The year 2020 has shown that market requirements can change in a matter of days. How to reflect these changes in the development strategy of a company? Is it actually needed or can a choice be made in favour of adaptability? These questions were discussed by managers and Russian companies' owners within an online meeting of МВА Alumni Expertise Club of the Graduate School of Management of St. Petersburg State University (GSOM SPbU).
The online meeting was held within Alumni Expertise Club for graduates and МВА/ЕМВА listeners on the topic: Strategy and success of a company: myths and reality.
Invited experts and business practitioners discussed questions related to the development of strategies of companies: what should be a planning horizon, can we talk about sustainable competitive advantages nowadays and how to strike a balance between planning and business adaptability.
The period of strategic planning and revising strategies of the companies depends on the scope of their activities. Therefore, a planning horizon for Helix Laboratory Service — one year, Tele2 — five years. Whether to formalize a strategy in the form of a document or not — also depends on the size of a company and form of management.
«Strategy in small and medium-sized companies is the influence of owners, their views and even their life cycle on the operation of a company. In this case, it can be formulated verbally. Speaking of large companies, a clearly spelled out document is necessary. Strategy, as I understand it, is a method of reaction to events, which suits a particular company», — pointed out Director of Strategy GC «Galaktika» Oleg Du.
Way of managing a company influences an approach to planning. In small and medium-sized businesses team members at various levels frequently can suggest changes, while in large organizations all decisions are made by senior management. «In Helix, despite the already large size of the company, we are trying to sustain the spirit of a startup. We develop a strategy for a year and revise it once a quarter. Any team member can suggest changes during weekly meetings. By the way, last spring we conducted such meetings every day and changed our plan of action many times», — shared Deputy General Director Helix Laboratory Service and ЕМВА 2016 graduate Darya Goryakina.
In the opinion of a listener of ЕМВА 2020 programme, Head of the Commercial Operations Department, Т2 Mobile Pavel Chunihin, in contrast, even in a constantly changing world, there is no need to often revise a strategy: «If key success factors and achievements of indicators do not change, then there is no need to change anything».
What was a competitive advantage yesterday, will not be a competitive advantage today and can stop being it tomorrow. How such changes are reflected in a strategy? «For many years Tele2 company was a discount company. We had low prices, low investment in development and infrastructure. Now, we position ourselves in the market as an operator of quality services at affordable prices, we have changed communication, product, we have adjusted the company structure. It appears that a change of a source of competitive advantage required a complete change in the company's work», — shared Pavel Chunihin.
How to anticipate competitive advantages of a company and reflect them in a strategy? In the view of The Director General of IGooods Grigory Kunis, everything depends heavily on an industry. If to outsrip a little bit a stage of market development, then at some point you can beneficially attract investors' money or completely exit a market in time.
In the choice between adaptability and planning, the participants in discussion agreed that a strategy itself should contain adaptive elements. One of them is technology deployment and development. «The more flexible we are, the faster we respond to market changes. The formula of our speed is investment in technologies», — said Daria Goryakina.
«Strategy is a guiding star, which managers can draw on. Yet, it is important to sustain adaptability in a company, speed in our market is almost the most important thing. The free flow of information, convenient means of communication inside a company by which any employee can propose initiatives — all of this helps react quickly on market changes», — added Grigory Kunis.
The meetings of GSOM Alumni Expertise Club are organized by GSOM SPbU Alumni Relation Department. The participants of online events are listeners and alumni of MBA and EMBA programm, representatives of large Russian and foreign companies. The aim of such meetings is an exchange of experience and a search for new solutions.