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commercial strategy

When looking at the issues surrounding commercial infrastructure it is apparent that an commercial/negotiation infrastructure requires clear and effective corporate strategies. For example Danny Ertel ("Turning Negotiation into a Corporate Capability" - HBR May/June 1999, reprinted in Harvard Business Review on Negotiation and Conflict Resolution) states that there should always be a "Best Alternative To Negotiated agreement" or BATNA, per Getting to Yes, by Roger Fisher & William Ury. Creation of a BATNA, other than a calculation that not doing a deal is cheaper than signing it, requires effective corporate direction.

Kathleen M Eisenhardt & LJ Bourgeois III in their study of strategic decisions in the Microcomputer Industry (included in Managing Complexity in High Technology Companies, edited by Mary Ann von Glinow & Susan Albers Mohrman, Oxford University Press 1990) noted that the management teams of successful firms used highly rational and analytic decision-making processes, which were executed in a short time, such companies were not only lead by decisive and powerful CEOs, but their top management teams were equally empowered, individual VPs being more powerful in their areas than the CEO, thirdly they found that successful companies could make bold, risky decisions, but would reduce risk by carefully planning execution and keeping at least one BATNA option in play during the process. In conclusion they found that highly successful companies were able to resolve these apparent paradoxes, but less successful companies lacked the ability to deal with all or some of these factors. The authors found that the failure to maintain alternatives during negotiations, such as the ability to switch to alternative business allies (a BATNA factor) was a major problem for less successful companies.

The microcomputer industry has had to be able to deal with rapid change, and whereas this has not always been an issue for some industries, it is argumentable that change has now increased time pressure on virtually all industries. The argument that decisions need to be made in a timely manner has been the subject of a number of studies including, "Competing Against Time", by George Stalk Jr. and Thomas M Hout, Free Press 1990. "Competing for the Future", by Gary Hamel & CK Prahalad, HBS Press 1994 also addressed the importance of time.

Adrian J Slywotzky & David J Morrison, in Profit Patterns (1999) and The Profit Zone (1997) demonstrated the need to understand the patterns of business, and showed how emergent business models replace older ones.

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