Strategic Management Issues at BrixTec

A number of lessons learned were gained from identifying strategic management issues at BrixTec. First, we learned that financial leverage is critical. BrixTec had not made the most of its financial resources and had accumulated some short-term debt with a negative $4,000 in its checking account. It had not accumulated any long-term debt, which might have gained it financial leverage at a lower interest rate than short-term debt. The company did not seem to keep close account of its financials, and this illustrated the value of handling financials weekly and ensuring that there is always cash on hand to run the business with.

Another lesson was acknowledging and dealing with competitors and threats. Our client at BrixTec was unreceptive to discussions that we tried to initiate with him concerning his competitors and what they had to offer, preferring instead to brush off the threat, merely criticizing his competitors as a poor choice for customers because of their inferior product lines. He did not seem to understand that his personal tastes were not the issue and that tastes and financial resources differ among customers. Ignoring the competition does nothing to defuse its impact on a business, and the lesson here was that an objective analysis of competitors is a must for understanding how one's company is positioned in the marketplace.

Third, a business owner must remain cognizant of his business at all times. This client managed three disparate businesses simulta

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