Is your strategy adaptable?

Your strategy is adaptable if it:

• Clearly separates your strategy from your strategic planning AND
• Has built-in resilience AND
• Is agile.

Discover below:

• Key advice and actions to improve the adaptability of your strategy.
• Questions to ask to prompt deeper conversations on strategy adaptation across your organisation.
• Strategy models relating to adaptability.
• Strategy workshops.
• Links to our full range of resources, including ‘The Strategy Manual’, our Strategy Glossary and links to articles and posts by Mike Baxter.
• We also offer consultancy and advice on all aspects of strategy.

Key advice and actions

Your strategy will be adaptable if is separated from your strategic plan, strategic opportunities and threats are identified, prioritised and prepared for, and you respond in agile ways.

1. Separating strategy from strategic planning.

Strategy adaptation occupies most of the lifespan of a strategy. It is important to understand that what you are adapting is actually the strategic plan, not the strategy itself. A strategy is a compelling vision of the future. It is about the destination we seek and the path we choose to get there. As such, it should be resilient in the face of changing circumstances. A strategic plan, on the other hand, is a programme for transformational change that needs to adapt and evolve.

Your strategy continues to provide clarity of direction throughout the strategy lifecycle, whilst strategic planning can adapt to changing circumstances through goal delegation, goal prioritisation, risk assessment and target-setting. The Separation Model of Strategy can be used to demonstrate the different roles that strategy and strategic planning play, and the purposes they serve.

As soon as the strategic plan has been adapted so much that it no longer reflects the strategy, that’s the time for a new strategy.

2. Identifying strategic opportunities and threats.

Strategy adaptation comes about by building resilience (the ability to withstand challenges or recover rapidly and fully from them) and agility (the ability to adapt swiftly by means of innovation).

Strategic risks arise out of uncertainty. Strategy adaptation needs to identify risks, understand the underlying uncertainty, and decide how to mitigate any harm or exploit any opportunity arising from that uncertainty. The Strategic Risk Model and Strategic Risk Register can be used to analyse and describe strategic risks, to identify the underlying uncertainty that a risk introduces and then explore the potential harm and exploitable opportunities available as a result of that uncertainty.

There are different types of strategic risk:

1. Marketplace risks, such as risks from your competitors or the changing needs of your customers;
2. Remote risks, that may seem distant threats in your operating environment but can have significant effects on your strategy;
3. Knock-on risks, that are triggered by events in your operating environment that have no direct impact on your strategy at all;
   
4. Internal risks, from inside your organisation;
   
5. Emergent risks, that arise from the changes brought about by strategy.

A further critical issue in building any type of strategic adaptability is understanding and anticipating the future. Two techniques that can be used to do this are:

1. The Futures Cone, which looks at the likelihood of events happening in terms of whether they are projected, probable, plausible, possible or preposterous.
   
2. VACU Analysis, which represents the Volatility, Ambiguity, Complexity and Uncertainty of an issue as a continuum of decreasing understanding and increasing unpredictability about the future.

3. Prioritising strategic risks

Prioritising strategic risk can be achieved by analysing the features of risk: likelihood of occurrence, significance (defined as severity of harm and value of opportunity) and the adaptability of your organisation in response to the risk. The Prioritising Risk for Strategy Model (PRiSM) scores the features of risk to give a Risk Priority Number (RPN).

4. Adapting to strategic risks

Adapting to risk requires three key activities: sense-making, decision-making and change-making. These activities are built upon a foundation of three adaptive capabilities: surveillance capability, commitment capability and responsiveness capability. The Pyramid Model of Strategy Adaptation can be used as a systematic framework for both thinking about strategic agility and resilience, and building agile/resilient capabilities around strategic risk.

Let’s talk about … strategy adaptation

Use these questions to prompt deeper conversations* on strategy adaptation across your organisation:

• How well is your organisation able to adapt your strategy? Is this good enough? Would it be better if you had more or less adaptability?
• Are the concepts of resilience and agility well understood across your organisation? How good would you say you are at building strategic resilience? And how good at being strategically agile?
  
• Do you have processes in place to think about, and plan for, future opportunities and obstacles? How effective do you believe them to be? How could they become more robust?

*Download a pdf with some helpful rules (suggested by Ed Morrison and colleagues in their book Strategic Doing) to ensure successful conversations about strategy.

Want to know more?

Discover below the strategy models and workshops that can improve the adaptability of your strategy, or see our full range of resources, including 'The Strategy Manual', our Strategy Glossary and links to articles and posts by Mike Baxter.

We also offer consultancy and advice on all aspects of strategy - find out more about how we work.

Our strategy workshops and models are colour-coded  under the following themes:

Strategy models to ensure your strategy is adaptable:

Strategy workshops to ensure your strategy is adaptable:

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