Environmental change is inevitable. To survive, companies need to do strategic drift.
If company do not handle the strategic drift carefully and do not make any transformational change then they will start losing sales and market share and in worst case company will no longer relevant.
Example: Nokia, Kodak etc.
If an organization fails to keep up with the changes in its external environment it can lead to what is known as Strategic Drift.
Environmental change is inevitable. To survive companies need to respond effectively to opportunities and threats and to avoid strategic drift.
If company do not handle the strategic drift carefully and do not make any transformational change then they will start losing sales and market share and in worst case company will no longer relevant.
Example:
Kodak knowingly ignored the digital photography and didn’t do anything and now they are nowhere.
So it is very clear that company have to take steps according to the situation.
When the company is facing the strategic drift they have to respond upon but upto what extent they need to change their strategy depends on which phase the company is going through currently.
Avoiding Strategy Drift:
1) Forming culture that can cope with change.
2) Regular assessment of its environment.
3) Must have strong leaders who are willing and able to make change the strategy or direction.
4) Clear idea of its mission and objectives to guide strategic choices.
What if Hyundai / Ford do not plan to launch electric car.
There are lots of transformation happened in past years like Netflix have changed the whole industry and because of these changes, lots of business have to change their strategy.
Kodak knowingly ignored the digital photography and didn’t do anything and now they are nowhere.
This lesson is waiting for its secure Vimeo video.
