Costs of the Wrong StrategyJul 23, 2021
What are the Big-6 Costs of Chosing the Wrong Strategy?
Too many managers are quick to chose a strategy and too slow to recognize the costs associated with execution of the wrong strategy. It pays to take a little more time to get on the right track and to then continously assess the results against expectations.
The costs of choosing the wrong strategy can be huge.
There are Six Big Costs that can be avoided by taking the time and doing the research and thinking to establish the correct strategies in each business area. Take a look at the costs you want to avoid. Start right and finish on target and on time. Start wrong; fail to assess and change and you will be dragged under by these Big Six Costs:
1. Direct project-related expenses that do not provide the desired result. (You can only spend it once.)
2. Man-hours of effort invested by all direct and indirect employees involved to execute the strategy. (In most businesses this is the limited resource that must be applied in the right way at the right time.)
3. Frustration and lost opportunity to effect a Return on Investments of time and money. (Failed strategies can greatly affect the overall returns for shareholders and impact both CAP-X planning and compensation plans.)
4. Loss of chronological time needed to achieve the desired goals and objectives. (You can restart, but the clock does not...so you will have to do double-time to reach the objectives as planned.)
5. Loss of confidence in judgment by colleagues and other management. (Once gone, it is hard to regain!)
6. Loss of personal confidence to predict the results of implementing a strategy as well as the loss of confidence that desired objectives can be realized. (No manager can be effective unless he/she believes in their own abilities to make good decisions.)