Williams explains in his article that strategy in face of uncertainty and rapid changing environment, must have a portfolio of options on future plans. Not only must companies have portfolios of options for the future but they must react with opportunism. One mistake that many companies make when following a strategy is they overinvest in capital, assets and capabilities that are specific to one strategy with out keeping in mind that the environment is changing and so is the strategy. The message William present is this: “while companies may focus on executing a single strategy at any point in time, they must also build and maintain a portfolio of strategic options.” He says that a company will be able to reposition themselves better than those who invest only in what they are doing.
Establishing a portfolio for future options involves the following:
- Uncovering the Hidden constraints on the company’s future. – To avoid becoming a prisoner of hidden constraints, a company must build new capabilities and expand their knowledge of new market segments/ customer behaviors.
- Establish processes for building new strategic options. – Companies must be on the look out for rule breakers and respond by creating options and exercising the new markets.
- Optimizing the portfolio of strategic options. – Companies must look at the alternatives and even measure the company against the alternatives in the market.
- Combining planning and opportunism. – Key is to keep opportunism inside the realm of the companies direction.
A successful strategy must combine both planning and opportunism in regards to the strategy they employ.