Strategic Thinking - The Role of Formal Planning versus Organizational Learning
- Strategic Principles include both current, fixed elements that precede strategy formulation (mission) and future, variable elements that precede, evolve with and are used to communicate after strategy formulation (vision).
- Strategy Formulation includes more than just analysis and planning – new insight generally requires an intuitive understanding of the business that is only achieved with long term organizational learning. The people most likely to have the experience and creativity to see new business approaches are often deep in the organization closest to the customer and internal business processes.
- Strategy Implementation is not just an exercise to convert the strategy into action plans. It must also engage a broader group of employees (ideally done during strategy development) and provide direct feedback into both corporate vision and strategy formulation.
A more complete model allows the Vision to develop and mature throughout the Strategy Formulation and Implementation phases. It also recognizes that strategy involves both scheduled (planning) activities and evolutionary (organizational learning) aspects. Once we see strategy from this perspective – “Strategic Thinking” becomes the objective for a robust corporate strategy process. Strategy creation is no longer an annual event but a long term process that has both non-linear and re-entrant elements. Strategy is no longer the exclusive domain of senior executives but must incorporate the best business intelligence (from those close to the information source) and the most creative minds (those not yet biased by established industry practices).
In order to harness the insight and creativity of a broad cross section of employees – the technique of strategy focus teams has proven effective. These teams are composed of mid and lower level people with direct customer contact and/or business process insight. They report to the executive strategy committee but must also maintain a high degree of independence to encourage new ways of thinking about the business. This requires a unique mix of strong executive support yet minimal executive influence. The CEO in particular must endorse a more democratic and inevitably more critical approach to understanding the business and creating new approaches. For those executive teams that have sufficient discipline and self-confidence, the application of a broad “Strategic Thinking” process can yield exceptional new insights.
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