For a board to have this conversation with clarity, a framework of reference is needed. Sadly, many so-called strategic plans we encounter fail to give the board the ability to ask these questions. We have written about this previously, but a recent Roger Martin post prompted some more thinking.

Martin lists his five deadliest strategy myths, and we add to them from our own observations.

The Chesire Cat problem

In a previous post, Martin reminded us of the POSIWID acronym. The point of a system is what it does. We often see people focused on creating world-beating systems as a primary goal. This is like watching a hamster wheel spin faster and failing to note that the power output is constantly falling. 

First, define the results to be achieved. Fail to do this and you are in Lewis Carroll land.
To paraphrase the Chesire Cat, if you don’t know where you are going any road will do. We see this in board reporting—plenty of busyness, but little or nothing on impact.

A list of initiatives is a not strategy

Making a long to-do list of non-stupid things fully within your control is dead easy, according to Martin. Anyone can do that. That’s planning, not strategy. Allocating resources and directing people to do things is simple. 

Influencing those outside your direct control (customers, stakeholders) is hard. Strategy is about addressing the things that must change for you to achieve the desired outcomes. Laundry lists of busyness are not a strategy.

Stupid on its face

Not in this particular Martin list but a favourite of his and something we see all the time. Strategy is a choice between valid options. If the opposite of your option is ‘stupid on its face’ (i.e. at face value), then it’s not valid. ‘We will win with excellent customer service’ is a fine example of this sort of commonplace daft statement—its opposite is to ignore customers entirely, which, taken at face value, is stupid.

The future is unknown

The belief that with enough analysis you can be sure, in advance, that your strategy is correct, is fundamentally flawed. It creates a hesitancy to act. You cannot prove anything about the future. It is a complex web of semi-rational humans interacting, punctuated with occasional random but significant events. As many commentators have observed, even the best plan may not survive interaction with the real world.

Some things about the future can certainly be broadly discerned. People need food; societies need energy. Everyone knows these, but only a few can discern as yet unseen needs. Who knew that we all wanted mobile phones?

Analysts are not strategists

Related to the above comment. Martin argues that the best strategists realise that analytical prowess is a shortcoming to be overcome. The greatest strategists in business history imagine a future that does not presently exist and therefore cannot be analysed. He cites Aristotle: imagine possibilities and choose the one for which the most compelling argument can be made.

Magic underpants

One of our favourites from the wonderful South Park show. Phase one, collect underpants; Phase three, make lots of money. We agree inaction through over-analysis should be avoided but some logic that connects activity and desired outcomes is necessary. 

What challenge/ barrier is this addressing? What need—current or anticipated—is this serving? Or where does this sit against other offerings? With no obvious thinking across these areas, the plan is likely another pointless activity list.

Strategy is a zero-sum game

Martin argues against the simplistic view of winners and losers. His central thesis is working out how to succeed in a particular place (where to play) in a particular way (how to win) that convinces others to succeed in different places in different ways. Replicating and going head-to-head against competitors requires no creativity or imagination. Arguably this delivers the worst results for customers, employees and the communities in which they work.

Strategy is separate from execution

The myth is that the senior team sets strategy and everyone else executes. Here we see a strong alignment between Martin’s idea of cascading strategy and policy-driven governance. In each case, the top level sets a framework that allows each subsequent level in an organisation make to make decisions. The further down the organisation informed decision making can be pushed the better. This empowers employees, giving freedom of choice within their area of expertise and operation. 

The job for a board or top-level strategy team is to create clear frameworks for others to operate within. This will include results to be achieved (ends) and conditions to be avoided (any limits on choice of means). 

Two quotes from Martin sum this up:

What is called execution is, in fact, doing strategy at levels other than the very top of the company.

I have been doing strategy as my profession for 43 years and have never once seen the creature ‘a great strategy that was poorly executed’.

The board’s role

Ultimately the board must know if the strategy it has agreed to is working or not. If the mechanisms to do that are unclear, then they have not done the necessary work. Strategic thinking—making clear what is to be achieved—comes before strategic planning. Then accountability for results can be assigned and the cycle of review and necessary adjustment can be set in place.