Business and Market Planning Principles - Essay Example

Business and Market Planning Principles Name Date Organisations utilise different means in ensuring that they succeed in their endeavours. However, this is only successful if the appropriate strategy is used in ensuring that measures are in place that will guarantee success. Strategies are usually guided by ideologies, philosophies and principles and some common strategies that are employed are planned and emergent approaches but both depend on specific situations. Planned strategy do not factor change in there planning and usually there strategies are developed for a longer period providing only minimal space for changes (Stamm 100). On the other hand, emergent strategic approach appreciates change and usually the approach or strategies that are developed involve linking them with changes that occur in daily situations. However, there are other unique strategic styles such as game theory and competing on the edge strategy that provides managers and marketers with means of ensuring that they formulate and implement appropriate measures in ensuring their businesses succeeds. Thus, the aim of this paper to analyse game theory and competing on the edge strategy in determining their effectiveness if both are intertwined and used by marketers to formulate their strategies. Strategic approaches differ depending on the approach that the managers and organisation utilise in ensuring that the organisation embrace a strategy that will ensure that the organisation is successful and concurs with their vision and mission requirements (Stamm 99). Generally, the fundamental of a business is a game in that sometimes there is competing and other times there is cooperation between the players resulting into a terminology called “co-opetition”. Cooperation is expansion of business pie while competition is reduction of the business pie. Both competition and cooperation are important characteristics and desirable aspects of any business enterprise. Thus, “co-opetition” tries to look for ways to change and expand the organisation and devising new and better strategies to compete. Brandenburger and Nalebuff brings into consideration the aspect of ‘value net’ in which it indicates that a business operates in an environment that is constituted by four elements: these elements are customers, suppliers, complements and competitors (Rindfleisch 80). Customers and suppliers directly influence the production process while competitors influence the environment in which the business is located and operating. According to Brandenburger and Nalebuff, the overlooked players are the ‘complements’; complements are those organisations and institutions that exists a relationship that is reciprocal and mutually advantageous. Good examples of organisations that complement with each other are the hardware and software in the computer industry. Both these two-computer industry components co-exists in that hardware sector will not operate without the software sector. Thus, a complement is a product that makes another product more attractive (Rindfleisch 79). Controlling the complements is the added value; it is the incremental benefit that the organisation brings to the game (situation) and the added value can be defined as the size of the pie when the organisation is in a given situation minus the pie when the organisation is out of the game. It results in Brandenburger and Nalebuff introducing acronym PARTS in that P stands for players, A stands for added value, T stands for tactics while S stands for the scope of the business (Colman 215). In any organisation, the organisation is usually characterised by unpredictable and high velocity change. Change is inherent and it can come in terms of technologies, customers, collaborators, suppliers, competitors and political conditions that are constantly shaping many industries. Thus, the fundamental goal of strategy is to provide means to manage this change. One of the major strategy is competing on the edge, however, it is uncontrolled, unpredictable and at times is inefficient but other times is effective in those industries that are impacted by relentless change. This means that competing on the edge basically deals with responsively reacting to change, being prepared for change and determining or dictating pace of change that other players are supposed to follow. Competing on the edge is associated with constant change and not only in corporate realignments but in unrelenting, daily adjustments to a constantly shifting landscape. A question may be asked – what are the benefits associated with competing on the edge? Like any other game, winning is about survival but for the best organisations or businesses winning is a chance to seize the initiative, dominance of an industry and thus constant change. Like any other strategic approach, there are two parts in strategy, which are “where” and “how” and this are rooted in the logics of the nature of speed, complexity thinking and time paced evolution. According to Brown and Eisenhardt, five building blocks that is further grouped into three groups that constitute competing on the edge strategy (Brown and Eisenhardt 23). These three groups are edge of chaos (compete in today’s business) that brings into consideration improvisation regarding real time communication and structures, and the other part within this first group is capturing cross-business synergies that is commonly referred to as co-adaptation that brings into consideration unique roles, focus and nexus of strategy and tactics. From the three groups, the second part brings in the edge of time (evolve to tomorrow’s business) including regeneration, which includes modularity and natural selection associated with gaining advantages of the past while in the same group is experimentation (winning tomorrow today) in which options and learning are factored. The last third group is time pacing (establish the pace of change) in which the time pacing brings into consideration transition and rhythm (Brown and Eisenhardt 23). These factors define and shape the way that business is accomplished. Generally, it cane be summarised that competing on the edge strategy provides means for ensuring that change is embraced. Managers who employ competing on the edge strategy understand that advantage for any business are temporary and thus they require to focus on continuously generating new areas where they can get advantage and to ensure that they never lose sight in that today’s winning strategies may not be successful for tomorrow requirements. This means that those managers who utilise competing on the edge usually see change as an opportunity and not a threat (Brown and Eisenhardt 23). Moreover, those managers and marketers who understand that strategy is emergent, diverse and complicated appreciate the use of competing on the edge strategy since it accomplishes the fundamentals of formulating and implementing a winning strategy. Strategy is usually diverse collection of different moves that are loosely related and thus should be brought together to provide a semi-coherent direction. Marketers who utilise the compete on the edge strategy utilise strategy as emergent in making a variety of moves, analysing what happens, and making follow ups of these works. This results in playing a broader and move surprising strategic approaches than other players within their environment. Additionally, on the edge marketers and managers scan for opportunities to re-invent their business and then let the revenues follow (Verburg and Roland 10). This means that creating value takes priority than improving efficiency at the time that profit juggernauts are rare finds and thus continual reinvention is a crucial approach that results in long-term profitability. Thus, understanding the fundamentals that constitute competing on the edge strategy provides means in which the managers and marketers will utilise in formulating and implementing strategies that balances with the requirements of the environment. Its effectiveness can be equates to the game theory. Game theory is based or operates in terms of games. This means that the underlying causes and players within the game can be manipulate resulting in scenario that is advantageous to the organisation. The aim of any marketing agent is to ensure that the organisation improves on the market share and increase on revenue and thus is able to change the setting of the environment, which can be equated to a game (Colman 215). The players who can be termed as the competitions determine the direction of the game. Marketers who utilise the game theory understand that cooperation is important to ensure that their own marketing strategies succeed. Even though, there is business rivalry between the competitors, it is important to include the competitors through cooperation to ensure that their share the profit pie. One product may complete the other and this means that these two products should work together to ensure that there products improve in terms of revenues and profits. For example, in the computer industry, the software parts complements the hardware and vice verse, and there is no way that one of them can operate without the assistance with the other. This means that the marketers of the software industry can cooperate with the manufactures of hardware in ensuring that their products performs well within the market segments stipulated (Verburg and Roland 10). Each marketer usually looks for strategy that is effective in his or her sector. Many theories and frameworks are in the literature that tries to explore on the different types of strategies that can fulfil the requirements of specific institutions. Some of the most common and effective strategies are the game theory and competing on the edge strategy. Game theory brings together competitors into cooperating in ensuring that a strategy or business approach is formulated that suits their interests (Colman 216) while the competing on the edge strategy provides managers and marketers with an opportunity of analysing change, and determining the appropriate time that old strategies should be left and new strategies embraced. Even though, the two approaches of decision-making are different, there differences and unique but there aim is to ensure that they provide means of formulating an appropriate strategy. Thus, for a marketer who wants to utilise both the styles should understand the difference that the strategies provides, and balancing between the strengths of each strategy in developing a new framework that will allow appropriate formulation and implementation of strategies resulting in improvement of organisations vision and mission requirements. Generally, theories and frameworks are the major components that are used in understanding the way the world operates. Numerous theories and frameworks exist depending on there requirements but in the strategic cycles the most common approaches are the emergent and planned. However, within these two approaches there are game theory and competing on the edge theory. Game theory champions bringing together competitors into cooperating resulting into a scenario called ‘co-opetition’. This is because there are products that complement each other and thus these organisations within this industry should come together to ensure that their business are successful through co-operation. On the other hand, competing on the edge presents five buildings blocks, which provide an opportunity for the organisation to formulate strategies that balances with the changing business environment. Marketers should being together these unique differences and benefits in developing a framework or model that will ensure that their businesses complements and at the same time; their strategies are based on changing business environment. References Brown, Shona and Kathleen Eisenhardt. Competing on the Edge: Strategy as Structured Chaos. Chicago: Harvard Business Press, 1998. Colman, Andrew. Game Theory and its Applications in the Social and Biological Sciences, 2nd Ed. London: Routledge Publishers, 1995. Rindfleisch, Aric. “Co-opetition: by Adam M. Brandenburger and Barry J. Nalebuff New York, currency.” International Journal of Research in Marketing 15.1 (1998): 79-81 Stamm, Bettina. Managing Innovation, Design and Creativity, 2nd Ed. New York: Wiley Publishers, 2008. Verburg, Robert and Ortt Roland. Managing Technology and Innovation: an Introduction. London: Taylor & Francis Publishers, 2005. Read More