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Modern strategy is a language, not a plan.
The age of old school strategy is over. Today, strategy is a language for the organisation, designed to allow it to realise its…
The age of old school strategy is over. Today, strategy is a language for the organisation, designed to allow it to realise its ever-changing potential.
By Mark Wilson, Founder Partner, Wilson Fletcher
A while ago now I attended an event with the charming folks over at the Future Strategy Club where the central question was “what the f*ck is strategy?”. It’s a question that’s been asked many, many times over the years of course, and only a fool would try to answer it conclusively.
So here goes.
Take it as read here that I believe that organisation-led strategy is a relic of the pre-digital era. Service-led strategy is the way things should be done today, but you can read about that elsewhere.
After that FSC event, I reflected for some time on what it was that had really changed about how we approach strategy today compared with the Michael Porter/McKinsey era. Then, armies of business consultants would descend on the organisation to analyse every aspect of operational performance and work with the leadership team to produce ‘a strategy’; one it would ‘follow’ or ‘execute’.
Strategy was, in essence, a multi-year plan, built on a set of internal operational inputs and external competitive analyses. It was conducted top-down and largely inside-out.
In the course of our work at WF, we still see a lot of these, and there are probably thousands being developed this very minute by organisations around the world. This model is still the go-to approach for most people, but it’s really not fit for purpose in the digital economy.
Traditional strategy focuses on the wrong central component: on achieving sustainable competitive advantage. Modern strategy recognises that in the digital economy, sustainable advantage is a dead concept. Projecting years ahead is a fallacy, in conflict with the incredible fluidity of today’s world. Strategy has to focus instead on each organisation’s ability to realise its competitive potential.
That’s because potential is the commercial currency of the digital world: potential market, potential audience, potential connections, potential impact, potential to make the previously impossible possible, or the previously arduous, easy. Competitive advantage for today’s organisations is based on their ability to capitalise intelligently on emergent customer-facing opportunities. In other words, on the ability to realise potential.
This means that modern strategy can no longer be an analysis and a plan. It should be thought of as a language. Languages have a clear cultural foundation (e.g. English); they’re built using a clear set of rules that allow broad flexibility while maintaining coherency (grammar); they use an evolving set of assets (vocabulary); and they’re inherently bi-directional (conversation).
Now apply this to a modern organisation. The organisation’s purpose defines the nature of the language. A set of strategic principles ensure that what the organisation does always aligns coherently with its purpose while allowing it to constantly interact with customers and innovate in the services it engages them with.
Perhaps this is why we see organisations with a clear purpose and strong culture winning out; the people in them inherently know how to use the strategic language to best effect. The flexible but tangible framework that the language provides frees them to spot potential and empowers them to capitalise on it. And, it gives them license to do so more creatively and bravely than a fixed, dictated plan could.
So, to try to answer ‘what the original what the f*ck is strategy?’ question in a pithier way: Strategy is the language an organisation uses to realise its competitive potential.
Whether my definition is elegant enough is more than arguable, but this does seem to be a viable definition of the approach taken by the upstarts — the elite of the digital economy — and certainly feels more aligned with the outcomes of our own work helping organisations to succeed in a digital economy that is subject to constant change and a continuous flow of new potential.