You Can’t Grow Long-Term If You Can’t Eat Short-Term

Business can fail for a variety of reasons, but one of the most common is due to a failure to solidify and align long-term and short-term strategy. Short-term strategy have different objective than long-term ones, which is why it makes sense to spilt them up.

What if a firm only use short-term strategy?

Short-term strategy talking about immediate issues with customers, wages, suppliers, and staff. In the short-term area, a firm needs cash to pay wages and bills. If it focuses too much on the immediate present. It risks missing opportunities.

What if a firm only use long-term strategy?

New products, new markets, innovation, and business growth are the focus of long term strategy and it runs out of capital to fund investment. If a firm too much focuses on new prospects it will soon become unprofitable.

Like chinese sign-symbolizing complementary opposites, Yin-Yang. A succesful firm have to balance short-term and long-term strategy.

Anybody can manage short. Anybody can manage long. So, make sure in you have the resources to keep strategy balance.

Sources: The Book Business Page 190–191