When the executives at Blockbuster decided to turn down Reed Hastings’ offer in early 2000 to sell Netflix for $50 million dollars (Netflix is worth $32 billion as of this writing), do you think this was a good idea? I mean, it’s easy to look back today at the value of both companies and suggest that Blockbuster (and Hastings for that matter) were out of their minds, but the decision at the time for Blockbuster was a wise one – as Netflix, still predominantly a DVD-by-mail company, was losing money.
Often what can appear to be the best ideas at the time, aren’t. Time will tell as to whether we’ve made the best decisions and choices in business, or whether we’ve made catastrophic errors in judgement. The only real way to ensure our ideas are effective is to formulate them in an environment in which we effectively consider opportunities against challenges. This is of course the premise of any good corporate strategy and when you consider the objectives you set a year or two for the company, the question is not how well are you progressing against targets, but how well did you do at the time in predicting your future?
I’ve said this before, but it bears repeating. The best strategies in today’s volatile economy, are those that are dynamic. A vision does not have to remain static for a decade; Objectives can change mid-course; Challenges can arise that were entirely unpredictable only twelve months ago. These are the norms in business today.
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As we approach a new year, consider the last time you reviewed not just the strategic objectives you set a year ago, but how accurate the predictions you made were, and in turn how effective your decisions have been. If you aren’t reviewing your strategy annually (at a minimum!), then you might as well abandon the entire process completely. The speed of and rate of change has evolved to the extent that stability and predictability are no longer the norms, but the exception.
So as you begin to prepare to make next year your most successful year yet, consider first how accurate your decisions were in this past year. Accuracy (or a lack there of) leaves clues as to how you can be more effective in your future decisions. Don’t miss this critical activity during your annual planning process.
If you’ve mastered the effectiveness of your decision-making process for formulating your strategy, the next step is to increase the speed at which you can achieve your strategy. Learn more by clicking here.
© Shawn Casemore 2015. All rights reserved.