Developing strategy is about making choices. There are numerous definitions of strategy. Fighting over the definition is a great way to waste a lot of time, so it’s best avoided. Any definition can start the conversation though. Here’s how we think about it. There are two main conditions that drive the need for strategy – limited resources and competition. ‘Limited resources’ means you don’t have all the money, people, capacity or time in the world. So you have to start with what you have. Competition means there are other organizations that want what you want, whether in the form of the resources or the goals you seek. So no outcome is certain without a struggle. If either one of these conditions is lacking, there is much less need for strategy. But most organizations live under these conditions, so having a strategy is essential.
The most important output from a strategy development process is clear choice. There are a number of things in strategy that require choice. They include products, sectors, customers, technologies, distribution channels, mode of competition, scope of operations, timing, purpose, risk and so on. Choices must be as clear as possible. That means they shouldn’t be couched in fuzzy terms, or come with a series of ‘if’s’ and ‘but’s’. The clearer the choice, the more focused the organization, the more vivid the risk, the more intense the implementation. And to the extent that an organization’s choices can be seen to fit with each other, so they can be said to form a whole strategy.
In one way, the strategy development process is an organizational decision-making process, which is why it can be so difficult, so conflict-ridden and, often, so futile. Getting an answer to your business problem is much easier than getting the organization (or some critical mass of it) to agree on the answer and implement it. Remember, every organization is perfectly designed to get the results it’s getting. So if you want to change those results you’re going to have to change what the organization is doing. That’s the hard part.
