Implementing New Strategies – Planning The Variables to Reduce Risk

February 25, 2022

Strategic planning enables the progression from a current-state to a future-state using pre-defined steps.

Each of those steps represents a strategic initiative that, if well executed, can add to profitability.

Most people can see the upside in the potential investment of a new strategy, but it is the downside risks where they fall short in their execution.

Recent surveys by the Institute of Management Accountants, reveal that mismanagement of strategic risks accounted for around 60% of major declines in market capitalization.

There is one system we can use to access the cause and effect of a strategy, and that is by way of a simulation model.

comprises of the inputs, processes, and outputs of the business. Any changes to the inputs and/or processes within the simulation model will affect the outputs, thus appropriate actions can be developed prior to the occurrence of these events, which may be detrimental to the business.

The marketplace is a complex, constantly evolving system and variables will generate a range of different outcomes; this is where time taken to implement a simulation model, to investigate the unknowns and to develop courses of action on these outcomes, will help to eliminate the risks and drive better results.

As simulation complements strategic planning and strategy frameworks, it amplifies the company’s core competencies, enabling it to design strategies to swiftly respond to complex challenges and opportunities.

In fact, the input introduced into the simulation model is so powerful that not implementing one could mean uncertainty or failure of the strategy reaching its overall potential.

Even though a simulation is a critical component to a new strategy, you need to keep it simple and start with one issue at a time, preferably the easiest.

As with a lot of new ideas, there is a tendency to cover complicate matters when it’s not necessary and that leads to confusion and uncertainty.

You want your company not only to implement strategies for futureproofing your business, but you need them to be successful.

Having an unbiased new set of eyes and ears working on a strategy simulation plan, usually introduces new variables to the table that staff, who are too close to the product/service/issue may not have thought of.

Our highly trained team are professionals when it comes to working on company simulations.

In fact – we would like to offer you a free coffee and consult, where ever you are located in the world, so that we may learn a little about what you need and how we may be of assistance.

We can be contacted at any of the below.

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