Strategic drift is when a company responds too slowly to changes in its external environment. Instead, the company decides to simply continue with past strategies that have helped it prosper.Know More
A company may be out of touch with new technologies and current trends if it remains status quo with the strategies it has used in the past. Quite often, the older model is simply inappropriate and cannot compete with future trends.
One main reason for strategic drift is due to changes in the technological environment. There are, however, a few questions one can ask to analyze a possible source of strategic drift. For example, the analyst can compare and contrast the way in which the Internet is currently used in the company compared to a year ago. Areas to investigate are the way purchases are made; communicating and sharing information like videos; and the way business trips are booked.
Companies need to monitor both its internal and external environments. The assessments should include whether it is ahead of the curve, in pace with current technology or behind the curve. One example of a company that suffered from strategic drift is Blockbuster, as it did not transform into an online retailer and the company lost business to Netflix.Learn more about Pro Auto Racing
A strategic plan is a document that delineates the goals of a company or an organization and establishes the actions that are necessary to achieve those goals. It encompasses all critical elements developed in the planning stage to strengthen the operations and ensure a directed endeavor among all employees.Full Answer >
Strategic issues refer to important aspects that require attention in order to achieve the business goals of a company. Strategic issues require careful decisions and clarifications to resolve, and have a critical impact on the performance of a business, according to Thomas Ambler of Center for Simplified Strategic Planning. They include the organizational structure, products, marketing, human resource management, customer service, resource management, strategic partnerships, business models and strategic management.Full Answer >
Strategic analysis is the use of various tools to prepare business strategies by evaluating the opportunities and challenges faced by the company as it moves forward. Typically, strategic analysis involves a review of internal strengths and weaknesses as well as factors in the external environmental that could affect business.Full Answer >
The figures found in the statement of cash flows are pulled directly from the changes in balance sheet accounts throughout the year for a company, explains John A. Tracy from the "Accounting Workbook For Dummies." The increases and decreases in balance sheet accounts are the foundation for preparing a statement of cash flows because they drive the amounts shown in the statement.Full Answer >