As I began my closing remarks to the MBA business strategy class I wondered: How do you summarise 45 hours of teaching to an MBA class? It’s impossible of course. But just as a eulogy is not a summary of a person’s life but rather seeks to capture the essence of a person’s life, so too I set out to reflect the essence of the challenges on the path to master strategist.
1. Clarity & Coherence. One of the consistent themes in our program is the importance of clarity around your strategic position, and the power of building strategic coherence across the business (exemplars include IKEA and SouthWest Airlines). True alignment delivers what the economists call 'complementarity' wherein success in one initiative delivers increased value from the other initiatives. A stark contrast is the business whose aspiration is to position itself as a top end, niche service provider, but who is simultaneously pursuing opportunities in a much larger, largely undifferentiated market. This is a recipe for failure. Strategy is fundamentally about choice: choosing what not to do is as important as choosing what you will do.
2. Craftsman or chameleon … All businesses face a fundamental tension between refining and finessing their ‘craft’ – adopting Minztberg’s compelling metaphor of the strategist as a master craftsman who achieves success through the relentless pursuit of excellence in his or her chosen craft – or seeking to reposition their business. The complexity of this choice is compounded by the psychological bias towards the status quo: there is strong evidence that decision makers display a strong bias toward alternatives that perpetuate the status quo[1].
3. Innovation occurs at the intersection of disciplines. This is now accepted wisdom in the world of innovation, but it also fundamental to great strategy making. The best strategic thinkers are typically well read across a diverse range of interests. The real creativity from a strategic perspective lay in the ability to make connections and see patterns across the discipline boundaries. The seeds of RTIO’s decade long industry leadership in the adoption and implementation of technology as a core strategic enabler were sown when the executive were willing to ‘allow the outside in’ across multiple dimensions of their business.
4. From routine recipes to deep strategic insight[2]. Great execution cannot make up for second rate strategic insight (I am reminded of the tag line of a strategy consulting group … “when the value of the second best advice is approximately zero”). Too often we hear those ‘in the trenches taking grenades’ complaining about the ever changing business strategy: only occasionally is this due to extraordinary environmental volatility. Leaders need to shift from ritualised strategic conversations in isolation from those who execute to a much deeper level of exchange in which uncertainty and ambiguity are embraced as a fundamental part of the process. Deeper insight at the front end will produce more enduring strategies.
5. Strategy is a fundamentally wicked problem. There are a myriad of strategy models each of which offers a lens into the nature of the challenges and opportunities, none of which is ‘the answer’. Research has shown us that what we need is not better theories, but better practise. Purity of process is much less a builder of strategic capability than the nurturing of competing strategic processes within businesses. Real strategic insight arises from the synthesis of the partial views offered by these multiple processes and models. Or as Gary Hamel once said, perspective is worth 40 IQ points.
In my closing remarks I also recapped the fundamentals of great strategy execution but this is for a later blog.
[1] Hammond et al HBR (1998): The hidden traps in decision making
[2] With acknowledgement to Brian Leavy who’s 2001 Strategic Change editorial title I adapted
