Distillations in this newsletter: How to think big in strategy; ‘Care’ as a big thinking theme for strategy; wise words on strategy from Professor Susan Lea.
A monthly concoction of insight, learning and things you might have missed for anyone who works on strategy, works with strategy or just loves strategy.
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This month …
- How to think big in strategy.
- Strategy snippets you might have missed: ‘Care’ as a big thinking theme for strategy; wise words on strategy from Professor Susan Lea.
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How to think big in strategy
Inertia. Narrow-mindset. Risk-aversion. Isn’t strategy meant to overcome these kinds of entrenched ‘small-thinking’? Whilst leaders might debate just how big they want their strategic thinking to be – what might be thought of as transformation by one leader might be seen as a reckless bet on the future by another – few would disagree with the need to think big. Bradley, Hirt and Smit’s book ‘Strategy beyond the Hockey Stick’ suggests that:
- The critical success factor in strategy is to make big moves, focusing resources in a limited number of places where they will make most difference.
- In general, making no bold moves is probably the most dangerous strategy of all.
But, how do we think big, strategically? There are three ideas we’re going to explore here that can help at different stages of strategy scoping and development:
- Principled (as opposed to constructed) strategy;
- Grand challenges;
- Grand strategy.
This one, surprisingly enough, comes from Albert Einstein. Writing in a letter to The Times newspaper in 1919, Einstein explained how to distinguish different kinds of theories in physics. Most theories, he suggested, are ‘constructive’. They attempt to build up a picture of the more complex phenomena out of the materials of a relativity simple formal scheme from which they start out. The kinetic theory of gases is one such theory. It begins with the physical, molecular constituents of gas and how they interact. It is from these constituents that the more general theory is built up or constructed. A second class of theories Einstein calls ‘principle theories’. These employ the analytic, not the synthetic, method. They are based on natural processes, which, in physics, are usually mathematically formulated. The science of thermodynamics, for example, seeks to explain how heat, work and temperature interact, given the universal principle that perpetual motion is impossible.
In strategy too, it seems that this distinction between constructed vs principled may be valuable. How often is a strategy constructed to give a semblance of coherence to a disparate array of facts? We are losing market share, we are suffering price erosion and our competitors are launching more new products than we are. So, we need an innovation strategy. That will fix all our woes. Or we have poor staff survey results and high levels of staff turnover, so we need to transform into a talent brand. These are courses of action designed to resolve a particular construction of the challenges faced by the organisation.
By contrast, a principled strategy would focus on some of the ‘natural processes’ shaping the organisation. One obvious way to do so is to base strategy on the ‘lived’ values within the organisation (learn more about values-based strategy in my recent book ‘Core Values’). So, your strategy could be built around your sense of community, your customer-focus or your agility in response the changes in your market.
‘Grand challenges’ are difficult but important problems, defined to stimulate focused, collective and collaborative effort by a wide range of individuals and organisations on solving those challenges. From their origins in finding solutions to unsolved mathematical puzzles to resolving key global health problems and sustainable development, grand challenges are fundamental in their need to capture both imagination and support. For strategy, adopting the notion of grand challenges enables you to ‘think big’ by identifying the greatest needs of your organisation that will both inspire and align all those involved in meeting those needs.
In his recent book, The Crux, Richard Rumelt suggests that the crux of any strategy is to identify the most important challenges facing the organisation that are addressable and likely to be resolved by coherent action. Identifying and prioritising challenges is, therefore, a great starting point in the development of any strategy.
A challenge can be an opportunity or a threat, an aspiration or a driver that can help you scope out your strategy. Here are some common examples in strategy:
- Increase our profit margin;
- Become market leader in our sector;
- Reduce our staff churn;
- Respond to forthcoming Government regulations on x;
- Reduce the carbon footprint of our transport fleet;
- Increase the range and quality of our marketing output.
To ‘go grand’ on a given set of strategic challenges is to ask if they are a component part of a bigger issue, a symptom of a greater cause or an aspect of a broader trend. If they are, would the strategy be better to focus on the grand challenge? To run through our examples again:
- Should we aim to be more effective and efficient as an organisation and use profit margin as one measure of success?
- Should we aim to be more competitive and use our rank in market leadership as one measure of success?
- Should we develop a more employee-centric culture and use staff churn as one measure of success?
- Should we aim to be more resilient and use our ability to respond to regulatory change as one measure of success?
- Should we become more environmentally sustainable and use our carbon footprint as one indicator of progress?
- Should we aim to lead our competitors in ‘share-of-mind’ in our key customers, and use the range and quality of our content output as one measure of success?
The concept of grand strategy has military origins. Where a strategy would set out how to undertake a battle or a campaign, grand strategy would define how a nation sets out to achieve it national interests, including by armed conflict. So grand strategy would determine how to allocate resources amongst various services (including military), how to support various types of manufacturing (including armaments) and which international alliances to enter into (Wikipedia).
More generally, grand strategy can be thought of as ‘higher strategy’ and a simple way to make sense of it is to think of corporate strategy being higher than the business unit strategies across the corporation; or organisation strategy being higher than the functional strategies of departments within the organisation.
To use the concept of grand strategy to help you think big, strategically, you must ask yourself if your current thoughts on strategy are actually a component part of something more long-term, something broader or more expansive, something deeper and more insightful. Are your current thoughts on strategy actually the sub-strategy that sits under a grand strategy?
In a way the thinking process is similar to the one just described for grand challenges. I, however, tend to use them as separate ways of thinking big because they apply at different stages of strategy development. It is useful to think of grand challenges early in strategy development, as the ideas underpinning your strategy are starting to coalesce. Grand strategy applies much later as your strategy is beginning to take shape.
Similar tools and processes can, however, be used for both. Here are two that I use:
- Strategy mapping – by teasing apart the why:how logic connecting the goals within a strategy, you can keep asking why to get to grander challenges and grander strategic ideas.
- Root cause analysis – this sets out to systematically prevent and solve underlying issues rather than just treating ad-hoc symptoms.
You can use the notions of ‘principled strategy’, ‘grand challenges’ and ‘grand strategy’ to help you ‘think big’ about strategy. This is not to say that you will lose focus, rather that you will challenge the inertia, narrow-mindset and risk-aversion that can often leave strategy as a small step towards tweaking ‘business-as-usual’ rather than the transformational change that moves your organisation forward and takes everyone along with you.
Strategy snippets you might have missed …
‘Care’ as a big thinking theme for strategy
It was as I pulled together my ideas on big thinking in strategy that I bumped into the concept of ‘care’ in a number of different contexts. Inevitably I started wondering if this was a useful big thinking theme to apply to strategy. Potentially, I could see it applying in several different ways. Customer care sounds like a more purposeful theme than customer experience. Caring for employees may be a good theme to anchor a people strategy to. And maybe caring for all stakeholders is fundamental to the new stakeholder capitalism movement.
For anyone wanting to explore the concept of care in more depth, here are two good resources on the principles of care:
- The Internet Encyclopedia of Philosophy’s entry on ‘Care Ethics’;
- Boris Groys’ 2022 book ‘Philosophy of Care’.
And here are two books on how the concept of care has been used to drive political change:
- The Care Collective’s 2020 book ‘The Care Manifesto: The Politics of Interdependence: The Politics of Compassion’;
- The Boston Review’s 2020 book ‘The Politics of Care: from Covid to Black Lives Matter’.
Wise words on strategy
Professor Susan Lea’s reflections on turning around a struggling university included these wise words:
- “Strategy needs to be parsimonious, distinctive, memorable and well-socialised”;
- Delivering strategic success requires ”dialogue, decision and delivery”;
- “Taking people with you is a sine qua non of leadership”.
Goal Atlas gives you structured processes and tools to ensure strategy is adopted and impactful across your organisation. Get in touch if you think we might be able to help.
If you enjoyed reading this newsletter, don’t forget to forward it to friends or colleagues who might also find it of interest.
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Discover the content of past issues of Strategy Distilled.