Strategy Dynamics Briefing 70: Basing decisions on direct effects

Posted by:

Briefings 68 and 69 showed the dangers of decision-rules based on simple ratios or on overall performance outcomes. For the consumer brand’s marketing-spend decision from recent Briefings, for example, either “Spend x% of revenue on marketing”, or “If profits fall, spend less/more on marketing”.

So what do we need instead? Well, the basic problem is that neither of these approaches focuses on the direct consequences of the decision – winning customers! So a decision on marketing spend should surely respond ...

Continue Reading →
0

Strategy Dynamics Briefing 64: Types of strategic decision

Posted by:

The briefings to this point have set out the main dynamic structures that determine organizations’ performance. The next few briefings examine how decisions steer those structures and how to design policies (decision-rules) that can build and sustain the resources required for strong performance. First, though, it is helpful to clarify the different kinds of strategic decisions. A logical approach is to follow a more or less chronological sequence over the life of an organization, although these questions cannot be treated ...

Continue Reading →
0