How to make encirclement business strategy a success?

In general parlance encirclement is an offensive strategy made by one strong party against another equally strong opponent. In the field of business, the logic remains same but with a twist. At the beginning of encirclement the challenger must have at least 5X power projection vis-à-vis his defender. Here are the rest of items needed to make encirclement a successful business strategy.

Assessing strengths and weaknesses of the competitor begins the foray into encirclement. By the same token challenger is to target both the strength and weaknesses at one and the same time. What he does is netting of the surplus and deficit and blitzkrieg through one or two important loopholes or saliences.

The central idea driving encirclement is to force the defendant to either make strategic withdrawal or to throw all the resources, human physical and financial at his disposal into the battleground. By this way, challenger puts him on unenviable position.

Major aims of the challenger are two-fold: One is to make opponent lose his courage and composure amounting to breaking of psychological grand standing. Second by launching shock and awe the defender is put on a difficult situation of choosing the rock and the hard place, that is, to fight a losing battle courageously or lose the goodwill of his customers and the market place.

Challenging firm can either opt for using product, market or both as weapons of mass destruction. In the product arena challenger must introduce same product sold by the enemy with improved qualities and user-friendly features. He must also apply product differentiation in terms of quality, utility and fix the pricing accordingly.

If the encirclement is to be concentrated on the market side then challenger must focus on the part of the market that is un-tapped or the part of the segment that is not catered to by the enemy.

Applying few business tactics to mount additional pressure on the competitor is strongly recommended. One is to go for big turnover even at the point of having negative returns so that large customer segment is won over from the enemy. Another tactic that can rattle the competitor is to flood the market with the same product in different styles and models.

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail:   cosmicgems@gmail.com

Blog:   Business Strategist