Strategy is a perplexing topic. Written about and discussed much, and yet poorly understood. Seemingly scientific and complex in process and analysis, yet it is often the gut driven and elegantly simple strategy that is most effective. Decried as absolutely essential for business success, yet some firms succeed without it… or do they?
As the authors of The Rise and Fall of Strategic Planning, Strategy Safari and other seminal works, Mintzberg and his colleagues know strategy well enough to poke fun at it in Strategy Bites Back. On one hand they treat the topic with scholarly respect; on the other hand they dismiss it as nearly useless. But what is the truth? Is strategic planning a core foundation to business success, or a phenomenal waste of time and consulting fees? The answer is somewhere in the middle.
Based on more than a decade of teaching and consulting on strategy here are a few of my random thoughts:
Most companies believe that strategic planning is important; very few understand it or do it well.
Senior executives complain to me constantly that their people are not good strategic thinkers; but do not invest the time or resources to help their people become good strategic thinkers (which is extremely difficult indeed).
Most people severely over-analyze when trying to create strategy, attempting to divine the unknowable and blueprint the future. (Not going to happen)
Much of what passes for good strategic theory is just that… theory. Never tested, far too complex and certainly not realistic for implementation in the actual business world.
Even though some companies create absolutely superb strategic plans, only a precious few execute to plan.
Let me back up that last point. I was recently invited to the Wharton School of Business to present a class on strategy to a large group of senior executives and posed this question: What percentage of the time do you think that companies that have developed a good, solid, realistic strategic plan… are actually effective in implementing that plan? The answer: 10% …MAYBE.
Now that I have focused on the negatives, what can be done to improve strategy?
First, realize that it takes a great deal of time, study and effort to be a good strategic thinker. Next, remember that clean, focused, as simple as possible and extremely well communicated are the keys to building an effective strategy. And lastly, even the best strategy in the world is completely useless without an incredible level of disciplined execution.