How the Presidential Election Shapes Strategic Choices | Executive ...

As a strategic planning facilitator, I am in the room while hundreds of strategic decisions are made each year.? Naturally, entrepreneurs need to understand their environment in making fact-based decisions, a process made difficult when the political environment is tenuous and volatile.

With the advent of social media and real time information, the hype surrounding the presidential election is unlike any other we have experienced. Many industries are bracing for the implications of potential sea changes in policy. It is as if the country believes the outcome will provide two very different sets of market conditions.

Consider the business of gun manufacturing and gun retailing. Before the first presidential debate, Smith and Wesson increased its forecast, citing a 30% gain in volume out of fear that the President will restrict the purchase of guns in his second term[i].? Bass Pro Shops is preparing for a ?ramp up? of gun sales going into the election (the law of unintended consequences is clearly at work).

For industries such as guns and ammo, health care and others, organizations engaging in strategic planning must consider multiple scenarios. In each scenario, the organization can map out a separate set of assumptions, regulatory and otherwise. ?The key to useful scenario planning is considering numerous variables at once and then analyze the implications of how certain combination will impact industry demand, pricing power, etc. ?Many organizations create multiple versions of budgets that reflect varying levels of demand.

In this particular election, there seems to be more angst about the regulatory environment as the current administration has exercised its will over numerous agencies through executive order.? While the current environment is something like a Sumo wrestling match, the fear is that the executive branch can change the dynamics of an industry with the stroke of pen.

The problem with all of this is that there is significant lag between the time that a President is elected and his policies are enacted.? The process for approving regulators on boards and commissions takes months (some are never filled at all). ?Waiting for regulatory action? can create a form of paralysis.

Some of our clients actively engage in advocacy measures that provide them greater access to information about pending legislation or shifts in regulations.? It is actually rare for small businesses to see an ROI in hiring lobbyists. However, having access to information about where the political winds are blowing can provide competitive advantage.? Involvement in trade associations and other industry groups is pivotial is seeing around the bend.

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[i] Election Has Gun Sellers Stocking Up by Shelly Banjo ?WSJ 9/15/2012

Source: http://blog.vistage.com/business-strategy-and-management/how-the-presidential-election-shapes-strategic-choices/

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