In the last few months two giants of New Zealand business have provided us with perfect examples of why having a clear strategy for your business is critical to long term success.

Telecom New Zealand have been in the spotlight because of the XT network failures. And they are doing damage control big time whilst their competition makes the most of the opportunity to increase market share. But what is behind the XT debacle asside from some possibly very bad decisions about suppliers and capacity. I suggest it is a lack of a clear strategy. Strategy is simply a plan designed to achieve a long term aim. So a business strategy must be a plan to achieve long term market share.

We achieve market in one of three ways. 1. We get really close to our customers and with them to deliver exactly what they need. 2. We decide to lead with the market with product innovation. 3. We become the very best operators and deliver excellence in customer service and quality. Which one of these do you think Telecom NZ was attempting to do? There is no evidence of it being number 1 and it certainly wasn’t number 2 and if it was number 3 they have failed dismally. My guess is they didn’t have a clear strategy and their decisions have been towards one or the other and so they have oscillated without clear direction and consequently lost market share.