Strategy that works
Rethinking the strategic process
I recently saw this image, and it made me chuckle:
The way we do strategy in organizations can use an update. I wrote about a leadership team's strategy habits before, but in this post, I'll provide a more holistic view of the adaptive strategy process that I've been using successfully over the years to get clients unblocked.
When looking at my client’s strategic plans, I often encounter so-called strategies that are:
a long laundry list of desirable outcomes
a mess of conflicting tasks & priorities
aiming to do too much, doesn't contain bold trade-offs
not defining the challenge or critical area of focus
based on a belief that only a positive attitude is enough
lacking clarity on what to change in everyone's day-to-day decisions
And the biggest problem of all is the use of 'fluffy words.’ Often a result of many days of wordsmithing to try to make everyone happy. For example:
“G.M. is a multinational corporation engaged in socially responsible operations, worldwide. It is dedicated to provide products and services of such quality that our customers will receive superior value while our employees and business partners will share in our success and our stockholders will receive a sustained superior return on their investment.”
What do you think this strategy will do? In any case, it won't help drive any decisions in the organization. A strategy is all about deciding what to do and what NOT to do.
Strategy that works
Furthermore, to have a strategy that can be successfully executed in this highly complex world, we need more shifts:
Annual => Continuous
Top-down => Co-created
Outputs => Outcomes
Planning => Test & learn
Cascading => Multi-directional
Ideally, an effective strategy contains:
simple language, easy-to-be understood by everyone in the organization
clarity on what people can do to implement it in their day-to-day decisions
perspectives from the 'edge' of the organization, not just the leaders
changes to the organization's capabilities or ways of working
a diagnosis, describing the nature of the challenge we're responding to
a connection to customer needs and decision drivers
explicit trade-offs to know what we are deprioritizing
a set of explicit hypotheses that we are testing
a rhythm with feedback loops to steer continuously
Enter Adaptive Strategy.
It's based on three main activities that should be happening continuously and feed into each other: Sensing, Defining, and Executing.
🌡️ Sensing:
creating situational awareness, by asking: what is going on?
what are trends? (economy, nature, tech, society, industry, government)
what is going on with our stakeholders, suppliers, and partnerships?
what are our customer's needs and decision drivers?
what are our competitors offering?
what possible futures can we imagine? what risks and opportunities may emerge?
Output: Diagnosis, describing the nature of the challenge (obstacles and opportunities) in simple terms.
🎯 Choosing:
in response to what we are sensing, what will we do?
what offerings, capabilities or partnerships do we need to create?
what changes to our organization's ways of working do we need?
Output: Strategic Intent: a meaningful but measurable guiding policy that will help people decide what to do and what not to do.
For example, this was the strategic intent of Apple’s original iPod:
Put 1,000 songs in your pocket
🚀 Executing:
90 Day Outcomes: what outcomes must we achieve to realize our strategic intent?
Strategic Trade-offs: how do we prioritize? what will we NOT do? Using even/over statements.
Steering Metrics: how can we measure if we're getting closer to achieving our strategic outcomes?
A few more words of advice:
When sensing, invite perspectives from the 'edge' of the organization. And use Customer Discovery and Scenario Planning techniques.
A good strategy is fractal, meaning the three activities happen at every level of the organization. Let teams pick their own strategic intent and outcomes based on the ones that lay 'above' them.
Design an intentional, strategic operating rhythm to maximize learning and run regular Action Meetings to follow progress on the strategic intent, intermediary outcomes, and steering metrics.
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🚨 Roundtables for future-oriented leaders
Are you leading a team, or are you a member of a leadership team? Then, I’d like to invite you to our leadership roundtables. Register here to get invited to our upcoming session(s) on Unblocking Strategy.
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In other news, after a 7-year adventure, I have left The Ready. I'll announce more about my next venture soon! But a hint can be found in the diagram 🫣