Why do senior managers and directors avoid strategy?
In a recent blog – “How Strategy Really Works – My Three Cs” – I discussed my views about what makes good strategy. Understanding Customers, Beating Competitors and Being in Control. I thought that provided managers understood these three principles, the pathway to developing good strategies was clear. Understand the principles, develop your strategies around them.
However, recently I have started to reflect. Understanding the three Cs is not the start of the strategy journey – more the middle or even the end. Discussions with senior managers with whom I work and those attending my Executive MBA classes have got me thinking. A fairly consistent theme is developing. The theme is that strategy is either for somebody else or so poorly developed that it’s best to nod in agreement and hope it will go away!
So let’s have a look at some of the issues which contribute to senior people hoping that “strategy” will disappear or go away.
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Strategy is too nebulous for real managers!
It’s the stuff of MBAs – we need to get on with running the business.
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I’m too busy to think about strategy.
Pressure is always on sorting out tomorrow’s (or today’s) issues. Meeting the here and now, today’s budgets or putting out the fires. Interestingly, managers tend to like trouble shooting, whatever they tell us. Short term praise hides the reasons for the fire!
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We do strategy. Just take a look at our latest business plan!
Business plans! They start as some sort of best intention strategy paper but pretty soon take on a life of their own, adding incrementally year on year – typically budget and sales forecasts, but certainly not strategic reviews. But that’s okay. If a senior manager produces a big enough business plan then he or she can be pretty confident that nobody will want to read it and certainly not comment on it (or even understand it!).
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And what about the Strategic Planning Directorate?
I’ve seen so many large organisations where the office of the Strategic Planning Directorate (typically on the top floor) is a place to be feared rather than revered and rarely actually contributes to strategy. I discovered this a few years ago when I asked a strategic planning director to give a talk on company strategy to one of my MBA classes. The director declined saying she didn’t really know that much about strategy and certainly wasn’t confident enough to say anything in front of a class of ambitious managers! So if you don’t know much about strategy, how can you become a strategic planning director in charge of a strategic planning directorate? It’s quite easy really. Because your role is not to take the organisation forward but rather to make sure that the detailed business plan (yes, that plan!) is put into action through a series of KPIs, metrics, tick boxes, sign offs and so on. It’s in the interest of strategic planning directorate to make sure that few managers actually understand strategy. If they did they’d be able to see the ever expanding documentation for what it is. Strategic planning directorates are gatekeepers rather than innovators. Their job is to keep everyone on their toes or to put it another way, make sure that people become so scared about not ticking the right boxes that the actual reasoning behind those boxes – “the strategy” – is quickly forgotten.
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We did strategy on our last away day…but it didn’t work.
For many senior managers strategy is all about the “away day”. Let’s get everybody into a big conference room and do some cutting edge “brainstorming”. This rarely results in anything meaningful. Everyone knows nothing will happen. There’ll be a huge wish list at the end of the morning, the result of lots of flipcharts and post it notes. But have we the energy to deal with the wish list? Well not by the time that big lunch (the other reason for the away day) is over and our focus is on that 5 o’clock finish. But at least we’ve got that over with for this year.
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But it doesn’t have to be like this. I spend quite a lot of time working with senior teams and once we’ve got rid of all the “noise” around strategy and focused on what really matters – customers and competitors – it’s amazing how quickly they start to engage. I recently facilitated a board strategy day. A few weeks later the chairman told me that the 50 page business plan had now been reduced to 5 and, here’s the interesting thing, the business became more focused and more successful.
Does any of this ring true to you? Quite possibly. Is any of this a lightbulb insight? I doubt it. Yet it goes on year after year. Strategy is about the future of the organisation, getting to the issues which really matter, working out what needs to change. At Market Echoes we have a very simple way of working with senior managers. For one day, maybe a day and a half. No more. It’s about getting to the heart of issues, getting rid of all the documentation and working out what the company really needs to do to change for the better. It’s actually about less is more rather than more is best. And it’s certainly not about functions whose title let alone activity is enough to send us to sleep, enough to encourage us to avoid strategy.
Have you got stories to share on strategy? Are you a strategic planning director and want to defend your cause?! Would love to hear from you.
Comments
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Excellent article Julian!!
Dear Salman
Thanks for your feedback.
Regards
Julian
Dear Julian,
You were a great help when I was chairman of Bethany School. After our away day in Eastbourne we developed a decent and workable strategy document – a first for Bethany and I reckon one of our most important achievements. Many thanks.
Dear Andrew
Many thanks for your positive comments.
Regards
Julian
Julian,
Good observation.
I think your points involve something very simple and that boils down to an inability of people in positions of “power/responsibility” unable or unwilling to make a decision.
Too often it is done by committee or the overwhelming conflicts between stakeholders leads to the most sensible low risk course of action – No Decision and limbo continues in the belief that the status quo actually is a straight line (Parmenides Fallacy shows why this is bad!).
To make a decision requires strong leadership but fundamentally the ability to make a decision based on the clarity of the stated goals of the company, it’s values, mission and where it wants to be – what it wants to achieve and what it can actually achieve.
This is where strategy falls over – companies are confused about what they are and where they want to be and as such decisions are difficult – basically impossible – to make as they cannot be assessed by any end goal or within any framework.
Your mantra is correct Julian – less is more. Strategy is about rapid deployment and rapid reassessment, then rapid adjustment.
Hi Tim
Thanks for your comment.
I think you are correct – strategy has so much “noise” around it that it just is an ever increasing turn off or nothing to do with strategy at all.
Regards
Julian
Dear Julian,
Very interesting article and yes, it does ring true. Especially the obsession with ever more detailed business plans which document exactly what the future – short and long – will not look like – which can also be somewhat useful. Unfortunately often the environment of a business, like investors, etc. request them and the longer and more detailed the better…
Regards
Rene
Hi Rene
Thanks for your comment.
We all know that ever longer business plans don’t add value…yet as you say they appear to be expected by the same investors who say “be more focused” when trading is difficult!!
Regards
Julian
Dear Julian,
Very insightful article! It’s all about short term goals to maximise shareholders return & all strategies are made to achieve that goal! It’s a matter of survival for the senior managers & directors. So they do have some strategies in place!
Dear Girish
Thanks for your comments. Yes – managers do have strategies, but perhaps not the most important ones.
Regards
Julian
Dear Julian,
Thanks for sharing. Very useful insights. Indeed, strategy should focus on what matters and easy to understand by everybody because it will support decision making.
Useful insights for my management project. Thanks again.
Dear Mayra
Thanks for your comments.
I like your words – “what matters” and “easy to understand” – it’s a pity that so many strategies don’t focus on these.
Regards
Julian
Dear Julian
Excellent article. It is very practical and almost all organisations go through this. In our organisation, we are backed up by a strong Governance team which ensures follow up of bullet points/ tasks / projects as discussed in strategy meetings. Having an independent, strong, empowered governance team who report directly to the higher ups will help. We have seen a big difference, strategic discussions are not limited to only white board or flip charts. They lead to concrete actions and follow ups.
Hi Neeraj
Thanks for your comments.
If your system actually results in getting things done then that’s great. And if what gets done is really strategic then that’s even better.
Regards
Julian