Four Ways To Better Understand Strategy
- Brainz Magazine
- Dec 14, 2022
- 6 min read
Written by: William Liu, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
My understanding of strategy has evolved over the last two decades. Early in my career, I remember going over military operational plans and getting utterly lost in an endless number of objectives to accomplish. In business school, I recall learning a slew of nifty strategic frameworks and the associating theories behind them, but not exactly sure how to apply them. I also have come up with strategic plans where it was so over-stuffed with wanting to do everything that there was no way to execute all of it well on the timeline associated.
However, in recent years, as I have had to teach my teams what strategy is, I have had to better learn it myself too. So, to become a better teacher, in a way I had to become a student first. This is where my relationship with strategy began to change. The common struggles that I have seen and experienced when it comes to strategy formation can be boiled down to either overcomplicating the process or being intimidated with the process. To change that affinity, it is important to level-set and peel back the layers behind words like strategic planning, strategic management, and other comparable terms. I truly believe that when strategy is utilized appropriately it can have a massive impact on your future as well as the future of your teams and organizations.
Defining What Is Strategy
Kenneth Andrews, one of the founding fathers of strategy, quoted that strategy “is the pattern of decisions that determine and reveal objectives, purposes, goals, produces the principal policies and plans to achieve these goals, and defines the range of businesses the company is to pursue, the kind of economic and human organization it is or intends to be, and the nature of the economic and non-economic contribution it intends to make to its shareholders, employees, customers, and communities.”
Now that is a very verbose articulation of strategy. However, distilling it down a bit more, I like what Henry Mintzberg communicated in his book Strategy Safari:
Strategy is a plan
Strategy is a pattern
Strategy is a position
Strategy is a perspective
Strategy is a ploy
The reason why I believe strategy is so difficult to fully understand is that there are multiple definitions of what it is and how it can be used. So as one of my colleagues would say, the definition is a bit “squishy.”
Different Schools of Strategy Formation
The common stereotypes around strategy are usually that it is a bunch of suits in a boardroom making decisions or it a super long document with intricate data tables and a mapped-out roadmap for the next 5-10 years. It may even feel like an afterthought because you simply don’t have time to think about it.
Based on what was communicated in Strategy Safari, there are 10 schools of strategy with 3 groupings (prescriptive, descriptive, and configuration):
The Design School: strategy formation as a process of conception.
The Planning School: strategy formation as a formal process
The Positioning School: strategy formation as an analytical process.
The Entrepreneurial School: strategy formation as a visionary process.
The Cognitive School: strategy formation as a mental process.
The Learning School: strategy formation as an emergent process.
The Power School: strategy formation as a process of negotiation.
The Cultural School: strategy formation as a collective process.
The Environment School: strategy formation as a reactive process.
The Configuration School: strategy formation as a process of transformation.
Now I won’t dive into each respective school of strategy, but from what you can guess in the name, each has a specific approach.
This is why when you look at different frameworks out there like SWOT, Porter’s Five Forces, BCG Growth Share Matrix, Organization Health, Three Horizons Model, 7S Framework, and more, each of them identify with one of these respective schools of strategy.
The Purpose Behind Strategy
Now that we understand that strategy exists in multiple flavors, then the other major component to improve your understanding is the purpose of strategy:
Strategy sets direction: It charts the course forward.
Strategy focuses effort: It promotes coordination of activity.
Strategy defines the organization: It provides people with a simple way to understand the organization.
Strategy provides consistency: It reduces ambiguity and provides order.
In clarifying the definition of strategy and the purpose it espouses, I would like to simplify all of that and state that strategy is simply creating a future that does not exist yet. It is just getting from Point A to Point B.
Four Core Principles of Strategy Formation
Now, I would like to transition to what I call my four core principles of strategy formation. These principles candidly describe on a more human level the personal connection between the strategist who forms the strategy, which is us, and the concept of strategy.
Creative Endeavor: First off, strategy formation is a creative endeavor. If strategy is about creating a future that does not quite exist yet, then strategy formation is about how you, as the leader, paint on the blank canvas. For me, this took years to figure out. To achieve that flow state where I could come up with ideas that I can then nurture further and hone to become great strategies, I needed to find my creative outlet; to find what allows me access to the right side of my brain. This could be my environment, the activity I am engaged in, the music I am listening to, and more.
Unique to the Person: Secondly, strategy formation is unique to the person. You will need to find the right combination of what works for you. This is like algebra class where you need to find the X and Y variables. The key is experimentation. You can use various strategic frameworks to help provide a shortcut. Also, you may find that certain hours in a day allow you to think better or that you need to listen to podcasts for inspiration. For me, the latter has worked extremely well, and usually, after listening to a podcast during a run, I will come back home and start jotting down ideas through a slew of sticky notes.
Uncomfortable: Thirdly, strategy formation is uncomfortable. It will take work to get better at it. Just think of the first time you learned something new like riding a bike. It feels awkward and unfamiliar at first, but it becomes easier as you engage in it more. Strategy formation is the same thing. It may take years to hone that, and you will need to continue to leverage it, or it can atrophy. In addition, because strategy is helping to solve problems or overcome obstacles and barriers, it is not easy. It is difficult to think through what can solve something because it requires the ability to step back and think. And that “pause” between thought and action is difficult because there is tension there.
Choice: Lastly, strategy formation is about a choice. It is about saying this path is going to yield the best result of my time, talent, and dollars. To do that requires a choice each day to focus on the right priorities; to focus your resources; to focus your time; to focus your people, and to focus your dollars in one coordinated direction. Also, if circumstances and priorities change or even obstacles present themselves, it is a choice to continue down the determined path or to choose to pivot. As my old boss said, there are multiple ways to get to where you want to go.
Lastly, when I think of strategy, especially in the context of a business, this is where I feel strong leadership and healthy organizational culture are major components to ensure success. Strong leadership, healthy organizational culture, and effective strategy formation are like legs on a stool. They differentiate organizations and I believe having all three truly separates a good organization from a great organization.
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William Liu, Executive Contributor Brainz Magazine
William Liu is currently a higher education marketing executive at the American College of Education. He enjoys the challenge of identifying and solving mission-critical problems for organizations and has a wealth of experience tackling challenges around the world from his time in the Army as a psychological operations specialist to now. In his 20 years working in marketing, he has a strong history of transforming teams through his emphasis on organizational health and culture. His mission in life is to leverage his leadership to help solve problems in his community, at work, and in the world at large. He believes that every life he can impact professionally or personally can lead to a better world.
