Strategy has been a theme around here for the last few weeks and one thing about strategy is that you are never going to always be successful.
Which always presents an issue for the organization that is dealing with a faltering, struggling strategy.
You know: sunk costs!
You know the old saw that says: “Don’t throw good money after bad.”
Which just means that once you have made an investment, good or bad, it is done.
How does this apply to your strategic efforts?
Well, to put it simply, once you have spent that money…it is gone. If you are getting an ROI, great! Keep making the investment, but if you aren’t, don’t keep going because you figure that you are going to recoup that money at some point. That is highly unlikely…especially when it comes to marketing and sales efforts. Usually, the only way you recoup those costs is by using the mistakes you made the first time to improve your marketing and sales efforts in the next go round.
Which leads to the question: What if we are wrong?
If you are in business long enough, you will be wrong. You will spend money that you can’t recoup. You will enter markets or take on opportunities that will not pay off.
The challenge is not to let this overwhelm you.
Here’s a few steps to help:
1. Understand that you need to draw a line under period:
You are going to have to just embrace the misstep and move on. That’s the key concept and if you aren’t prepared to do that, you will find yourself on a treadmill of lost money.
So draw a line and move on.
2. Take a moment to reflect on what worked and what didn’t work:
One thing I have learned over the years is that nothing is ever really black or white. The same goes for your business ups and downs.
So what do you do?
Take a moment and practice something that any good project manager would and take account of the lessons learned from the project.
What was successful?
What was unsuccessful?
What assumptions did you make? Were they accurate? Were they inaccurate?
Go on and on until you have an understanding of the good and bad of the experience you just dealt with.
3. Make a plan to go forward:
Just because your current strategy didn’t work the way you wanted it to. That doesn’t mean that you shouldn’t have some sort of plan for how to move forward.
In fact, I would tell you that having a plan to move forward would be more important than ever because you don’t want to allow your frustrations about the failed strategy lead you to take irrational actions that will only further damage your business.
So make a plan, even just a few action steps…so that you rebound from a failed or unsuccessful strategic effort and don’t get caught spinning in circles, throwing good money after bad.