FRICTION WITHIN THE COMPANY AND FROM THE MARKETPLACE
As you shift to the offensive and ready your plan for implementation, you must reckon with the realities of a competitive marketplace “by taking into account the favorable factors” as well as “the unfavorable.” In particular, it is the unfavorable market forces that can create friction and the likelihood that your business plans are delayed, modified, or totally trashed.
The eminent business scholar Michael Porter lists his famous five competitive forces, which are characterized here as potential types of friction:
- 1. Rivalry among existing firms in an industry
- 2. Threat of potential new entrants
- 3. Bargaining power of buyers
- 4. Threat of substitute products or services
- 5. Bargaining power of suppliers
Friction takes other inhibiting forms. You will find the damaging effects in the psychological sphere when exhibited by employees through
Fear and uncertainty
Lack of trust resulting from ineffectual leadership
Depleted levels of energy due to negative perceptions about unfolding market events
Discouragement, and even defeatism, resulting from aggressive competitive actions
Friction also springs from apathy and buying resistance from customers to your product offerings, or indifference to a new incentive program from key players in the supply-chain. Then there is deep-rooted friction from inexperienced or poorly trained employees. They are the ones who are not up to the rigors of implementing offensive strategies, which require discipline, cooperation, commitment, and mental agility to stay balanced against the gyrating ups and downs of competitive encounters.
Consider, too, the internal friction from the organizational logjams and layers of management that prevent the clear communication of directions from senior management to field personnel.
Also, due to an inability to obtain correct data in a usable format, friction surfaces when decision-making managers are unable to correctly estimate the situation and act rapidly on a market opportunity. Still other areas of tension come from the internal staff that fails to provide timely financial, legal, logistical and other vital information.
Friction continues its insidious damage by fostering errors that slow down day-to-day operations. With the causes of friction seemingly limitless, you should be fully aware of the ones that surround you. Then do what is necessary to limit the irreparable damage to your overall business plan as you shift to the offensive.
The power to recognize your chance and take it is of more use than anything else.
The “power to recognize your chance” has as its foundation the conscious use of logic, experience, and training. Beyond those essentials are the immensely powerful personal qualities of the inner mind to deal with the potential damaging effects of friction: namely, intuition.
To assess things in all their ramifications and diversity is plainly a colossal task. Rapid and correct appraisal of them clearly calls for the intuition of a genius.
The inner light ... the inward eye ... discreet judgment ... unerring prescience ... the sensitive instinct. It is a higher form of analysis. Action can never be based on anything firmer than instinct, a sensing of the truth ... that the mind would ordinarily miss or would perceive only after long study and reflection.
To some, intuition suggests an ethereal quality that cannot be pinned down when it comes to developing actionable strategies and reducing the dire effects of unfavorable situations. Yet, there is sufficient historical and empirical evidence from the likes of Clausewitz to modern-day leaders to confidently rely on this innate quality to take action and avoid being immobilized by friction. This is especially so where rational thinking and market intelligence do not produce trustworthy solutions.
You are able to experience intuitive assistance in a variety of ways, such as by instinct, insight, hunch, or gut-feel. You also receive impressions in the form of a vision, hearing, and sensation.
Therefore, in a competitive confrontation, what ultimately plays out is a contest of your mind’s creativity and originality against that of a competitor’s mind. Consequently, where you need to rely on intuition, you can engage the mind and free it in a purposeful direction. Intuition, therefore, is personal and takes on your inborn personality, as your mind goes to work on a problem.
Strategy, then, is a blend of art and science that embodies the distinct imprint of the individual, which is made distinguishable by the infallible quality of intuition. Therein lies the genius of those managers who overcome friction and rise to success.
For some strong-willed, in-charge managers, nothing can replace intuition. And even where managers lack originality and a determined personality, there are decisive moments when they must take counsel within themselves, make decisions, and move forward.
Accordingly, trusting in intuition to contend with friction is a reliable technique. And seasoned managers consciously know the value of intuition in emergencies. Yet, they are also fully aware that intuition must be anchored to solid experience, judgment, and ongoing training—as well as to the concepts and principles suggested in this and previous chapters.
Proof that your intuition is working appears when you reach a comfort level and where relatively sound decisions come almost automatically—so that you know intuitively, for instance, that one strategy is more likely to work, whereas another will not.
And notwithstanding the voluminous quantities of knowledge to support decision-making, savvy managers understand that most market events are more or less hidden in a mist of uncertainty. And uncertainty is further magnified as they recognize that competing managers must rely on intuition, as well. Moreover, those rival managers are also surrounded by dynamic physical and psychological forces that create damaging friction that clouds the competitive scene.
A skilled commander selects his men and they exploit the situation. Now the valiant can fight; the cautious defend, and the wise counsel. Thus, there is none whose talent is wasted.
Although your weightiest decisions are often made on uncertain premises, it would be totally false to assume that success is a matter of sheer luck. It is not luck in the ordinary sense that brings achievement. In the long run, so-called chance favors the skilled and intuitive manager. This is especially so when you select people to “exploit the situation [so that] ... there is none whose talent is wasted.”
With that in mind, there are five propositions with which you should be familiar. If you apply them, you will increase your chances of success:
- 1. Seize opportunities by holding firm to a mind-set that takes a bold, proactive approach, rather than taking a more cautionary move.
- 2. Make reliable estimates and calculations of resources, markets, and competition as part of your strategy development.
- 3. Hold reserves and select your people to exploit favorable market opportunities, as well as to react quickly against aggressive competitive moves.
- 4. Encourage creativity and innovation in your role as a leader.
- 5. Recognize and deal with friction originating within the company and from the marketplace.
In sum, taking all actions that permit you to shift to the offensive is one of the most productive and winning principles of strategy. Therefore, even when forced to the defensive, as in protecting your share of market, your best course of action is to develop a plan for the offensive. As Clausewitz pronounces:
A fundamental principle is never to remain completely passive, but to attack ... frontally and from the flanks, even while he is attacking us.
Action in war is like movement in a resistant element. Just as the simplest and most natural of movements, walking, cannot easily be performed in water, so in war it is difficult for normal efforts to achieve even moderate results.
-  See Porter, M., Competitive Strategy, Techniques for Analyzing Industries and Competitors. New York: Free Press, 1980.