Ever since the twin shocks of the world (the COVID-19 pandemic and the oil price shock), there has been an increasing need for individuals and organisations to develop and implement strategies that enable them to thrive in today’s volatile, uncertain, complex, and ambiguous (VUCA) environment. The concept “strategy” has become a buzzword that is overused and flawed to mean concepts that threaten its intended real-world application. As a budding strategy consultant, I felt uncomfortable with this mismatch and resolved to separate the wheat from the chaff as regards strategy.
Structurally, we need to understand what strategy is and why it exists. After all, if we do not convey this, an attempt to demystify strategy lacks a solid base. Without further ado, let us demystify strategy.
What is strategy?
Strategy roots in the Chinese military; specifically, in Sun Tzu’s The Art of War–written in the 5th century BC. However, it was until the 6th century CE that the term “strategy” originated from “strategos”, a Greek word meaning “army leader.” Over time, strategy has evolved beyond military warfare into management, politics, sports, and academia.
Read Also: The Spirit of Strategy
I see strategy as a directional framework of decisions and actions to “optimally” move from “where we are, to where we want to be” in the presence of challenges and uncertainties.
Strategic management scholars Johnson, Scholes, and Whittington, define strategy as “the direction and scope of an organisation over the long-term: which achieves advantage for the organization through its configuration of resources within a challenging environment, to meet the needs of the market and to fulfill stakeholder expectations”.
Why strategy?
Human wants are unlimited, and the resources to satisfy these wants, attain set goals and objectives are scarce. Per Gause’s Law of Competitive Exclusion, no two species that make their living similarly can coexist. In the presence of a slight advantage, one will dominate the other.
Consequently, strategy arose of the need to achieve sustainable, compoundable, competitive advantage. In today’s environment, strategy is more critical than ever as it provides, but is not limited to guidance to entity’s actions, proactiveness and environmental alignment, effective and efficient resource allocation and, a means to competitive advantage.
So far, I presume we understand what strategy is and why it exists. Let us delve into the myths of strategy.
Strategy myths
In this section, we’ll demystify four (4) of the most common strategy myths. They include:
Plan equals strategy: A plan is a scheme of tasks, resources, and activities for specific purposes. As we earlier defined strategy, you might have sensed elements of planning. You are right! Strategy involves planning but goes beyond it and should not be mistaken for a plan.
A strategy has a broad scope that selects the best path(s) to attain ends through enterprise-wide collaboration, adaptation, and innovation to achieve competitive advantage. Ideally, strategy comes before a plan and aligns it towards achieving set goals. Also, it is less flexible and tolerant to alterations as it involves sequencing, estimation, resourcing, and, if need be, revising. “Plan A” will differ from “Plan B” in the event of uncertainties. As plans are offshoots of strategy, so are initiatives and projects to plans.
Strategy is long-term and static: This is widely believed because some traditional definitions of strategy view strategy as a long-term endeavour. The prevalent environment was not as VUCA as it is today; thus, strategies proved effective over the long term. Time is not a factor of strategy; purpose, value-based choices, and trade-offs are.
Due to globalization and technological advancements, our environment has become more dynamic and uncertain than ever. This creates the need for entities to review their strategies as the need arises. Thus, effective strategies are not always static.
In today’s VUCA environment, agility triumphs strategy: Agility is a competence, an enabler, and not a substitute for strategy. Undoubtedly, the COVID-19 pandemic disrupted the world of work. With the availability of digital tools to embrace remote working, organisations require agility to respond to the changing environment. Some organisations are highly bureaucratic, and this reduces the rate of their agility.
Merely being adaptive or responsive to the changes in the environment without the clear direction, choices, and trade-offs that strategy provides will result in misalignment and a waste of resources. Hence, the need to embrace “Strategility” – agile strategy processes.
Strategy is the responsibility of top management: Strategy is at the heart of decision-making. It is not solely a top management responsibility; it is an organisation-wide responsibility. An exclusivity to senior executives creates a lacuna between strategy formulation and implementation, ambition, and performance.
Essentially, there are three levels of strategy: Corporate-level, Business-level, and Functional-level strategy. All members of an organisation need to understand challenges, craft strategies that respond to these challenges, and how they align with the organization’s vision, mission, values, goals, and objectives. I recommended an Office of Strategy Management (OSM) in every organisation.
With appropriate strategies in an enabling environment, I believe-in the near future- we will have a myriad of African companies on the Global Fortune 500 20XX.
Shittu is a Lagos-based, budding strategy consultant with varying interests and experience in the Consumer market, and Energy and Natural Resources Sector. You may contact him throughhttps://www.linkedin.com/in/ismailshittu/.
