Dynamic Strategic Management

Effective prediction and strategic response to the increasingly uncertain environment

The current business environment has the highly uncertain features, which can not only involve many external factors, but represent the larger differences, frequent changes and unpredictability. To better cope with the highly uncertain business environment, the King Parallel team always believes that it is very essential to carry out the dynamic strategic management. The main measures include: (1) make the structural analysis, scenario-based prediction and dynamic tracking of the business environment; (2) affect and even guide the environment towards a favorable pattern; (3) improve its own core competitiveness; (4) formulate a high-level and dynamic strategic management system, as well as carry out process management on environmental research, strategic planning, strategic decomposition, and strategic implementation.

The analysis of the environment should be constructed from two dimensions of the environmental stability and environmental complexity, while the uncertain business environment will bring two challenges to the company, mainly including the increased uncertainties and the generated successful traps. The former can lead to the company making unreasonable decisions, while the latter makes it difficult for the company to analyze the key factor to its own success.In other words, the current successful factor may become the cause for tomorrow’s crisis.

Based on a large number of environmental and corporate cases analysis, the King Parallel has concluded the dynamic strategic management model in uncertain business environment, mainly including the structured analysis model + environmental guidance and corporate capacity improvement model + dynamic strategic management model.

The structured analysis model refers to the structured and situation analysis of the business environment according to the market plasticity and predictability. And the business environment can be divided into six structures or scenarios, including the classic, scenario, chaotic, plastic, track and weak ecology types. Moreover, it also has proposed six strategic choices in different scenarios.

Environmental guidance and corporate capacity improvement model means that enterprises should change the disadvantages into advantages and take actions actively, guide the environment to provide more opportunities when facing uncertain business environment, and continuously improve core competitiveness through the resources integration, mechanism improvement and management reform, in order to carry out strategic planning at a higher level and avoid the unpractical strategic planning.

The dynamic strategic management model has three aspects of meanings, respectively including establishing a whole process strategic management, establishing a strategic adaptation system and developing the dynamic strategic management.

Whole-process strategic management refers to the entire process of the environmental research and judgment, strategic planning, strategic decomposition and strategy implementation. It is very necessary for enterprises to effectively manage this process.

Strategic adaptation system means that it is very necessary for the enterprises to establish an organic coordination system of resources, actions and organizations. The effective allocation of resources, the quicker actions and the agile organization can better get adapt to the dynamic adjustment of strategies.

The development of dynamic strategy should focus on the real-time tracking and accurate judgment of the dynamic environment changes, dynamic strategy adjustment according to the dynamic environment changes, as well as the real-time dynamic tracking and feedback on the specific implementation.

The development history of Alibaba can be considered as one of the typical cases of dynamic strategic management. As a B2B company providing the information and marketing service platform, Alibaba only focused on the expansion of its own B2B technology to achieve the online and product development from offline to online, made itself become the network trading platform, and also established a B2B technology ecosystem through the establishment of cooperative relations with technology partners. Its precise grasping of market and industry trends has created the great success of Taobao.com, and expanded the business from B2B to C2C.