Before making tactical withdrawal, do the risk analysis

Tactical withdrawal is one of the risky business tactics that can be resorted to by firms amidst severe competition. The sole objective is to preserve the current position to be ready for future prospect. But this action is fraught with extreme danger because seasoned competitors would know how the game is being played. Therefore, it is vital to undertake thorough risk analysis before attempting any tactical withdrawal.

Business does not quit at all when implementing tactical withdrawal. It may be time bound before re-entering the market with new or improved product. Here is the catch: time is in essence in effecting tactical withdrawal as well as the duration of dis-engagement from the market.  The following issues must be fully debated to get a global picture of how business tactics of tactical withdrawal might play out:

1. The risk of re-entry is paramount. Before quitting temporarily, firm must assess when re-entry could take place and at the time of re-entry how strong will be the competitors and how weak will be the internal competency of the firm. A longer disengagement sets in lethargy amongst the staff manning operations. This is acute in the marketing department where most of the actions that took place earlier has now disappeared and the agility has suffered enormously

2.  The line of communication set up with key partners such as suppliers of materials on the production side and dealership in the distribution side might fall silent for considerable time bringing some form of disquiet or disinterest in their minds that has bearing on the frim when it readies for re-entry

3. The question that props up immediately is what happens to the overall defensive mechanism the firm built-up earlier in meeting with challenges of competition. If these systems degrade it would affect the firm very badly

4. Unless everything works round the clock, reconstitution of men & material for the production and operation of new line of product might suffer serious set-back

5. What happens when competitors are not deceived at all by this tactical withdrawal and they draw their own conclusions about the firm, its mind-set and the ulterior motives and are more than ready to meet the firm in any new battle ground as and when firm comes back to the market?

6. The last issue is what happens when all hell breaks down in the market place regarding the firm and its intentions. Competitors seize the opportunity to conspire against the firm by bringing out a major campaign to delegitimise it altogether. This could be a fatal blow that is!

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail:   cosmicgems@gmail.com

Blog:   Business Strategist