Operating vs. Strategic Decisions

We define Strategy as “The Art and Science of meeting your competitors in the Market under advantageous conditions”. It’s about positioning your business relative to your competitors. It’s about gaining market share when you are advantaged and exiting markets when you have no advantage. Strategic decisions should always be market centric decisions.

Operating decisions are structural decisions associated with staffing, facilities, asset management, and controlling and financing the business. They are often not strategic decisions as they do not relate to how we are positioning our business in the markets we serve.

When I was at a large NYSE company, George Gage, the Vice President of Business Planning, indicated most of our managers spent the majority of their time on operational decisions unrelated to strategy. As a business manager we come into the office each day and face a deluge of e-mails, follow-up phone calls and lengthy conference calls seldom getting to focus on those decisions critical to our market position and changes in the size and shape of our markets.

How much of your time is trapped in making the day-to-day operational decisions? Do you spend any part of your day analyzing competitors, surveying changing customer needs, searching for the market externality or market alternative products or services that will significantly impact your business?