DeM Banter: does this bother anyone else? We really don’t know what strategy is anymore…do we? National Security Strategy….really? Do we have one? 90% of all government plans should stem from there…at least on a foreign policy level…although one could argue…THAT is a primary job of the Federal Government and perhaps an NSS would in turn align and sync very closely with any domestic strategy: note the authors comment…one can only have one strategy…do you agree?
View Original /blogs.hbr.org/ February 5th 2013
I must have heard the words “we need to create a strategic plan” at least an order of magnitude more times than I have heard “we need to create a strategy.” This is because most people see strategy as an exercise in producing a planning document. In this conception, strategy is manifested as a long list of initiatives with timeframes associated and resources assigned.
Somewhat intriguingly, at least to me, the initiatives are themselves often called “strategies.” That is, each different initiative is a strategy and the plan is an organized list of the strategies.
But how does a strategic plan of this sort differ from a budget? Many people with whom I work find it hard to distinguish between the two and wonder why a company needs to have both. And I think they are right to wonder. The vast majority of strategic plans that I have seen over 30 years of working in the strategy realm are simply budgets with lots of explanatory words attached. This may be the case because the finance function is deeply involved in the strategy process in most organizations. But it is also the cause of the deep antipathy I see, especially amongst line executives, toward strategic planning. I know very few who look forward with joy to the commencement of the next strategic planning cycle.
To make strategy more interesting — and different from a budget — we need to break free of this obsession with planning. Strategy is not planning — it is the making of an integrated set of choices that collectively position the firm in its industry so as to create sustainable advantage relative to competition and deliver superior financial returns. I find that once this is made clear to line managers they recognize that strategy is not just fancily-worded budgeting and they get much more interested in it.
Obviously you can’t execute a strategy without initiatives, investments, and budgeting. But what you need to get managers focused on before you start on those things is the strategy that will make these initiatives coherent.
That strategy is a singular thing; there is one strategy for a given business — not a set of strategies. It is one integrated set of choices: what is our winning aspiration; where will we play; how will we win; what capabilities need to be in place; and what management systems must be instituted?
That strategy tells you what initiatives actually make sense and are likely to produce the result you actually want. Such a strategy actually makes planning easy. There are fewer fights about which initiatives should and should not make the list, because the strategy enables discernment of what is critical and what is not.
This conception of strategy also helps define the length of your strategic plan. The five questions can easily be answered on one page and if they take more than five pages (i.e. one page per question) then your strategy is probably morphing unhelpfully into a more classical strategic plan.
2 Replies to “Don’t Let Strategy Become Planning by Roger Marti”
Have to agree with the author. I’ve seen what he describes during my Navy time as well as in the corporate world. Just yesterday, I even had questions from my wife about Strategy and Strategic Planning. So I asked her how the Euro 8 Billion company for which she works does it. A strategy and lots of strategic plans under it. I, myself, have probably even contributed to the strategic planning insanity, although I must say that I do try to spend a good amount of time on “scoping” and ensuring that the choices made there are clear. Unfortunately, people in leadership positions often struggle to set boundaries, i.e. make choices, and communicate clearly what’s in and what’s out. That is why Tony Blair’s remark, which goes something like “Leadership is being to say ‘no'” resonates with so many (aspiring) leaders.
Roger: Agree as well… one strategy and everything stems from that. I also agree folks have a hard time saying no… at in that line… leaders don’t develop a strategy as to not constrain their subordinates… We all have to know where we are going and where the left and right limits are…once established we all work some much more efficiently and effectively