Essay About Projection Of Costs And Comfort Trap

The Big Lie on Strategic Planning
Essay Preview: The Big Lie on Strategic Planning
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The article gave me a lot of insights and I really enjoyed reading it. It did not only correct my wrong understanding of what a strategy is, it taught me the difference between a strategy and a plan. In addition, the following are my opinions and realizations:I agree that oftentimes, people avoid making strategies. Hearing the word gives me a picture of long, sleepless nights, brainstorming, spreadsheets, and projection of costs. In addition, just like what the author mentioned, I have the tendency of turning a challenge into a problem that can be solved with tested tools.I realized that I also fell under the comfort trap 1. The way I understood strategy was actually the process of planning, as illustrated in this article. I always link strategy with planning, especially creating “strategies” out of projected budgets. I came to know that for something to be a strategy, it must not be bound by affordability alone, and it’s not simply choosing what can fit the company’s resources. Comfort trap 2 really caught my attention. I fell on the trap of treating revenue planning as identical to cost planning, and as an equal component of the overall plan and budget. I always use the cost as a basis for “revenue-generating strategies” thinking that I have made my part in researching and observing events relevant to the decisions I am about to make. However, I agree with what the author mentioned that this is not the proper treatment. Costs are under the control of the company, whereas, as to revenue, the customers are in charge. For me, this is the reason why one should not use cost as purely the basis for making strategies to increase revenue. Instead, find ways to acquire and keep customers for they are the source of revenue. I learned from comfort trap 3 that a deliberate strategy must be used. That is, being intentional instead of following that of the competitors’, or simply emerge a strategy as events unfold. For me, this doesn’t mean to have a fixed strategy which cannot be changed especially on today’s environment, it just suggest to make a deliberate strategy, then just correct it as changes unfold. One cannot expect for its strategies to be perfect because even if we have studies and projections, no one knows what will exactly happen in the future.I learned that a plan is different from a strategy. A plan is limited to what is already known and can be controlled by the company. On the other hand, a strategy is beyond these events. It’s going outside your comfort zone, stepping out of what you think is “comfortable,” similar to taking a “step of faith” in the business you are in to. You believe that this certain action will bring your business good even if you cannot totally control and predict the outcome of such decision or action. I came to know that a strategy should not be long, just like a plan. This is so because a strategy would focus only on increasing customers and in taking care of existing customers. The main object of a strategy is the choices that influence revenue decision makers, the customers. Revenue gives life to the business, hence, when the revenue is taken care of, with the matching control of costs, I can say that a business will surely grow.It is important that we keep track of the strategies already implemented and even the ideas that are yet to be used for a certain strategy. Sometimes, we tend to forget, especially when we have many things to do, or think of brilliant ideas during our quiet moments. So to make sure that everything is accounted for, I agree with what the author has mentioned, to write down critical information.