Improving Strategy Development with Opportunity Analysis
One of the hallmarks of an efficacious strategic planning function is its ability to accommodate forward-looking industry and competitive assessments. Why, then, are strategists so compelled to use tools focused on the present, and, more alarmingly, on the past?
A technique called Opportunity Analysis may provide an answer. Unlike tools that describe the present and historic environment, Opportunity Analysis asks: what specific activities can an organization perform to increase the chances of achieving its strategic objectives in the future? Opportunity Analysis does not focus exclusively on a firm’s current capabilities, industry structure, or even whether a company’s activities are congruent with its long-term vision. Methods such as SWOT Analysis, Porter’s Five Forces, and the Balanced Scorecard address these questions effectively. Rather, Opportunity Analysis is purposive; it inspires action in ways these other techniques do not.
Opportunity Analysis identifies opportunities and/or vulnerabilities that arise from external circumstances that can either advance or impede an organization’s strategic objectives. The model does so by forcing intelligence consumers to identify and articulate the “best case” scenario for their business and then to identify the environmental conditions that have a direct bearing on the firm’s objectives, either for better or worse. After identifying all the impeding and supporting conditions within the operating environment, a firm should then identify the tactics necessary to either take advantage of supporting conditions, or minimize those conditions that may impede the firm’s desired outcome.
Opportunity Analysis compels strategists to focus on the “what should be?” instead of the “what is.”