Competitive Strategies
The Assumptions Risk

We all live our lives and run our businesses on a lot of assumptions, otherwise we’d never get anything done if we had to prove every assumption first.  Yet sometimes relying on assumptions without regularly challenging or revisiting the more potentially consequential assumptions can lead to future trouble.

The Covid 19 pandemic was a painful case of assumptions being wrong.  Looking across the world at how countries responded to the crisis, we find several small Asian nations had difficult experiences with MERS and SARS a decade ago that made them realize their assumptions about viruses and pandemics needed a new, more proactive approach.  Putting systems and materials in place for an unknown future virus enabled them to respond quickly and contain the spread.  Contrast that with many Western countries that avoided the MERS and SARS outbreak and continued to assume the next virus would be again avoided but then had to scramble to control it.  By 2022, the contrast between China’s zero-Covid approach and the world is yet another example of how assumptions (and in China’s case, politics) may keep you linked to a less-effective approach.

On a smaller scale, step back and think about what assumptions you make about your product, your consumer, or your competitors.  What are your top 3 assumptions which, if they’re wrong, would be most painful for your business?  Exploring alternate views now, and planning around those could help improve your business plan’s stack of assumptions.