In November 2010 I evaluated three institutions—all promoting effective governance, media, and civil society in their country. All had received American financial aid for a substantial period of time. One was a private secondary school funded since 2003, the second was a think-tank organization funded since 2001, and the last was a post-secondary independent institution funded since 1996. In the initial years of funding assistance, there were virtually no competitors. All three organizations were leaders in their field, with solid reputations and international respect. They still are. They produced top-class graduates who gained work easily. They still are. They brought international experts to the country as guest lecturers, whose advanced “free-thinking” knowledge was well sought after. They still are. The alumni of all three organizations appreciated the best training their country could produce in good governance and transparency. Many continued their studies in America and Europe, and many are currently in leadership positions.
What happened over the past two to three years to these institutions? Their competitive edge waned, course participants didn’t automatically knock on their doors, the urgency to seek funding from other sources put a strain on lecturers, and attracting international guest lecturers cost more each year. Why? Conflict with their neighboring country made tourists and international investors nervous and the global financial crisis impeded the capacity of participants to afford elite, quality study. However, these two factors weren’t the cause of the institutions’ downtrend in some course enrolments (nor did they result in a decline or a threat to their existence).Their quality of courses, education, training and services did not decline—to their credit they all maintained their strict selection criteria. But they were all facing tough times amid continual and rapid government reforms.
The key factor is this: over the past ten years other institutions in the country emerged and existing ones strengthened—and they have risen to almost the same standard as the original institutions. The three institutions no longer have a market niche, no longer have a monopoly on the delivery of education and training, and no longer enjoy a unique reputation. They are all under threat of losing their number one status in their field. Not only that, the funding provided by the United States Government ceases in September 2011.
Does this sound like a familiar global scenario? Does it sound like the institutions are in the same dilemma as their funding body? Take the debate about whether America is losing its number one status as the “world’s leading nation” to potential country threats such as China and India. The 2010 Legatum Institute’s Index of Prosperity—a measure of material wealth and quality of life among 110 nations—ranked the United States as 10th, a fall from its number one place in 2007. America has not yet toppled, but the times, no doubt, are tough. What to do??
Have years of remarkable success failed to keep these institutions (and America) at the number one spot? Was complacency, lack of foresight, lack of innovation, and a rigid adherence to their niche market factors that hampered their success? Were they just too cock sure of themselves? One of their failures was not being intimately familiar with their competition—they failed to watch their competitors’ progress over the years and to accept them as potential threats. By the time they realized that they had competition, it was almost too late. The first rule of business is, and always has been: know your enemy (competition). Institutions that are not successful spend time and money on becoming successful. Institutions that are successful at their outset often don’t.
What to do? What not to do is to ask the United States Government for more money. To address their concerns the institutions have been focusing on reducing their debt, re-locating to cheaper premises, providing shorter fee-paying courses, establishing programs outside their core business, marketing their core programs, and seeking additional funding.
Some of their dilemmas are: do they stick with their niche or diversify; do they offer more of the same or seek to innovate; do they chase fads (become opportunistic), do only the “tried-and-true” or re-define their business strategy; do they charge for services that were once free; do they reduce or increase their fees; do they become more homogenous within the market; how long do they persist before they change; are they throwing the baby out with the bathwater; and how good is progress if your customers aren’t buying into it?
Now is the time to think strategically about how to reverse the downtrend to stop it from becoming a decline and a disaster. What needs to happen? What does an institution need in these competitive and changing times?
They need flexibility, diversity, and quality (of selection criteria, products, and services). Not only do they need to be responsive to the changing market, but they need to be “one step ahead” of it—just like they were when they were first established. Not only do they need to be innovative in course and service development, but they also need to discard, restructure or reinvigorate what has not been performing—and who have not been performing. They need to plan for the unexpected, plan for when activities don’t go according to plan. Not only do they need to review their products, services, and advertising campaigns, but they also need to review their management—staffing, philosophies, goals, objectives, communication strategies, and roles and responsibilities (the “whole package”). Not only do they need to monitor their opposition, but they also need to more effectively and efficiency monitor and evaluate their own progress. Done effectively, monitoring and evaluation are not just fancy (and complicated) activities; they are useful in taking an honest perspective on what is working, what is not working, and why. They can determine benchmarks and set realistic targets. Then institutions can strategize how to reach their goals and objectives, step by manageable step. And they can continuously refine and improve their plans to keep one step ahead of the competition.
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