“Uncertainty Excuse” or the End of Old-School Strategy?
In a recent Harvard Business Review article, Professor Roger Martin rightly decries business executives who say they “can’t or won’t do strategy because their operating environment is changing too much.”
Unfortunately, he seems to place responsibility for the lack of strategy almost solely on the desks of the executives. Unfortunate, because I believe this masks the root causes of the problem. In his comments, Martin notes that few CEOS have “a useful definition of strategy” and even fewer are “any good at it.” Why is that and what can be done about it?
In my view, strategy is under-used and poorly implemented because, as it’s currently taught and understood, it’s too complex, it doesn’t integrate naturally with execution, and it’s not responsive to today’s rapid cycle times. We need a new way to do strategy.
Strategy is too complex
Here’s a fun thing to do: ask a room of seasoned business executives, profs and consultants to define strategy in 15 seconds. I did this recently and heard a variety of definitions with little agreement, none that hit the mark, and few that made the 15-second cutoff.
You can see this for yourself: scan through the comments to Martin’s article. Rather than addressing the issue directly, contributors often felt the need to state their own understanding and definition of strategy. And their definitions conflict.
Martin senses the confusion and steps in to define strategy. He does this by sending readers to a two-part newspaper article he co-wrote (here and here). His article illustrates my point exactly: it runs 3,031 words and has a Flesch-Kincaid reading ease score of 27 (I used this online calculator). You need a university degree to understand it because the article is harder to read than the Harvard Law Review.
Another clue: the article relies heavily on Procter & Gamble as an example. This is the world of academics, big business and large consulting firms.
Strategy has been obfuscated by this world. Loading it with unnecessary complexity has made strategy less accessible, less relevant and less helpful to business.
Strategy isn’t well-integrated with execution
Strategy is still too often taught and practiced as a body of thought independent from the tactics and tasks required to achieve it. This separation destroys strategy’s value and subjects execution to the market’s whipsaw. This is the world of steamships: officers on deck and hands down below. Autocracy and rebellion.
To be useful, strategy must guide execution clearly and, just as important, listen to the messages that execution sends back.
Strategy is not responsive
Strategy is commonly understood as something that guides a firm’s medium- and long-term direction. But business cycles have greatly accelerated in the 60 years since business strategy’s inception. Modern executives trying to navigate these faster waters are right to question the usefulness of this slow-moving tool.
So what’s the answer?
The core of the answer actually lies in a comment to Martin’s article made by Rob Leclerc. He suggests that business strategy adopt some of the aspects of the Agile software development approach. Agile is simple, responsive and iterative and has significantly improved software development’s quality and productivity.
Martin entirely discards Mr. Leclerc’s suggestion. In so doing he loses the opportunity to help refresh strategy and bring it into the modern age.
In simplifying strategy, I’m not suggesting that it has to be dumbed down or appeal to the lowest common denominator. What I am saying is that it has to be accessible and practical. If it’s easier to understand, it’ll be easier to communicate and implement.
I’ve done this for the businesses and students I work with. I developed a simple, responsive, integrated and iterative strategy approach. I then wrapped it in an iPad app (called StratPad) to make it even more practical and easy to use.
Now thousands of business executives in more than 100 countries use StratPad every day. They demonstrate that strategy is alive and well and relevant even in today’s uncertain world.
Let’s not blame executives for not using tools that don’t work, Professor. Rather, let’s find ways to update and sharpen those tools so that executives will feel compelled to use them.
P.S. Here’s my 15-second definition of strategy
Business strategy concerns itself with what makes an organization unique, how the organization will defend its uniqueness, and how this uniqueness will be turned to the organization’s advantage.
Or, as I prefer to teach it:
What makes you unique?
How will you defend your uniqueness?
How will you turn it to your advantage?
Flesch-Kincaid reading ease score: 69. Which makes it understandable by grade 5 students.