Strategy can a troublesome topic. Here we identify 6 key problems with the traditional approach to strategy. The objective is to build the case for a new approach.
1. High Rates of Failure
Strategy should be all about success – as in all about ensuring the success of the organization (business unit, department, project or team). But it is not. Indeed, strategy has traditionally had more in common with failure than success. That is because of the simple statistic – evident from countless research studies – that put the failure rate of strategies at up to 90%.
The failure rate of strategy should come as no surprise – it has been discussed for more than 20 years. For example as far back as the 1990s leading strategy gurus were publicizing the death of strategy.
The problem is that even good strategies fail. In other words strategies that are well thought through, perhaps even visionary, regularly fall. Indeed, many fall at the first hurdle – that is implementation.
2. Strategy & Cynicism
Experiences with promising strategies failing to deliver have lead to a deep cynicism regarding strategy. This is reflected in the following narrative:
3. Strategy & Reality
To understand why this happens we have to review the traditional approach to strategy creation. That is where strategy is set by one or a handful of senior leaders. Strategy often has its head in the clouds and more often than not it fails to come down to earth.
4. Strategy & Confusion
There is no easy answer to the question ‘what is strategy?’ Indeed, almost everybody has their own interpretation as to what it means.
Strategy is a confusing subject. But if people cannot agree on what strategy is then how can they agree on the strategy for their business.
5. Strategy & Speed
There is one thing that most people would agree on with respect to strategy – that it is slow. Slow to devise, implement, adapt and ultimately to succeed. That is one of the reasons why it is often compared to chess.
Accepting strategy is slow is a limiting belief. In this age of accelerated change the advantage goes to the most agile. So wouldn’t a racing car be a better icon for strategy than chess?
6. Strategy & Agility
Fast markets require fast strategies. Companies must be able to speedily adapt to changing competitors, customers and technologies if they are to win.
Traditionally it was held that once the strategy was developed it should be adhered to rigidly. Strategy was like a railway track it allowed for little deviation. The problem is that even if the strategy was right at the time of creation, it can quickly be invalidated by a change in the market. Today a great strategy leaves room to maneuver, adjust and most important of all to; learn. The strategy is the road side barrier, not the railway track.
