“However beautiful the strategy, you should occasionally look at the results.”
Sir Winston Churchill
Strategic planning has been falling out of favor with business leaders for many years. They either see it as the antithesis of their organization’s agile ways of working or as a slow and painful annual exercise with an outcome that is rapidly overtaken by business reality.
Leaders are right to do so. Strategic planning as we know it has long been obsolete.
This doesn’t mean there is no need for strategic planning. In fact, to successfully navigate through today’s fast-changing and uncertain business landscape, leaders need to engage in it far more often than before.
Strategy as a puzzle
Informed by received wisdom and practice, many leaders have learned to see strategy as if it is a puzzle. That means, it is tacitly assumed that whatever problem the strategy is meant to solve, it is definable and right answers exist. The challenge is thus to find a right answer amid vast amounts of industry, market, and competitor data through the application of sophisticated strategy frameworks and analysis techniques. Improve any, or all, of these aspects and the logic is that a better answer is found faster — even when business conditions change.
If business conditions change, particularly in dynamic, complex and unpredictable ways, as they do in nearly every market today, strategy cannot be a puzzle. Per definition, puzzles have clear cause-and-effect relationships and hence one or at most a limited number of right answers. If answers are contingent on future interactions of known, unknown or unknowable factors, you are faced with a mystery. Treating a mystery as if it is puzzle is like trying to solve the unsolvable. It is impossible. Consciously or unconsciously, many business leaders have realized this and given up on strategic planning.
With the world increasingly offering business leaders mysteries, the best approach to strategic planning is not to give up on it, fly by the seat of one’s pants or adopt a wait-and-see attitude. The cost of failure might be unacceptable — and avoidable. Instead, strategic planning needs to transform into an ongoing, discovery-driven process with the aim of preparing the organization to thrive in the face of uncertainty and deliver on its higher purpose.
This approach is analogous to playing or gaming: learning how to navigate the world and adapt to it without being directly at risk. This is where strategic gaming techniques such as strategic storytelling, scenario planning and business simulations come into their own. These approaches are as old as strategy itself but received wisdom kept them out of many leaders’ sights for too long. It’s time to bring them back into the limelight, or risk moving into the abyss.