As usual, I am on the same wavelength as both of you.
The strategy problem is just a symptom of the greater problem of eliteness in modernity. Elite people want to learn tools that separate them from the masses, which has been around for a long time. Priests loved it when their tool was Latin and the masses couldn't understand what they are saying. Made them more powerful.
Same thing today. If you learn a set of analytical tools that most don't know, you can feel powerful by telling people who you think as lesser that they are in fact lesser and should listen to you.
And they perform your 'certainty theater' (like your term) and tell those people who object that they are objecting only because they are lesser.
But I think it is coming to an end - or at least a retrenchment. But if business schools don't get the picture, they are going to destroy themselves.
I've been thinking a bit more about this. How we got here, and what to do. Even at BCG, the org that invented business strategy, actual strategy projects are rarer and rarer. And I think it's because the strategy consulting firms' ambition of broadening the meaning of "strategy", in order to sell more and more projects as strategic, led to a form of "Gresham's Law of Strategy".
If the strategy consulting firms had insisted that "strategy is only about creating sustainable competitive advantage," that'd have limited their growth. Operational effectiveness projects? Important, but not strategic. Transformation programs? Same thing. By letting strategy be conflated with important, and long-term, and executive, and cross-functional, and deliberate, lots more projects could be sold as "strategic"!
But then, it becomes harder and harder to pin down genuinely strategic choices and thinking. Gresham's Law says that, if lots of counterfeit currency start circulating, bad money drives out good money: people spend counterfeit bills faster and faster, and good money stops circulating. It does feel like some form of this phenomenon has happened to strategy.
My hypothesis is that step 1 for fixing strategy is isolating its strict, definitive meaning. Either driving out the bad definitions or somehow defining a new term for it. I see how you've been trying to do this for decades, Roger, yet executives and advisors strongly resist it... I hope you're right about the retrenchment! It can't come fast enough.
I buy your entire diagnosis, Felipe. And it is going to be a tough road to something better. I guess I think there is going to be a 'premium' market for real strategy - it will be smaller and higher priced. And then there will be a giant market for stuff masquerading as strategy. I don't think that is going to go away because the buyers of that slop can't tell the difference. In the end, it will be the rich getting richer and the poor getting poorer. AG Lafley didn't really need me as a strategic advisor because he knew what strategy was and was very talented. But since he did know its importance, he wanted to be better still. And P&G got richer. Same with Jorgen Vig Knudstorp at Lego.
Verizon is a great such story. Lowell McAdam was an excellent CEO but he wanted to have the best strategy possible and he worked closely with me until his retirement - at which time VZ was on top by far and had the leading market cap to show for it. His successor had no idea what strategy was and employed a head of strategy who didn't either. He tanked the market position and the market cap - they trail AT&T and T-Mobile now. And he got sacked. He needed me infinitely more than Lowell did. But he had no idea that was true. So he got very bad strategy 'help' and 'advice.' And all employees, shareholders and customers suffer.
I don't know how we are going to overcome this adverse selection process.
The future of strategy won't come too soon for me.
Yesterday I saw a few job postings for strategy directors whose role was described as collecting data, analysing data, synthetising data (in "sophisticated" financial models) and presenting data (in PowerPoint decks) to the CEO (who seems to outsource the "strategy" to his CSO).
Experience required was a deep knowledge of the industry.
I must add this is typical of what I see weeks in, weeks out.
Another great one, Roger! Made me think of how, in physics, changes in phases of matter need the right temperature and pressure but also a perturbation to kick-start the phase change.
But that’s the domain of “things that couldn’t be any other way.” In business strategy I feel the problem is that we’re already beyond critical temperature/ pressure, AND with lots of perturbation… But we just haven’t found yet the right memetic package that could bring forward this “new strategy.”
I love your suggestions, and yet I keep getting amazed at how many people still misquote/ misinterpret Porter, Christensen, and yourself… So much “certainty theater” being sold as strategy. So many genuinely important priorities being always called “strategic,” no matter whether they’re operating imperatives or strategic choices; so people prioritize urgent imperatives, because the past and present are understandable, and thus take the oxygen out of the room for real choices about the future.
I don’t know. Sometimes it feels like the whole “let’s explain what strategy really is / what it should really be” ship has sailed. Perhaps we should involve the @categorypirates to language a new category into being. It worked alright for Bruce Henderson in the 1960s! 😅
I heard Mr Rumelt say something similar re: naming. He prefers to use the term "action agenda".
So we'd have many consultancies and self-proclaimed experts pretend they do strategy - though they only manage "strategic" (what else?) programmes - and real strategists doing real strategy but not saying it.
Strategy is also very much needed in scientific organizations to assure scientific excellence has impact on society.... We are working on this..., following your work !
What I've always liked about this work is that it doesn't pretend the strategy conversation inside companies is cleaner than it is. Most of it isn't analysis. It's negotiation with things already decided. That's a harder thing to write about honestly.
You inspire us to think, and thank you for that. W. Edwards Deming, a champion of quality management principles, developed two concepts that can be applied to the art of strategic thinking, planning, execution, monitoring and adjustment. They are the Plan/Do/Check/Act (PDCA) cycle, and the concept of Continuous Improvement. Successful use of these concepts can lead to a culture that embraces the positive possibilities of change, and its potential risks, and ultimately resilience and sustainability.
As usual, I am on the same wavelength as both of you.
The strategy problem is just a symptom of the greater problem of eliteness in modernity. Elite people want to learn tools that separate them from the masses, which has been around for a long time. Priests loved it when their tool was Latin and the masses couldn't understand what they are saying. Made them more powerful.
Same thing today. If you learn a set of analytical tools that most don't know, you can feel powerful by telling people who you think as lesser that they are in fact lesser and should listen to you.
And they perform your 'certainty theater' (like your term) and tell those people who object that they are objecting only because they are lesser.
But I think it is coming to an end - or at least a retrenchment. But if business schools don't get the picture, they are going to destroy themselves.
I've been thinking a bit more about this. How we got here, and what to do. Even at BCG, the org that invented business strategy, actual strategy projects are rarer and rarer. And I think it's because the strategy consulting firms' ambition of broadening the meaning of "strategy", in order to sell more and more projects as strategic, led to a form of "Gresham's Law of Strategy".
If the strategy consulting firms had insisted that "strategy is only about creating sustainable competitive advantage," that'd have limited their growth. Operational effectiveness projects? Important, but not strategic. Transformation programs? Same thing. By letting strategy be conflated with important, and long-term, and executive, and cross-functional, and deliberate, lots more projects could be sold as "strategic"!
But then, it becomes harder and harder to pin down genuinely strategic choices and thinking. Gresham's Law says that, if lots of counterfeit currency start circulating, bad money drives out good money: people spend counterfeit bills faster and faster, and good money stops circulating. It does feel like some form of this phenomenon has happened to strategy.
My hypothesis is that step 1 for fixing strategy is isolating its strict, definitive meaning. Either driving out the bad definitions or somehow defining a new term for it. I see how you've been trying to do this for decades, Roger, yet executives and advisors strongly resist it... I hope you're right about the retrenchment! It can't come fast enough.
I buy your entire diagnosis, Felipe. And it is going to be a tough road to something better. I guess I think there is going to be a 'premium' market for real strategy - it will be smaller and higher priced. And then there will be a giant market for stuff masquerading as strategy. I don't think that is going to go away because the buyers of that slop can't tell the difference. In the end, it will be the rich getting richer and the poor getting poorer. AG Lafley didn't really need me as a strategic advisor because he knew what strategy was and was very talented. But since he did know its importance, he wanted to be better still. And P&G got richer. Same with Jorgen Vig Knudstorp at Lego.
Verizon is a great such story. Lowell McAdam was an excellent CEO but he wanted to have the best strategy possible and he worked closely with me until his retirement - at which time VZ was on top by far and had the leading market cap to show for it. His successor had no idea what strategy was and employed a head of strategy who didn't either. He tanked the market position and the market cap - they trail AT&T and T-Mobile now. And he got sacked. He needed me infinitely more than Lowell did. But he had no idea that was true. So he got very bad strategy 'help' and 'advice.' And all employees, shareholders and customers suffer.
I don't know how we are going to overcome this adverse selection process.
Best
Roger
Well, all we can do is show the way and hopefully some will ask what’s different with us
Lots of lessons here for "Chief Strategy Officers", who by your definition should not really deserve that title as functional heads in organizations.
The future of strategy won't come too soon for me.
Yesterday I saw a few job postings for strategy directors whose role was described as collecting data, analysing data, synthetising data (in "sophisticated" financial models) and presenting data (in PowerPoint decks) to the CEO (who seems to outsource the "strategy" to his CSO).
Experience required was a deep knowledge of the industry.
I must add this is typical of what I see weeks in, weeks out.
Sigh...
Another great one, Roger! Made me think of how, in physics, changes in phases of matter need the right temperature and pressure but also a perturbation to kick-start the phase change.
But that’s the domain of “things that couldn’t be any other way.” In business strategy I feel the problem is that we’re already beyond critical temperature/ pressure, AND with lots of perturbation… But we just haven’t found yet the right memetic package that could bring forward this “new strategy.”
I love your suggestions, and yet I keep getting amazed at how many people still misquote/ misinterpret Porter, Christensen, and yourself… So much “certainty theater” being sold as strategy. So many genuinely important priorities being always called “strategic,” no matter whether they’re operating imperatives or strategic choices; so people prioritize urgent imperatives, because the past and present are understandable, and thus take the oxygen out of the room for real choices about the future.
I don’t know. Sometimes it feels like the whole “let’s explain what strategy really is / what it should really be” ship has sailed. Perhaps we should involve the @categorypirates to language a new category into being. It worked alright for Bruce Henderson in the 1960s! 😅
I heard Mr Rumelt say something similar re: naming. He prefers to use the term "action agenda".
So we'd have many consultancies and self-proclaimed experts pretend they do strategy - though they only manage "strategic" (what else?) programmes - and real strategists doing real strategy but not saying it.
It's a mad, mad, mad world
Strategy is also very much needed in scientific organizations to assure scientific excellence has impact on society.... We are working on this..., following your work !
What I've always liked about this work is that it doesn't pretend the strategy conversation inside companies is cleaner than it is. Most of it isn't analysis. It's negotiation with things already decided. That's a harder thing to write about honestly.
You inspire us to think, and thank you for that. W. Edwards Deming, a champion of quality management principles, developed two concepts that can be applied to the art of strategic thinking, planning, execution, monitoring and adjustment. They are the Plan/Do/Check/Act (PDCA) cycle, and the concept of Continuous Improvement. Successful use of these concepts can lead to a culture that embraces the positive possibilities of change, and its potential risks, and ultimately resilience and sustainability.
This article need to be printed and placed in front of all CEOs and Managers in the World.
Thank you Roger for showing how to fix Strategy, the world truly needs it.
Have a great week!
Excellent piece,
It is antithesis to the establishment, although it is a fact.
Would like to expand on "Nurture your imagination " part.