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Strategy is paradoxically a problem for organizations now

It’s going to take me 2-3 minutes to lay this all out, so let’s get going.

Problem 1: “Strategy” usually isn’t actually “strategy.” When people in charge use the term “strategy,” they are usually referring to “operations” or “logistics.”

Problem 2: “Strategy” must be aligned with “execution.” Let’s say the decision-makers at a company decide on a new strategy. OK. Great for them. But here’s the problem: Peggy in Operations had some stuff she was working on Tuesday and Wednesday, right? So even if the executives hold an “all-hands meeting” and say “This is our amazing new strategy,” well, Peggy still has this stuff on her desk. See Peggy’s issue? There’s no alignment between the buzzword-laden strategy and what people think they are supposed to do all day. “Strategy,” such as it is, needs to be aligned with “execution.”

Problem 3: “Strategy” is usually viewed as intractable. But customer needs and market conditions change constantly, especially with tech. Nothing infuriates me more than “a strategic road map.” It’s all well and good to have one. It might even help guide you. But for so many companies, that’s an 18-month document that cannot change without every middle manager going absolutely bonkers. (In other words, it doesn’t change because eventually no one wants to deal with the drama.) Here’s the best analogy I can come up with: if you are driving from New York to Philly, you have a road map. But if a truck overturns on 95, maybe you go surface roads. Things happen. Road maps need to adjust.

Problem 4: “Strategy” isn’t communicated. Most of your employees are unclear on it.

Problem 5: “Strategy” needs to come from customer needs, but the people who set it are furthest from the customer. Usually 9-14 levels from the customer.

So what’s the overall “strategic” picture here?

It often looks something like this:

  • Executives create a strategy in a vacuum, often with the aid of consultants
  • That strategy isn’t clearly communicated
  • For a long time, it doesn’t even change daily workflows — so people are often doing things not in line with the broader strategy for months
  • Executives breathlessly believe their strategy (logistical plan) is innovative, so will not tweak it
  • Customers are like “New phone, who dis?”

When you see companies do it this way (more normative than we’d like to admit), you sometimes think making money is a complete accident. Sometimes it is. It’s also how companies choose to play with their money — which, by the way, will never benefit people again.

Could there be a better way?

Yes, although it will sound semantic to many. Look at the end of this article on strategy being viewed as a testable hypothesis:

What is new is the idea that closing the gap between strategy and execution may not be about better execution after all, but rather about better learning — about more dialogue between strategy and operations, a greater flow of information from customers to executives, and more experiments. In today’s fast-paced world, strategy as learning must go hand-in-hand with execution as learning — bypassing the idea that either a strategy or the execution is flawed — to recognize that both are necessarily flawed and both are valuable sources of learning, improvement, and reinvention.

Learning does seem pretty valuable, yes. Knowledge sharing at work has been shown to be a legit difference-maker for some companies. Hey, don’t we live in The Knowledge Economy? Right? So shouldn’t we talk about learning, instead of dismissing it as “a HR thing?”

The areas where we need more learning:

Executives need more intel on customers: I mean real data. Otherwise it’s all “I trust my gut” bullshit.

Employees need to know how decisions are being made. Data? Gut? Darts at the wall? What informed what we’re doing?

Both sides need similar vocabularies: Higher-ups usually talk in financial acronyms. Middle managers talk in process document titles. Employees talk about Chance the Rapper. There’s no shared language at most workplaces.

We are a long way from this being a reality at most companies, but ideally we can get there and — pause — “Make Strategy Great Again?”

Ted Bauer

One Comment

  1. Thanks for sharing your expertise Ted! These days “Strategy: The Document,” has become the focus somehow. Putting together a strategic plan is hard work, but the plan itself is not the main outcome (or at least it shouldn’t be). Two more important by-products should be 1) Actionable initiatives and 2) Focused, educated and innovative Thinking. Both should continue well after the Plan document is produced.

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