Are you running with a largely reactive or proactive business strategy? Do you wait until you need to act or do you plan your response to events in advance?
Adopt proactive strategies for every part of your business if you want to deliver value to your customers/clients and desire to maximize your growth opportunities.
But some organizations and teams prefer the alternative. See some of their habits below. Do you recognize any you need to change regarding your team or organization?
Reactive vs. Proactive Business Strategies
1. You Stay in Cruise Mode Until a Threat Emerges
You can keep cruising as the leaders in your industry until a threat emerges. Or you can work at disrupting yourself before an external force compels you to do so.
The reactive approach is to enjoy your prosperity bubble until a competitor or startup blindsides you. The better, proactive way is to scan your environment (internal and external) continuously for opportunities to innovate. Follow the path of ambidextrous companies that continue to exploit their current cash cows while exploring new opportunities to succeed into the future.
2. You Think Everything is Fine if No One Complains
Many people consider passing a complaint as a hassle. They wonder why your services are so bad and either resolve to keep buying from you because it’s still convenient or they just stop. They don’t tell you anything.
At those times when complaints do come through managers go into firefighting mode. That’s just being reactive. There’s a better way.
Be proactive. Don’t wait until someone complains. Elicit feedback as early and as often as you can. Welcome all feedback, cherish the negative ones especially because it requires a great deal of courage for some people to communicate critical feedback. The other point is that negative feedback is an opportunity you can mine to improve your offerings and bottomline.
3. You Generally Wait Until Something Happens
Do you wait until you need a list of vendors and suppliers, customer testimonials, or a network of partners before you scramble to collate them? Do you wait for the equipment to break down or do you adopt a scheduled maintenance culture?
Be proactive, build for the future now.
The Benefits of a Proactive Business Strategy
Businesses with reactive strategies play catchup all the time, compete in red ocean territories, and are constantly in panic mode.
Organizations that adopt proactive strategies constantly innovate, invent new markets, and are positioned to seize opportunities to achieve their business objectives most of the time.
The better way, the proactive way is not the easy way. But it will cost you way less and bring you much more gains than waiting for events to unfold before you react.
Here are some benefits you derive when your organization runs in proactive mode:
- A proactive strategy helps to define and differentiate your brand.
- It helps you to develop a culture of innovation.
- Your business becomes nimble. You can take on new opportunities when you are prepared for them.
- You are able to build strong customer relationships and by extension high customer loyalty.
- It provides opportunities to meet your business objectives, e.g., quality assurance, product innovation, customer retention, revenue growth, or business resilience.
- You rise above the competition.
Why Organizations Remain Largely Reactive
The benefits of adopting proactive strategies are obvious. So, why do organizations choose to stay in reactive mode?
Both reactive and proactive strategies come at a cost. The costs associated with adopting a proactive business strategy are paid upfront and are a given. It’s like paying an insurance premium. Of course, the investment is worth it when unplanned events occur.
But some organizations tend to test their luck. There’s no need to change anything if
- a customer does not complain,
- the equipment continues to function (albeit in an obvious decline),
- employees continue to show up.
It’s a gamble that comes with far-reaching consequences.
A 4-Step Method to Developing a Proactive Strategy
1. Look Back
Review instances where you have been caught off guard in the past and had to react to a situation. Make a list of the most crucial events.
2. Look Forward
Consider worst-case scenarios (although that can be frowned upon in hopeful, optimistic environments). Ask questions regarding your most important assets and operations: what happens if abc stops working? What will we do if xyz happens?
Now, identify what you need to put in place as proactive measures to prevent, mitigate or address those issues.
Go ahead, put the resources in place to actualize your proactive strategies.
The Long-Term View
As the leader of your company or team, a good way to develop a proactive strategy for your work and organization is to adopt a long-term, big picture mindset.
Step away from running operations from time to time so you can reflect on the measures you can put in place. You will never get to a place where everything is perfect, but you will know that you are prepared when foreseen and incidental events happen.
We are rooting for you!