Strategy

The plan won’t cut it

Introduction

Imagine the scene. A young man in a train carriage is totally engrossed in a YouTube video on how to be more attractive to woman. What he doesn’t see is the attractive woman sitting opposite trying to catch his eye. Something similar is playing out in many organisations today.

Leadership offsites, coupled with the advisory firm (boilerplate) slide decks are the typical precursors to a strategic plan, a document that is, in essence, the strategy at a single point in time.

Today CEOs are opting to follow their strategic plan, rather than acknowledge reality. Investors and analysts expect no less! Unfortunately with increasing disruption, the plan and reality are deviating in real-time. Consequently the leadership team are driving the organisation with a document that might be labelled in genre terms as ‘business fiction’. The ending will be no surprise.

Surface symptoms

So, how does this decoupling from reality manifest itself.

Day to day operations, which is where the organisation abuts reality, make little reference to the strategic plan. So the majority of the workforce see the strategy as a fanciful activity that fires up the c-suite, but in practice hinders delivery.

The organisation is blindsided by emergent threats and is paralysed when emergent opportunities present themselves.

There is a sense that the organisation is lurching from crisis to crisis. The cogs are grinding and both leaders and the talent are feeling the heat.

The solution typically involves one or more of the following:

• Double down on cog grinding

• Arrange an expensive leadership programme – “there’s something amiss at the top”

• “We have the wrong talent pool. HR, do a full refresh”

• Go all in on AI and hope that the ‘tech pixie dust’ will get the plan back on track

• Give the remaining staff free gym membership.

Sometimes there is lingering sense that the strategy is good but miscommunicated. So an internal marketing initiative makes the goals impossible to ignore unless you move around the building fixing your eyes on the carpet. However even the most ‘Bourne Identity’ inspired programme doesnt fix it.

The reality observed

The fighter pilot who enters a dog fight with the strategic plan resting on their lap or displayed on their headset will not be involved in many dog fights. As the Prussians like to say, “No plan survives first contact with the enemy”.

Again it appears that leaders confuse strategy and strategic plans. Opting for the latter because it is a ‘one and done’ exercise rather than something that requires constant vigilance. The static playbook is attractive and works well for ‘finite’ games. But we are no longer in a finite game world.

This playbook approach is akin to the leaders setting up a compass to point north in the c-suite and sharing the image with the rest of the organisation with a note saying “let this image be your operational guide”. Static solutions rarely work in dynamic environments.

The pristine slide deck has limited value when workflows are put under excessive pressure, supply chains become more precarious, customers are more skittish, decision-making freezes and a bevy of black swans waddle into reception.

What’s really going on

For the last few hundred years, give or take a few major shocks - world wars, pandemics and technological leaps, the world has operated in a steady, and thus predictable state. You could build a factory knowing that the demand for the goods produced would exist for enough time to make the factory investment worthwhile.

Today the world shifts between complex and chaotic. Black swans are now a pest. A strategy that looks sound at T=0, is a historical relic at T=1. The linear notion of Think/plan -> Do -> Win with occasional resets does not map well onto the new reality.

Imagine inventing a car with the assumption that it would only be used between two points A and B, connected by a straight road. You then discover that consumers want cars to operate on multiple roads. Unfortunately the car has no turning capacity as that requirement was not considered important during the analysis phase.

You might say that strategy, as practised today, needs to morph into what one might call meta-strategy. An approach is needed that enables leaders to modify the strategy in real-time. Think of your strategy as a forever prototype, always in draft, always in beta. Such an approach embraces feedback loops and is thus non-linear.

So it’s goodbye certainty and process, and hello unpredictability and innovation. And best of all no one knows how this will play out other than knowing that such a dynamic approach will keep the organisation aligned with reality. Please note that a meta-strategy on its own will not guarantee future viability if leaders try to execute through an organisational model designed for more innocent times.

Why it will get worse

As organisational strategy becomes increasingly frayed, leaders will be replaced, and AI will be purchased with the same scrutiny that is applied to stationery procurement. Investors and analysts will gravitate to those organisations that are optimised for chaos, eg. Amazon, Google, Facebook and Zara.

AI will shake the organisation foundations of traditional organisations in the same way as feeding amphetamines to an arthritic elder at a rave – surging energy trapped in structural rigidity, with a strong likelihood of severe loss of anatomical integrity.

Key point

Instead of meta-strategy, it might make more sense to call it emergent strategy. So strategy is less a plan and more a set of principles adhered to in real-time. This approach naturally flexes with reality and so increases the likelihood of ongoing viability.

This approach works well for ants and bees. Nobody need be brilliant. But everybody needs to adhere to the principles. It could be argued that this is decentralised, or even ubiquitous, leadership. Thus the most junior staff member has the autonomy to do what is right at a given point in time and space. Much like an organised religion, there is no anxiety / loss of cognition when faced with a dilemma - just apply the principles to the current situation.

Whilst bringing religion into the discussion is potentially triggering, in its defence, such an approach will attract people who buy into the associated principles. Such people will be all too happy to progress the mission. This is 21st century talent management.

The idea of a strategic plan ‘suspended in aspic’ guiding the organisation in a world where macroenvironmental disruption rains down on the organisation with the volume, variety and intensity of a cyberattack is quaint, almost amusing, but mercifully a shorted lived experience.

So an emergent strategy is needed. Again it will have limited success if it is overlaid onto a static, process-driven, factory model organisation. Emergent strategy needs an organisational redesign. In plain sight, living systems offer us the way forward.

If this feels familiar, I’d be interested to hear how it’s showing up in your organisation.