The Importance of Strategic Planning

With better planning, would Borders Bookstore still be here?

I'm a complete book nerd. So of course I need to ponder the closing of Borders Bookstore. Would they still be here if they had planned better? What if they'd hopped on the e-reader bandwagon sooner? And if they had shifted their level of commitment to E-business?

Strategic Planning: Defined in our textbook as, "the managerial process of developing and maintaining a viable fit between the organization's objectives, skills, and resources, and its changing market opportunities." Clearly, Borders neglected the parts concerning their resources and changing market opportunities.

Borders once prided itself on carrying the largest inventory of books in their brick-and-mortar stores. They stocked thousands of books, and had just about one of anything you were looking for. And then if that one thing you wanted wasn't there, it was almost guaranteed that another store had it. But as the economy declined, was this the smartest idea? They had the resources (like shelf space) to stock this amount of books. But what about the remainders? What if they had a slow week? Where did they fit new books as they came in? Meanwhile, Barnes & Noble had a larger online inventory, and, guess what, they are still here. Where's Borders?

E-reader Bandwagon: This ties in to the strategic planning idea of "changing market opportunities." Borders did not adapt very well to their changing market. As the economy dipped and people began to curb the amount of money they spent on books and other pleasures, Borders simply carried less stock, thus going back on their guarantee to always have what you were looking for (as mentioned above). While Amazon and Barnes & Noble were competing to become the top e-reader seller, Borders simply carried less, and sent out fewer (or smaller) coupons. It wasn't until 2010 that Borders partnered with the Sony Kobo - except the Kindle was introduced in 2007 and the Nook in 2009. By the time Borders introduced the Kobo, it was too late for them. And the biggest disappointment? The Kobo wasn't even an original Borders product.

Another mistake Borders made? Continuing to stock such a large inventory of music and DVDs, despite the shift to online video streaming, Pandora Radio, and iTunes.

Level of commitment to e-business: As I've mentioned, Borders really relied on their brick-and-mortar stores above all else. They had more inventory in their stores than online, and they held off on the digital e-reader until they were desperate. What if Borders had had more of an enterprise level of commitment to business? What if they had made the shift online sooner, rather than later?

Stocking more inventory online would have meant freeing up shelf space in the brick-and-mortar stores for new books, or more popular books. Rather than have books sit on shelves for weeks and months, thus losing them money, it could have meant stocking just a few and losing less profit on those not sold. It also could have given Borders more room to do other things - anything that could have given them a leg up. A bigger cafe, more gadets and gizmos, maybe even an area in the store devoted to their e-reader, as Barnes & Noble stores have done.

Clearly, Borders neglected to create a long-term strategic plan. They didn't look into the future, and they refused to adapt to their environment until it was too late. We'll never know what could have happened if they'd done things differently. We can only wonder.

R.I.P Borders.