Blog: Dan E. Linstedt

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Competitive Decision Time Is Shrinking

We've all heard it, it's there. Most of us know it - yet we refuse to accept it. There are strange happenings within the strategic use of information across the organization. The REAL question going forward will be: what will the value of STRATEGIC data sets be to the organization in the future? The whole question invites the opposite thought process: Do a bunch of fast TACTICAL decisions today, define the STRATEGIC decision of tomorrow?

In this day and age executives and decision makers are finding less and less time to "decide" what to do strategically with the organization. Yet strategic decisions become more valuable when they are made in the RIGHT-TIME. Tactical decision making is on the rise, and in fact - is using "learned" information from a strategic base of data (patterns to create knowledge) to TEST their tactical decision.

Confused yet? Sorry. Here's an example:
15 years ago, if you told me that you had a decision for where the company needed to go (you had a strategic plan for the next 5 to 10 years) and that you used 20 years or 30 years of historical data and trends to reach that plan, I might have said: great - you seem like a solid company, and the plan looks good.

Today, if you tell me you have a strategic plan for the next 10 years, I might begin to question how agile your company is to changing market conditions. I might tell you your company may not be around in 5 years (unless the plan changes as you go along).

What does this mean?
It means a few things.
1. A decision maker has less and less time (overall) to make good decisions today than they did 5 years or 10 years ago.
2. Each decision applies to "less" time moving forward, particularly because the market conditions change so quickly
3. Larger and larger companies must become more adaptable and agile in order to compete with the leading edge companies - particularly once an idea has proved itself worthy, and is beginning to "cut a new market" out.
4. BETTER decisions made faster require ever increasing amount of background data (usually learned patterns from a result of data mining).
5. STATIC Strategic long-term plans are no good. GOALS on the other hand, and OBJECTIVES are wonderful - but need to be created in such a manner that the strategic plans are flexible, and can be "thrown out at a moments notice and replaced with new plans." This means sunk-cost for poor strategic decisions.
6. Competition is driving ever shorter "decision cycles", as long as we continue with increasing direct contact with the customer, and empowering the customer to make choices, there will be less and less "group think" and more and more "individualism", making it harder to "trend" and harder to predict why people do what they do.
7. Each decision is becoming more and more critical, not to mention more and more personalized. This is making it even harder to set and stick to a static strategic plan.

I'm not saying that all strategic plans are washed up, nor am I saying that strategic decision making is completely gone, nor will it ever completely go away. I am saying that the nature of strategic decision making is changing - to be more agile. The lines of what's tactical and what's strategic are changing and blurring together. I am saying that strategic and tactical decisions (if made incorrectly, or without enough learned background) cost more today than they did in the past. I am also suggesting that tactical decisions need to be made on the basis of data mining of all that history.

The notions of time are speeding up (see Ray Kurzweil, and The Age of Spiritual Machines). What I would like to know is: in your organization, or companies you've worked in (without mentioning names), what have you seen in regards to their ability to think Tactically vs Strategically? Do they have long term plans that guide them and are unchanging?

It no longer pays to be a dinosaur of giant proportions; it seems to pay better to be more like a body of water - fluid, dynamic, and possibly covering large areas of ground.

Cheers,
Dan L

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