Operating inside an organization without a strategy can be tough. Here’s how to bring strategic thinking into your own work.
Strategy, in the business context, deals with a set of choices and subsequent selection of an execution path, based on the expectation that the selected path will lead to a desirable outcome (profitability, market share, etc.). Strategy answers the question “What shall we do next?” And that’s no small question. A firm’s strategy should provide informed direction to the firm and enable the firm to measure its progress against its objectives.
As important as a strategy is to the growth and wellbeing of a company and its employees, many firms struggle with creating a logical strategy, communicating that strategy to its stakeholders, and subsequently executing on it. There can be many pitfalls along the way and so, unfortunately, many large companies muddle along with no discernable strategy. This is a shame, because choosing a strategy and communicating it broadly makes everyone’s life better. A strategy acts as a guide and touchstone, providing the means to judge the multitude of decisions that a company collectively must make everyday.
Companies with no discernable strategy are often older and benefit from barriers to entry created by regulation or investment size required to enter the market. It could be argued that these firms are employing a strategy to maximize value from these barriers, but in most cases these barriers are an accident of history and the firms in question typically show little interest in developing new sources of competitive advantage. I would argue that these types of firms have no strategy. This can be a dangerous situation, given that it leaves the question, “What shall we do next?” mostly unanswered.
So how do you know if you are inside an organization without a strategy? Here are a few signs of a firm with no strategy.
- Organizational focus on operational effectiveness (e.g. cost cutting initiatives) or acquisition of rivals
- Key objectives are poorly defined which leads to long (or possibly never-ending!) decision making cycles
- Prioritization of resources for competing initiatives is difficult, or worse, doesn’t occur at all
- Unengaged or uninspired workforce
- Low profitability compared to peers
How does one thrive at a firm that has no strategy? Luckily, strategic concepts and thinking are applicable at all levels of an organization, so you can develop a strategic hierarchy for your part of the organization, or even your role as an individual contributor. Setting clear objectives and sub-objectives that tie actions to business results will be powerful when it comes time to make your case for action. Demonstrating a logical set of goals that tie back to the strength and success of your department, and the organization as a whole, will make your argument so much more compelling.
Once you have a hierarchy, spend time thinking through the ways to get feedback on your progress. Do your actions create the expected results? How will you know? What types of systems or processes will be required to detect business impact? Now that you know what actions you will take and how you will measure results, develop an execution plan and get started.
Aside from the negatives of working for a strategy-less firm, you may actually find it easier to choose what objectives to pursue. When a firm’s strategy is unclear, you have more options, as it will be difficult for others to argue that your actions are not strategically aligned. Also, creating a semblance of a strategy, even if just for your part of the organization, will help you differentiate yourself from you peers.
Lastly, keep in mind the importance of culture at a firm with no strategy. In many cases, culture will fill the void where a strategy would normally be the guidepost. Managers in strategy-less organizations will often rely on culture to guide decision making when no strategy has been articulated. Be sure to make your own strategy culturally aligned to avoid unnecessary conflicts.
Although many companies find ways to operate without one, having a strategy is important. It is what makes clear the path forward for your entire organization. Even if your organization doesn’t see the need, you can make sure you have a strategy for yourself, your employees and your department. The success that often follows strategically driven decisions could be enough to turn your entire company onto the power of strategy.