Conventional wisdom regarding evaluating strategic options is to use a SAF approach:

S means Suitability of the strategy. A means Acceptability. F means conduct a feasibility study.

My personal opinion on this (am willing to be persuaded otherwise – what do you think?):
1. How can you truly judge suitability before you’ve seen the results? These days, defining the competitors and the market is hard as market boundaries become more blurry. A strategy professor (Prof George Tovstiga) at Henley Business School* suggests  that it’s now no longer about competitive sustainable advantage (as Porter had proposed), but that companies effectively move from one unsustainable advantage to another unsustainable advantage.
2.  If evaluating strategic options (using tools like cost benefit analysis & risk scoring say) is difficult, then evaluating feasibility (conducting feasibility studies) is likely to also be difficult, with the quantified results perhaps have a large margin of error in reality. Suggest that like for forecasting, all you can do is best efforts and be flexible enough to react tactically along the way, if things start going really pear-shaped. Organisations can try ‘proof of concept’ and prototyping of new product ranges/business models/business arrangements to new or existing markets, but there is still likely to be uncertainty on a) how competitors will react, b) how well the prototype will scale-up to full market or business model size, c) how long market demand for that product range/business model or business arrangement will hold.
3. Regarding acceptability,  I suspect many strategic options get chosen in organisations, largely on how the politics operate at the senior level (this would be a good post-grad research project for someone to test out). Also, if a private company has a majority shareholder who is also the Chief Executive (like Microsoft in the early days, co-owned by Bill Gates & Paul Allen, or Richard Branson with Virgin with his famous phrase ‘screw it, lets do it’), then gaining acceptability on specific strategic options is relatively easy. However, if members of the senior management team aren’t the business owners, but are fairly transparent about their plans to the majority shareholders/debt holders, acceptability still may or may not be an easy hurdle to jump.
http://www.henley.ac.uk/web/FILES/corporate/cl-Changing-the-way-we-strategise-GT-WEB.pdf
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