors in how the assumptions have been developed.
Most leaders believe that they already know the most critical assumptions that impact their organization. Typically, if you have been working in your industry for a long time, it is likely that you have a strong point of view about how things should be done and your own expectation of what your customers need.
Yet all too often, it becomes easy to get locked into a belief paradigm that causes you to stop paying attention to what is really happening in the evolving world around you. Customer expectations change. Budgets and priorities shift. Competitors make aggressive moves. Tactics that previously worked well are no longer getting the same response from your customers. If this sounds like your situation, then it is the time to reassess your assumptions.
Review Your Strategic Assumptions
Set aside time to fully re-assess all of the assumptions you use. This will help you develop strategies that leverage new opportunities offered by changing trends impacting your industry. It will also provide you with new insight to help you better anticipate the potential impact of these changes and others you may need to consider.
Stepping back to determine if the critical strategic assumptions you are using for your decision criteria will also afford you with an opportunity to identify changes that need to be made before these new or emerging trends will wreak havoc on your enterprise’s future financial stability or long-term viability.
The prism used for how you view the external world creates a bias in how you interpret the information you receive and how you perceive the potential impact of this information. As a result, it becomes easy to minimize the impact of changing external forces.
This is especially challenging when you are busy dealing with many the pressures of the responsibilities of your day job. It is easy to lose sight of the external environment around you. You assume that everything is staying the same or will be going back to normal. But yet, after coming through the intensity of a period of economic volatility, it is essential to consider the true impact of those market changes on your business or organization.
Make sure you have more than just a superficial understanding of the issues at hand. Review your strategic assumptions from outside your own paradigm of perspective so you better can navigate the complex variables impacting your customers and their decision-making processes. Ensuring that your team also has a comprehensive understanding of the potential impact of complex external forces that affect your enterprise will help them be better stewards of your organization’s future.
Gaining A Deeper Understanding
When you are operating in a complex economic environment, a deeper understanding is required of the complexity of issues that affect your decision making. Re-assessing your assumptions encourages you to ask the hard questions about the market forces influencing your enterprise. It also reexamines your assumptions about your customers in terms of both their decision criteria and what triggers their purchasing behavior.
Reviewing your assumptions also ensures that the most critical questions about your future are discussed well in advance of them impacting your bottom line. This requires your ability to realistically assess the influence of how these other factors impact your situation. This effort provides opportunities to deepen your value to your current and prospective customers.
It is imperative to consider how the assumptions you are currently using may be distorting your situation and undermining your ability to make better long-range decisions. Re-evaluating your assumptions with an objective perspective will help you identify the shifts you need to make and in turn, the insight you need to obtain to move your decision making forward in the most effective manner.
Developing Better Assumptions
Good assumptions are based on accurate information and this information needs to be continually updated. The most critical factor that determines how rapidly you can get clarity is grounded in the quality of the assumptions that you use to evaluate your decision options.
We must become even more observant to stay on top of evolving trends. Those shifts and changes can fundamentally alter the viability of our assumptions. As a result, we need to continually update our understanding of what is impacting the decisions we make.
Good business decision makers are always willing to assess how changing assumptions can benefit their bottom line or create new revenue streams. You have to monitor data to shake out the evolving changes that are not obvious on a macro view. This takes discipline and effort.
Reassessing your assumptions about the future will make you a better strategic thinker and give you deeper insight into how your marketplace needs are likely to change. Encourage your trusted advisors and key employees to help you challenge the assumptions you currently use in your organization for decision-making. Be on the lookout for emerging trends and how they may affect your enterprise. Those emerging concerns or challenges that are on the horizon might affect your decision-making approaches. It is always safe to assume that something is going to change.
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