Blog #4: Taking Strategy From Development to Implementation

In the paper ‘Have You Tested Your Strategy Lately?’, the author mentioned ten tests to evaluate whether a strategy is successfully implemented. Test 6 asks whether strategy is formed in the anticipation of uncertainty. I think it is the most important part of strategy execution. In real scenarios, the whole market is a field of dynamics, with all participants moving, aligning and shaping at the same time. Simply in competition, different players will be adjusting to each other’s strategy. Without anticipating uncertainty, one strategy cannot handle the dynamics of the environment. For example, CVS planned to increase access to customers by establishing branches within easy reach of residents as a part of its strategy to make retail and healthcare more convenient. However, Walgreens, a main competitor, also likes to establish stores at locations similar to CVS because they both look for places that have a good balance of residential foot traffic and real estate expense. In addition, a new entrant PillPack seeks to simplify the purchase process by moving pharmacy business online and deliver products to customers in a new way. In this case, CVS cannot simply make the strategy decision of spending heavily on branch expansion – first because with the involvement of Walgreens it will earn lower-than-anticipated profit for some new branches it opens, second because with the growth of PillPack its off-line branch stores will have less foot traffic. In the anticipation of such shifting dynamics, CVS needs to combat the growth of competitors within the industry and seek to pursue competitive advantage at more specific sectors instead of anticipating that it will win in both pharmacy and retail business. For example, it should save capital to prepare its online sale, roll out new services that would have cost advantage to Walgreens. In fact, CVS did slow its branch expansion and with its existing branches it has been engaging in introducing pharmacy healthcare service in connection with prescriptions. This move targets more specific customers who need a series of healthcare service instead of only prescription. In addition, CVS has also rolled out online delivery service shortly after PillPack was acquired by Amazon. This is a good example why uncertainties (in this case, disruptions and market changes) should be taken into consideration for strategy design and implementation.

ng Strategy From Development to Implementation

In the paper ‘Have You Tested Your Strategy Lately?’, the author mentioned ten tests to evaluate whether a strategy is successfully implemented. Test 6 asks whether strategy is formed in the anticipation of uncertainty. I think it is the most important part of strategy execution. In real scenarios, the whole market is a field of dynamics, with all participants moving, aligning and shaping at the same time. Simply in competition, different players will be adjusting to each other’s strategy. Without anticipating uncertainty, one strategy cannot handle the dynamics of the environment. For example, CVS planned to increase access to customers by establishing branches within easy reach of residents as a part of its strategy to make retail and healthcare more convenient. However, Walgreens, a main competitor, also likes to establish stores at locations similar to CVS because they both look for places that have a good balance of residential foot traffic and real estate expense. In addition, a new entrant PillPack seeks to simplify the purchase process by moving pharmacy business online and deliver products to customers in a new way. In this case, CVS cannot simply make the strategy decision of spending heavily on branch expansion – first because with the involvement of Walgreens it will earn lower-than-anticipated profit for some new branches it opens, second because with the growth of PillPack its off-line branch stores will have less foot traffic. In the anticipation of such shifting dynamics, CVS needs to combat the growth of competitors within the industry and seek to pursue competitive advantage at more specific sectors instead of anticipating that it will win in both pharmacy and retail business. For example, it should save capital to prepare its online sale, roll out new services that would have cost advantage to Walgreens. In fact, CVS did slow its branch expansion and with its existing branches it has been engaging in introducing pharmacy healthcare service in connection with prescriptions. This move targets more specific customers who need a series of healthcare service instead of only prescription. In addition, CVS has also rolled out online delivery service shortly after PillPack was acquired by Amazon. This is a good example why uncertainties (in this case, disruptions and market changes) should be taken into consideration for strategy design and implementation.