There is one word that is closely associated with the overall Brexit discussion, and that is uncertainty. In terms of economic uncertainty, political uncertainty or regulatory uncertainty.
We live in uncertain and changing times and while businesses and investors like to create stability to anticipate growth, supply and demand, the situation for many businesses is critical, to say the least.
But Brexit isn’t the only concern businesses have as they face disruption from different angles:
Disruption from challengers
Within a company’s sector, there are start-up businesses who have a razor-like focus on customer excellence and experience, the end-user journey, modern digital engagement methods and channels, and who are sustainable and ethically aligned with the millennial generation. These start-ups may not survive the test of time, may suffer from cash flow and other issues, however, they should not be ignored. Businesses should reach out to start-ups in their sector and build partnerships and truly collaborate as they would benefit from new ideas and approaches and could compensate for the lack of internal ideation and innovation.
Disruption from other sectors
Innovators from other sectors who look to grow their market share are a growing threat to businesses. The best example – and ignored by many for too long- is Amazon. Ask Google or Microsoft how serious they took the provision of flexible pay-as-you-go cloud computing platforms when Amazon Web Service (AWS) was launched in 2006. Having had several years of head start on Microsoft Azure (whose first competitive platform was available in 2010) or Google (2012) AWS remains the number one in a sector that nobody ever thought they’d target. Since then Amazon has made several forays into new sectors such as retail or banking.
International competition
Facilitated by the internet and modern technologies, competitors don’t need to be onshore anymore to gain market share in the UK. They can target UK clients from offshore operations and by virtue of reduced cost overheads, challenge UK businesses by offering the same products and services at significant discounts. Alternatively, international territories can attract the kind of start-ups and innovators that previously chose the UK as its base.
A good example of this is FinTech: The UK is still a global leader in Fintech innovation in 2019, but there is a real threat that the UK importance may diminish on an international scale:
So, how does a business faced with these types of uncertainties address these challenges?
The number one strategic importance for businesses is to stay relevant in fast-moving markets and rapidly changing end-user behaviour, thus they need to review and analyse their strategy, proposition and market relevance on a continuing basis. In our experience this manifests itself as follows, based on the lifecycle of the business:
Start-up business
A successful start-up intrinsically knows what problems it is looking to solve, which customers it is targeting and what the proposition needs to encompass. The key objective for a start-up is how to gain relevance and how to propel itself onto the radar of its target audience.
Medium-sized businesses
Having been incorporated several years ago and grown to mid-market status, a medium-sized business needs to be able to pitch to corporate clients, thus it needs to extend its relevance. The messaging and proposition that targets corporate clients is fundamentally different from those for SME audiences.
Corporates
Large enterprises are built on decades of successful trading but the once near-certain assurance that growth can continue unchallenged is no longer holding true. Corporates face competition from all types of businesses, within their sector and from other sectors. The key question for corporates is how to stay relevant. Corporates need to continuously reassess their business strategy and align themselves to key market changes as otherwise, they could add their names to the Kodaks, HMVs, Woolworths, Nokias or Blackberrys of the future.
By continuously assessing, reviewing and augmenting their strategy, businesses will ensure they are gaining, growing and maintaining market relevance, thus overcoming many of the perceived market uncertainties.
Strategy is a well-debated topic and we are keen to hear your views on these points, as well as any stories from your own experiences in putting strategy into practice. Please post your thoughts and tag ‘Whitecap Consulting’ (LinkedIn) or @Whitecapconsult (Twitter), or send me a note at [email protected] to share your thoughts.
Hopefully you’ve found this article useful. If you feel that your strategy development and strategy implementation process would benefit from independent review and challenge, please get in touch.
Established in 2012, Whitecap Consulting is a regional strategy consultancy headquartered in Leeds, with offices in Manchester, Milton Keynes, Bristol and Newcastle. We typically work with boards, executives and investors of predominantly mid-sized organisations with a turnover of c£10m-£300m, helping clients analyse, develop and implement growth strategies. Also, we work with clients across a range of sectors including Financial Services, Technology, FinTech, Outsourcing, Consumer and Retail, Property, Healthcare, Higher Education and Professional Services, including Corporate Finance and PE.