Strategy is Changing – Developing Your Strategy
Author: Warren Knight
In this blog, PMI’s Head of Strategy Practice Warren Knight argues that a traditional approach to strategy development is no longer appropriate for our rapidly changing global economy and what is now required is a continuous, learning-orientated approach, that matches the ever-increasing pace of change.
Strategy is changing
We all recognise that we are operating in an intensively competitive, rapidly changing global economy, this is nothing new nor surprising; As the Greek philosopher Heraclitus pointed out, “the only thing that is constant is change”. And in some cases, that rate of change is not constant but accelerating.
Faced with such an environment, organisational agility and adaptability become paramount survival skills, which strategy plays a fundamental role in developing. For this to happen, we must change the way we think about strategy and its development.
The problem with traditional strategy development
Traditionally, strategy relies upon accurate long-term prediction. The problem with that is, the more dynamic environment the less easy it becomes to accurately predict the future. In some cases, the strategy could be out of date well before the next cycle of analysis and planning takes place.
The implications of sticking with a strategy that is no longer appropriate is obvious. Even if this is recognised and attempts are made to change course, there are still significant costs as the organisation is knocked out of its strategic cycle or ‘rhythm’. Initiatives are put on hold, unscheduled analysis and planning activities must be instigated at short notice and employees told that the direction previously communicated is no longer appropriate. This all creates turmoil, unease and disruption.
There are approaches that we can take which will help us overcome this challenge, through learning and physical conditioning.
Here are some things you might want to consider to help you overcome this challenge:
- Set a mission, vision and values for the organisation that are robust and enduring; these create much-needed stability with regards to the organisation’s overall direction and provide confidence within its workforce. This frees up the strategy to be agile: a short-term plan set firmly in a long-term frame.
- Effective, data-driven analysis of the environment, both external and internal, remains essential. However, think about the scope of your analysis and how it might be expanded. Can parallels be drawn with countries, markets, organisations or technologies that are outside your sphere of competition, but could also be learnt from?
- In addition to traditional trend forecasting, invest time in developing ‘what if’ scenarios for various aspects of your organisation and environment. This will reward you with more innovative suggestions that are not hamstrung by what has happened in the past.
- When your analysis concludes that there are a number of possible ways in which the future could unfold, it may not be wise to attempt binding the strategy to a single theory and prediction. What you can do is hold a small number of carefully considered possibilities, look for what is common and different, and plan responses accordingly.
- Focus on developing your organisation’s core strength because they improve your adaptability to unforeseen variables. Organisation’s core include employees’ abilities, leadership, culture, supplier relationship, customer relationships, and brand image.
The crux of the matter: how strategy is developed.
When in the act of planning, we are doing everything required to be agile: analysing the environment; testing existing predictions; creating new predictions and adjusting plans accordingly. The organisation’s senses, brain and nervous system are fully engaged and working as one.
Therefore, increasing the tempo of your strategic planning cycle will no doubt improve your reaction times. Better yet, if you can integrate your strategy development and review process with your ongoing execution, management, and feedback processes you create a continuous, real-time system.
In tomorrow’s world of rapid and unpredictable change, strategy will remain essential to prosperity. However, for this to be true it must also change.
Gone are the days when we could confidently carve strategy into stone, safe in knowledge that it would see us through the years to come. What is now required is a continuous, learning orientated approach that enables us to match the pace of change.
Warren Knight is a Director Consultant and Head of Strategy at PMI. He is a highly experienced change and performance improvement consultant and has supported many global enterprises throughout his career. Warren specialises in helping clients develop, deploy and deliver truly effective strategies helping clients not only to develop their goals but to translate them into action and most importantly, results.
If you have any questions for Warren, please do get in touch.