Business

Four Steps to Create a Strategy in an Uncertain Environment.

Published

3 years ago

June 4, 2022

We live in uncertain times, it is obvious. The Covid-19 pandemic and the conflict in Ukraine have all caused unprecedented disruptions over the last few years. And the chaos is not likely to end soon. Companies face many challenges, and it is nearly impossible to plan for their future. This volatile environment demands a new strategy.

Is it worth trying to predict what is unpredictable? Uncertainty can be a source of risk but also opportunity. If handled correctly, uncertainty can allow organizations to expand beyond their existing business and possibly in unexpected directions.

These magic words are “handled correctly.” To transform a world full of uncertainty into one of possibility takes a shift in perspective and a different mindset from business leaders. Companies need a new approach to strategy development. It involves looking beyond what the company can do and imagining what it can do. Then, doing what is necessary to make it possible, even if it means going against established patterns and assumptions.

Strategy Rethink:

It is crucial to have a clear customer view when designing a strategy. What do your clients want? Instead of creating endless customer profiles, companies need to consider each client’s wants. This is the “job to do,” as Taddy Hall and Karen Dillon stated.
It is equally important to involve the whole organization in strategy development. This is not a task that a single corporate strategy team can do. Companies should instead draw upon the flexibility of an adaptable company to generate ideas and find solutions. It is essential to have the right skills at the right places within an organization. However, interactions between people are more important than individuals.
The process of revising and developing strategy should continue. The outcome you desire to achieve is what military strategists refer to as the commander’s intent. After that, the system should be continuously revised and adjusted. The goal of an army context may be to conquer a hill. However, the strategy for reaching that goal is fluid. For example, the process is not to cross the bridge and take the mountain. The bridge may be gone by the time you reach it. Your path to achieving your goal must change to reflect the realities of the ground. In the same way, businesses should not set their goals in advance but define them. Instead, they should draw on the knowledge they have gained along the way and the collective genius of the company.

Companies can thrive in a rapidly changing, fast-paced, and increasingly global marketplace by using this new strategy. Based on my experience in supporting companies, I recommend a four-step approach.

1. Find the big question.

First, you need to ask the right question. This is the question your strategy will attempt to answer. Jerry Porras and Jim Collins talk about big hairy, audacious goals. I enjoy thinking about big fuzzy, bold questions.

Your business should have a vision that expands its value, and that is the big question. It’s not only permissible but encouraged to dream. Customers’ problems and wishes are a crucial source of inspiration. These desires change all the time. Instead of predicting what customers want, it is better to ask them about their problems and frustrations and then work tirelessly to solve those problems. For new ideas, you can also ask your employees, investors, local governments, communities, and, naturally, your employees.

Sometimes the ideas you are looking for may already exist, but it is possible to dismiss them as too far from current operations. Recently, I led a consulting project with a large international airline. For years, they had known that customer demand was more fluid and volatile than it used to be. Due to the limited flexibility that major airlines have, the industry’s flights are generally scheduled with only two fixed schedules per year. Instead of finding a solution to the problem, such as offering one or two more flight schedules per year, we asked the radical question: “How do we offer flights on demand wherever and whenever a customer wishes to fly?”

On-demand flights were not a new idea. It had been discussed on several occasions previously but was dismissed because it was too far from the company’s core business and existing capabilities. The airline is known for regular flights on fixed schedules, just like any other major airline. Many people knew that on-demand flights could create new value. The question of how to make it happen was too complex, too complicated, and too bold for the current mindset of the airline.

2. Reduce it.

Next, you can break down the strategic question into more minor questions that relate to different aspects of your business or operations. This will allow you to anchor your strategy-devising efforts within the company. This also allows you to draw inspiration from outside of your industry. These brainstorming exercises, such as the one described by Hal Gregersen, can be beneficial. The emphasis here is on asking new questions and not searching for answers.

We ran the big question through various functional teams of the company to find out what they thought. This included crew scheduling, network management, crew scheduling, etc. They often replied to our suggestion of on-demand flights with “No way!” We asked them why. We were surprised to learn that they told us the details of what an airline needed to do to make it possible.

Do you see the trick? Instead of trying to win teams over, ask them why they don’t believe it is possible. It’s easier for people to answer this question, and often they have other ideas that you didn’t know about. Even better, it’s fun to take an idea everyone believes is absurd and go for it. This is how creativity comes alive.

This exercise resulted in a collection of sub-questions grouped into subject areas. One sub-question that came out of the discussion about on-demand flights was: How can we spot patterns in demand for flights and adjust capacity and prices accordingly? To put it another way, how can the company move the various activities related to yield management — without the which on-demand flight would not be possible from a business perspective — up to the next level.

3. Get creative.

Next, you will need to answer each sub-question. Then you can start brainstorming ideas and strategizing. You no longer need to think about the sub-questions, adjust them or ask questions if they are missing. Instead, you look for strategic ideas. Inspiration can come from both within and outside the organization. Look at top performers in your industry.

This was especially useful when working with an airline. No external examples were available for the strategic question of offering on-demand flight services. This was because none of the competitors provided such a service. We found many instances when we examined the sub-questions. Many young companies were able to forecast customer demand and adjust prices accordingly for other transportation modes, like buses, in yield management. Inspiration also came from different industries. Today’s fashion industry is fast-paced and renews its collections 12 times per year. This contrasts with the regular spring/summer/fall/winter schedules that were once the norm (like those used by the airline industry).

4. Find the best option.

Finally, determine which of the strategic options presented in the previous step is most effective in addressing each sub-question. We recommend that you first decide what success looks like for your process, then compare the new solution to the current one. Once the alternative solution is superior to the current one, you can abandon the old method. This should be done not only once but every time the market changes.

Your strategy can suffer if you continue to challenge existing solutions. Ask yourself these questions about each step: Does this contribute to our true value proposition?” Are we able to do this? This is the point: You should only do those things that you can answer both questions. You can either outsource or acquire everything else or start your own business.

The sub-question about improving the airline’s yield management was answered by realizing that the company could significantly enhance this area by working closely with a retail travel startup with exceptional capabilities in forecasting demand and anticipating how airlines would respond to pricing and capacity. In reality, the startup was a competitor to the airline in selling airline tickets. Therefore, the best strategic option was to buy a portion of the startup and outsource some of its yield management for on-demand flights. The airline eventually delegated several yield management-related activities and a wide range of exciting developments based upon artificial intelligence (AI) to its new partner.

Take a look at the skies.

Companies often get too focused on their capabilities when developing strategies. They focus too much on what they do well and could do better. We encourage companies to look up, be creative, and explore even the most absurd ideas. You might be surprised at how profitable a statement that you thought was impossible or too expensive suddenly becomes feasible.

Business

Post-Purchase Customer Experience – Why It’s the Key to Retention and Loyalty

Published

4 months ago

February 6, 2025

Tina Gondolin

In today’s fiercely competitive marketplace, securing a sale is just the beginning of the customer journey, not the end. Post-purchase customer experience has emerged as a pivotal aspect of not only retaining clients but also building unwavering loyalty.

Once the transaction is completed, a new chapter unfolds—one that can either transform a one-time buyer into a lifelong advocate or reduce them to just another statistic in the sea of disengaged consumers. Every interaction a customer has after the purchase, from personalized follow-ups to seamless customer support, plays a crucial role in shaping their perception of your brand.

As the dust settles on their initial decision to buy, it’s the ongoing experiences that will ultimately determine whether they return for more or drift away into the clutches of competitors. Understanding and optimizing this journey is not merely an option anymore; it’s a necessity for businesses striving to cultivate lasting relationships in a world where choices abound.

The Path to Loyalty: How Post-Purchase Experience Shapes Customer Relationships

Source: reverselogix.com

The journey to fostering customer loyalty begins long after the initial purchase is made; it is intricately woven into the fabric of the post-purchase experience. Picture this: a customer who eagerly anticipates their delivery, receiving a thoughtful follow-up email that not only confirms shipment but also includes tips for maximizing the product’s use—this simple gesture cultivates a sense of connection.

Afterward, a timely survey asking for feedback demonstrates that their voice matters, transforming a transactional relationship into a dialogue. Each element, from personalized recommendations based on their purchase history to dedicated customer support, deepens trust and enhances the emotional bond.

In this ever-competitive landscape, understanding that retention hinges not on the initial sale, but on the entire journey afterwards, can unlock the secret to creating lifelong advocates for your brand.

Beyond the Sale: The Critical Role of Aftercare in Customer Retention

Source: globalresponse.com

In the whirlwind of commerce, where transactions often take center stage, one critical aspect frequently slips through the cracks: aftercare. This pivotal phase begins the moment a customer clicks “confirm” on their order, extending well beyond the point of sale.

It’s not merely a follow-up; it’s a commitment to nurturing the relationship, a chance to reinforce the connection established during their buying journey. Think of aftercare as the secret sauce of customer loyalty—personalized messages, helpful tips, and timely support can transform an ordinary experience into an extraordinary one.

Customers who feel valued and supported are more likely to return, not just for the products they cherish but for the community and service that accompany them. In a landscape flooded with choices, businesses that prioritize aftercare don’t just sell products; they cultivate loyalty, turning one-time buyers into lifelong advocates.

Conclusion

Source: youngurbanproject.com

In conclusion, the post-purchase customer experience is a critical pillar in fostering retention and loyalty among consumers. By understanding and enhancing this stage of the customer journey, businesses can build lasting relationships that go beyond a single transaction.

Effective post-purchase marketing not only reinforces the value of the initial purchase but also encourages repeat business through personalized communication and ongoing engagement. As companies strive to differentiate themselves in a competitive landscape, prioritizing the post-purchase experience will prove essential in transforming customers into brand advocates, ultimately driving sustainable growth and long-term success.

Business

From Trader to Business Owner – How to Build Your Own Trading Firm

Published

5 months ago

January 3, 2025

Tina Gondolin

Transitioning from a trader to a business owner is a thrilling journey, a leap from the exhilarating chaos of the markets into the strategic realm of entrepreneurship. Many traders, fueled by their passion for the financial world, dream of establishing their trading firm—a bold move that promises both independence and potential prosperity.

Yet, this path is strewn with challenges, requiring not just deep market knowledge but also formidable skills in management, finance, and strategic planning. How do you go from analyzing charts and executing trades to overseeing a team of traders and making critical business decisions? In this article, we’ll explore the multifaceted process of building your trading firm, offering insights on everything from legal considerations to cultivating a strong company culture.

Prepare to navigate the nuances of this transition—where the fierce nature of trading meets the intricate art of business ownership. Your journey begins now.

Identifying Your Niche in the Trading Market

Source: udemy.com

Identifying your niche in the trading market is an essential first step on your journey from trader to business owner. Start by reflecting on what truly captivates you—whether it’s forex, stocks, options, or commodities—and the unique strategies you’ve developed through experience.

Tools like depth of market software can play a pivotal role during this process, offering detailed insights into market trends and liquidity levels, which can help you pinpoint areas of opportunity. Dive deep into market trends, analyzing which segments show potential for growth and profitability, while also considering the competition.

Don’t shy away from experimenting; this phase often involves trial and error, as you test different trading styles against varying market conditions. Additionally, leverage your existing knowledge to carve out a specialized area, perhaps focusing on a demographic or asset class that isn’t saturated.

Ultimately, the key lies in blending your passion with market demands, creating a distinctive offering that speaks to both your interests and the needs of prospective clients.

Creating a Business Plan for Your Trading Firm

Source: www.getwork.co.uk

Creating a business plan for your trading firm is not merely a formality; it’s the foundation upon which your entrepreneurial dreams will stand. Begin by defining your vision—what kind of trading strategies will you employ? Will you focus on equity markets, forex, or perhaps cryptocurrencies? This clarity will inform every aspect of your plan, from your target market to your operational framework. Next, conduct a thorough market analysis to identify your competitors and potential clients, ensuring your unique selling proposition shines brightly amidst the noise.

Financial projections are crucial; outline your startup costs, expected revenues, and break-even analysis to illustrate the viability of your venture. Don’t forget to address risk management—how will you safeguard your capital against market volatility? Each section of your plan should weave together, showcasing not only your ambitions but also a pragmatic approach to navigating the complexities of the trading landscape.

This document is your blueprint for success; invest the time to make it comprehensive and compelling.

Legal Considerations for Starting a Trading Firm

Source: luxalgo.com

Establishing a trading firm entails navigating a labyrinth of legal considerations, intricately woven into the fabric of financial regulations. Aspiring business owners must first determine the appropriate business structure—whether a sole proprietorship, partnership, or corporation—each carrying its legal ramifications and tax obligations.

Securing the necessary licenses and permits is paramount; depending on your trading strategies and the markets you operate in, you may need to register with regulatory bodies like the SEC or FINRA. Additionally, compliance with anti-money laundering laws and data protection regulations will shape operational protocols, safeguarding both your firm and clientele. As you forge ahead, consulting with legal professionals proficient in financial regulations is not just wise—it’s essential, ensuring that your firm not only thrives but does so within the bounds of the law, avoiding the perilous pitfalls that could threaten your entrepreneurial dreams.

Conclusion

In conclusion, transitioning from a trader to a business owner by establishing your trading firm is an exciting yet challenging journey that requires careful planning, strategic decision-making, and an adept understanding of market dynamics. By leveraging essential resources, including cutting-edge tools like depth-of-market software, you can enhance your trading strategies and gain valuable insights into market trends.

Building a successful trading firm involves not only honing your trading skills but also developing a solid business framework, fostering a collaborative environment, and staying agile in a rapidly evolving marketplace. With the right approach and commitment to continuous learning, the path from trader to business owner can lead to remarkable growth and fulfillment in the world of finance.

Business

How the Rise of AI and Automation is Impacting the Accounting Profession

Published

6 months ago

December 13, 2024

Anita Kantar

The adoption of advanced technologies is reshaping how businesses handle financial processes. Tools powered by artificial intelligence (AI) and automation are transforming traditional workflows, introducing both opportunities and challenges for professionals in finance.

Accountants must now adapt to thrive in a landscape dominated by innovation.

Key Points:

Automation reduces manual data entry, boosting accuracy.
AI enables predictive insights for better decision-making.
Technology frees up time for strategic tasks.
Skills in data analysis and AI tools are essential.
Ethical considerations are critical for implementing automation.

Automation and Its Role in Streamlining Financial Tasks

Automation tools have become indispensable for reducing repetitive and time-intensive tasks. Functions such as payroll processing, tax filings, and financial reconciliations can now be completed faster and with fewer errors. Businesses looking to optimize their operations rely heavily on platforms like those recommended by Accountancy Capital for sourcing qualified professionals. For more information visit their website www.accountancycapital.co.uk.

By eliminating the burden of repetitive tasks, automation allows accountants to focus on advisory roles, providing higher-value services to clients. This shift highlights the need for upskilling to remain competitive in a changing landscape.

Source: rvnatech.com

How AI Improves Decision-Making in Financial Management

AI tools analyze vast amounts of data to identify patterns and trends that humans might overlook. This capability enhances decision-making, particularly in areas like forecasting and risk assessment. For example:

Predictive analytics ─ AI can anticipate cash flow trends or market risks, giving businesses a proactive advantage.
Fraud detection ─ Algorithms flag irregularities in real-time, reducing financial losses.
Expense optimization ─ Automated systems recommend cost-saving measures based on historical spending patterns.

Leveraging such capabilities requires an understanding of technology, coupled with expertise in interpreting results for actionable insights.

Challenges Created by Technological Advancements

The rapid adoption of AI and automation poses challenges for professionals, including:

Skill gaps ─ Transitioning from traditional methods to tech-driven workflows require upskilling.
Job displacement ─ Roles focused on manual tasks are at risk of becoming obsolete.
Ethical concerns ─ Decision-making algorithms may introduce bias if not properly monitored.

Mitigating these challenges involves ongoing education and embracing continuous professional development.

Source: runeleven.com

Skills Accountants Must Develop to Stay Relevant

The changing landscape necessitates a shift in core competencies. Key skills include:

Proficiency in data analysis tools ─ Knowledge of software that integrates AI is crucial for staying relevant.
Soft skills ─ Communication and advisory capabilities remain vital, even as technology handles routine tasks.
Ethical awareness ─ Understanding the limitations and implications of technology ensures responsible implementation.

Combining traditional expertise with technological fluency is the key to long-term success.

Benefits of Automation for Accounting Firms

Automation tools deliver measurable benefits for firms, including:

Efficiency gains ─ Faster processing of routine functions, reducing turnaround times for clients.
Cost savings ─ Automated workflows lower operational expenses.
Scalability ─ Firms can handle larger client bases without increasing staff.

By adopting technology thoughtfully, firms can maintain a competitive edge while providing exceptional service.

Source: mcgowanprofessional.com

Ethical Implications of Adopting AI in Finance

AI’s growing role introduces ethical concerns that professionals must address. Bias in algorithms, privacy concerns, and transparency issues are common challenges. Firms must establish guidelines to ensure that AI tools align with ethical practices. Regular audits and accountability measures help maintain trust.

Future Trends and Opportunities in Financial Automation

Looking ahead, technologies like blockchain and machine learning will further transform financial practices. Accountants who embrace innovation will find opportunities in consulting, compliance, and strategic planning. Staying informed about emerging trends ensures readiness for new developments.

Conclusion

The rise of AI and automation is not just reshaping workflows but redefining the role of accountants altogether. By investing in upskilling and adopting tools thoughtfully, financial professionals can transition from traditional roles to strategic advisors, ensuring continued relevance in an evolving landscape.