Whatever situation you are in, having a strategy in place is crucial. So whether you are launching a new product, or you are going through an economic downturn, or your business performance is climbing up rapidly; a sound strategy is essential for your long-term performance and business health. In their book “Organization Strategy, Structure, and Process” Raymond Miles and Charles Snow have put forward four different strategies: Prospector, Defender, Analyzer, Reactor. Each of the strategies is discussed further below:
Organizations that fall into the category of Prospector are innovators and developers. They are always seeking out for new opportunities and they are willing to take on new challenges and risks. This is how they grow; through creativity, experimentation, and flexibility. As a result, organizations implementing a Prospector strategy are usually the ones that lead change and uncertainty; to which their competition must later on respond. Although Prospectors promise some big successes, they are also likely to face significant losses as well. It’s all about the successes outweighing the losses.
As the name implies, organizations that follow a Defender strategy are the ones who are pleased with their current situation in the market and they are willing to defend it to stay exactly where they are over the long-term. In other words, organizations that are implementing a Defender strategy are not going after any major changes in technology and operations, but they instead shift their focus into improving the efficiency of current operations. In a deteriorating market or a stable industry, Defenders can gain a significant competitive advantage.
Organizations pursuing an Analyzer strategy aim to uphold their current market place while also building on other innovations and developing new products. Companies that fall within this category are usually large corporations with a secure market space and sound reputations. While they are trying to defend what they have built so far, they also invest in new innovations that respond to the demands of the market. Companies with an Analyzer strategy often have tight financial controls but yet high flexibility and efficient production. As a result, they are enjoying low costs and customized products.