Tag Archives: Strategy

Let’s Stop Confusing Strategy and Tactics in Healthcare

strategyI can’t tell you how many times we’ve seen very smart healthcare companies – med tech companies, payers, provider organizations, etc., confuse strategy and tactics. And it reduces their effectiveness every time.

Why do strategy and tactics get confused? First, sometimes there is not clarity about what the real objective is and why. This subjects companies to the paradox Lewis Carroll described this way: “If you don’t know where you’re going, any road will get you there.”  Without a clear end point in mind, develop meaningful strategy to get there is very difficult.

Second, there is so much pressure to get new things to market, it makes it hard to carve out time and think strategically. There’s only time to “do” — even if what is being done doesn’t make good sense.

So what’s the difference? Strategy determines how you will achieve your goal. It represents which map you will use to get where you are going. Tactics are the map details and are all about the doing.

Let’s start with a couple military examples: 1) Divide and conquer is a strategy. Sending half the troops in a frontal assault and half on flanking maneuvers are the tactics that executes on the strategy. 2) Go big, go long, or go home, were the three strategies being considered in the Iraq war. How many troops would be where and when were the tactics, and that’s what got all the media coverage.

Marketing examples: 1) Be first to market is a strategy. Be a fast follower is an alternative strategy. The specific products or services you take to market, the resources you allocate, and the timing are all tactics. 2) First get prospects in the door with a low barrier to entry, then engage them to be customers is a strategy. How you will go about getting them in the door and converting them into customers are the tactics.

 

Don’t be one of the many companies that spend millions of dollars and years of effort on something only because their competitors are doing it. Have a good compelling reason. That way you know where you’re going and why.

Next be clear about what your strategy is, and why. Make sure your strategy is really strategy — and not tactics with the word  strategy attached. Then get into the tactics that execute on the strategy.

Lastly, make sure your team knows the difference between strategy and tactics and why it matters.

Developing Your New Market Entry Strategy: The 3Cs Framework

Imagine you’re a large medical technology company carrying a wide range of healthcare products. You see huge opportunity in a new market. How do you decide what innovation to lead with, what products to offer, and what your market entry strategy should be?three_c_V2

Here’s a framework that can help you narrow the universe of possibilities. We call it the 3 Cs, which stands for Company, Customer, and Competition. All three are critical factors that converge to reveal the sweet spot for market entry.

Company: This is often the starting point for med tech companies. They see a lucrative market, want a piece of it, and figure they have something good that will sell there. The driver is the company’s desire for growth and their belief in the solutions they offer. The “company” factor narrows the universe by identifying three things: 1) Core competencies and existing assets that can be leveraged for entry into a new market, 2) New competencies the company wants to develop, and 3) New care areas they want to expand into.

Customer: This is about identifying and understanding unmet needs and meaningful problems customers care about, as well as needs and problems they may not be aware of yet. The driver is what customers desire and will pay for. Determining these things requires being really tuned in to your customers. The “customer” factors narrow the universe by revealing 1) what customers want and need and will buy, 2) what their hidden desires and aspirations are and  what better state they envision, and 3) what customers don’t want, don’t value, and won’t pay for.

Competition: The competition factor focuses on identifying what customer needs are and are not adequately met by competitors, and what solutions you have that are already provided by others in the market you want to enter. The driver is finding an open niche of sufficient size for your innovation to take hold. Generally, companies will stay away from markets where there is domination by one or two competitors – unless they are willing to make a huge investment to unseat market leaders. The “competition” factors narrows the universe by specifying 1) where there is space for innovation, 2) what solutions exist and which are still needed, and 3) where there is good growth potential.

The danger is that the company’s hunger to enter a new market can lead to rash decisions and action without a guiding strategy. To mitigate that risk, give serious consideration to customer desire and to the competitive space. That way you avoid being driven by company solutions and wishes, rather than customer problems and desires.

What’s your experience developing new market entry strategy? What were your decision drivers? What lessons did you learn?

More resources:

How to Grow Your Business with Customer-Centric Innovation

How to Get to Breakthrough Innovation: Desirability First!

New Product Innovation: How to Determine the Winners