Strategy. We hear and use the term every day. Indeed it has become something of a status symbol, separating the exciting ‘macho’ work of MBA-armed executives from the hapless ‘troops’ who simply go about their work following the instructions from those who know far better than them.
Originally a military term defining predetermined offensive and defensive moves and countermoves deployed by armed forces in the heat of battle, the standard approach to strategy arises out of the ‘cause and effect’ hypothesis of games. The intention of strategy in this context was to capture territory or to inflict casualties on a scale that would convince the enemy to surrender.
Incidentally, a basic idea here, which also appears to be a fundamental flaw, is that there must always be a winner and, ipso facto, a loser.
In theory, of course, it is convenient to portray the outcome of a game in such orderly terms, particularly as it ignores distracting or ‘soft’ factors, such as the social value inherent in team-based games, for example.
In the hurly-burly reality of today’s volatile and unpredictable world, however, where new and unholy alliances form and dissolve so rapidly, such a simplistic concept is bound to cause confusion as much as it creates impossible expectations. In spite of this, the militaristic notion of strategy has been mindlessly adopted by business schools and enthusiastically pursued by the majority of business leaders.
Sometimes it appears that becoming bigger is all that really matters. Growth equals progress, CEOs are constantly advised. So the treadmill of unremitting merger and acquisition activity generates ever larger corporations irrespective of the damage being done to people (as in staff and customers) and, in many cases, to the economy. This reckless quest for growth at any cost also ignores the fact that growth can mean getting better rather than bigger – a fact lost on many aggressive executives. Such simplistic thinking is now giving rise to huge, potentially catastrophic, economic and social problems, ranging from executive remuneration and talent retention to issues related to prosperity, the rights of ownership and the legitimacy of the commons.
Originally, in corporate life, planning was not in the least bit strategic in nature. On the contrary, it was simply a response to the complexity of production – an attempt to coordinate people, equipment and resources to be more efficient. Eventually, as methods became more reliable, planning became longer term. By and by, as managers realised they could sell more goods (thus optimising the capacity of their production plants) by predicting which of their products would sell, and to whom, various forms of forecasting and budgeting were built in to the process.
Planning only really became strategic, however, in the truly militaristic sense of that term, following World War II when the global business environment began showing such signs of competitiveness that each corporation was required to out-manoeuvre the other if they wished to survive. Initially, relatively unsophisticated strategies were implemented around branding and positioning. Eventually, however, new technologies coupled with fairly sophisticated strategic management systems allowed corporations to change the rules of competition at a moment’s notice. The game had become so engaging that entire units devoted to strategic planning were set up.
Today, more often than not, strategy has become a linear process where ‘secret’ plans, goals and targets are established by an elite group of senior managers who may or may not be in touch with the real world. Because the process of strategic planning has become such an infrequent event – often occurring only once a year and undertaken by the leaders in the corporation irrespective of their ability to think strategically, any resulting plans tend to lock the corporation into a single future path, usually within an horizon of 2-5 years.
We are all too familiar with the implications of this approach. But the unavoidable result is that the strategy, as originally intended, is hardly ever realised.
For one thing, changes in environmental conditions always demand continuous corrections but senior managers rarely have the time to spend making changes to and refining their original ideas, seeing such iterations as a waste of time when they could be busy ‘doing’ something. For another, the bureaucratic systems and procedures that, with re-engineering, could enable optimal deployment of any new strategies, often remain untouched due to a lack of understanding, resources or will.
And then, even when the strategy is sufficiently robust to withstand the test of time, people may continue to do what they have always done. Ask them why, and they are likely to respond with a million good reasons. Yet inevitably the root of the problem can be seen in weak overt communication as well as the underestimated power of implicit, more informal, cultural interchange.
Indeed, much of the research into social organisation carried out over the past 20 years points to the importance of implicit messages embedded within group culture. We believe up to 80 per cent of actual performance may be directly reliant upon embedded communication of one kind or another – habits, gossip, assumptions, tacit knowledge and the like. Conversely, less than 20 per cent will be directly attributable to explicit plans or goals – however well communicated these may be. The lesson here is to do with the significance of culture in determining what is done as well as how it is done.
Explicit communication of strategic plans and goals, therefore, often has very little effect on the performance of a corporation. Perhaps people aren’t convinced the new strategy can work and so continue to do what they have always done. Perhaps their personal values clash with what they are being asked to do. Or perhaps they simply do not fully comprehend how the new strategy affects them. In some cases they may not even have heard about some significant strategy, so secretive is it.
Whatever the reason, the results betray the inevitability of a self-fulfilling prophecy. Managers spend indiscriminate proportions of their time attempting to get ‘buy in’ from workers, industrial relations problems abound, there is a preoccupation with implementation and ‘doingness’, and issues of responsibility and accountability never quite seem to get resolved. Arguably of more consequence, the strategic responses intended by the corporation’s leadership team remain ever only partially realised while a critical mass of the workforce continue to do what they’ve always done – thus limiting potential change and development.
We prefer to confer a very different meaning on the term strategy. From an ecological perspective, strategy doesn’t actually exist – at least not as a visible, palpable ‘thing’.
A good strategy is only ever temporary.
Like many words in the management lexicon which we take for granted strategy, even in its more conventional sense, is only a metaphor, a mental map that we use to help us make sense of our reality. Ideally, strategy is distributed consciousness – an alignment of epistemologies where cognisance is both implicit and explicit ‘knowing’.
As far as I am concerned, effective strategy is dynamic, transparent, and constantly present. It is manifested in every moment of an organisation’s reactions, both to the market and to other unpredictable factors. When viewed this way it makes more sense to perceive strategy not merely as a set of programmed responses to changing environmental conditions, but more as a characteristic mode of thinking from which a rich repertoire of different types of responses can be distilled and actioned by individuals and groups.
Strategy as a characteristic mode of thinking will normally be defined by explicit intentions, (such as a salient driving force and worldview ambitions, for example) and characterised by distinct ethical or moral qualities. It also uses different time frames to make sense of apparently unrelated patterns of events for creating intelligence and, over time, results in the distribution of context-aligned responses and initiatives throughout the corporation. These responses and initiatives are most effective when they integrate business and social factors.
This is precisely the approach taken by Five Literacies leaders in Strategic Navigation where strategy is defined as a characteristic mode of thinking that uses intelligence to align responses and initiatives across the organization in order to realise sensible and ethical business intentions.