What is & Who does Strategy ?

Artikel ini suntingan dari debat di situs Europe Business Forum yang ditulis oleh Alistair Fulton Head of Strategy dari BT Cellnet.

Define what it is and who does it
by Alistair Fulton

The word ‘strategy’ is probably one of the most misused and abused words in modern
business parlance. Strategy is a word whose meaning varies according to the context in
which it is used and who the speaker is.

It has been employed to describe truly visionary ideas and to provide the kind of window dressing to appease worried investors that was all too common in the dot-com boom. It’s a word that’s very much in vogue in these uncertain economic times, and one which is in common use by decision makers at all levels within organisations.

I’ve heard speakers use the word to justify decisions, to reassure audiences that the vision pursued is clear, to blind analysis, to describe ideas, actions and even objects (I’ve yet to meet a strategic vending machine but I’m sure it won’t be long).

Whether or not strategy matters depends upon what it is, and more importantly who does it.

What is strategy?
Strategy is defined in the Chambers dictionary as “the art of guiding, forming or carrying out a plan.” Traditionally it was all about building forecasts of future market environments and using these to evaluate alternative courses of action. Usually with a comforting spreadsheet somewhere in the background, the answer came supported by a range of graphs which
gave the reviewer the reassurance that the forecast future was a near certainty.

In markets which are, or at least were, relatively predictable these techniques are an effective way of forecasting market drivers and reducing the risk inherent in business choices. However in recent years and in newer markets, particularly those where technology plays a key role, these techniques are less useful. A lower level of certainty about what’s going to happen – what technology will bring, what customers will want and what competitors will offer, mean that
the only guaranteed outcome is that you will get the answer wrong, just how wrong is the question.

More flexible methods like scenario planning have been developed in response to some of these problems and have been used to good effect. By giving companies the opportunity to build and test alternative approaches it’s possible to factor in some of the uncertainty inherent in more fluid markets. By accepting this uncertainty, decision makers have been given the chance to explore a fuller range of outcomes, and to build a more comprehensive knowledge of their current environment.

Flexibility, learned and built into business plans, has helped companies to recognise, and respond to, changes in their environments and to react more quickly and more efficiently to the
needs of customers. The effectiveness (and importance) of strategy doesn’t really depend upon how good individual answers or strategies actually are, it depends on how good the process of
adapting is. A strategic choice may serve to generate advantage at a particular point in time, but the benefit is likely to be temporary unless you build a process to repeatedly refresh it.
There’s a difference between strategy and shared vision or direction, though the two are often confused. A shared vision is as central to the success of an organisation as the ability to make
strategic choices, acting as the collective corporate consciousness which informs each choice that is made. Companies have been successful in part because they have a process by which they develop and continuously review the choices they make, and in part because they have a shared vision of where they are going. This does not mean they always get it right, but it does mean that they have a process of coping when they get it wrong.

Who does strategy?
If you take the above definition of strategy literally everyone in your organisation does it, from purchasing manager to managing director, even if the choice they are making is not to plan for the future.

Many companies choose to ignore this fact, and ‘outsource’ the development of strategy to the ‘strategy department’, at least one of which you can find in most larger companies. Sometimes termed ‘strategy’, or ‘planning’ or even something more exotic like ‘futurology’, the traditional role for these units is to ‘develop the strategy’, usually in close conjunction with the board or
CEO, helping the organisation both make choices but also to create the all important shared vision. Once agreed by the senior management team, these high level decisions and a description of the vision and goals of the company are cascaded down through the business to ensure that decisions are made on a consistent basis.

This approach has been and continues to be very effective for many companies, allowing as it does a high level of focus on the definition of mid to long range planning, relying on the types of
forecasting techniques discussed above. In faster moving and less predictable environments this approach can slow an organisation’s speed of response and limit flexibility, denying as it does the need for often quite junior decision makers to make big choices about the future.

This doesn’t mean that corporate strategists are out of a job (or that strategy doesn’t matter), it just means that the approach needs to change. Strategists need to focus on the process of developing strategy rather being the owner of the ‘answer’, working within organisations to develop better decision making capabilities with which to tackle the future.

Does strategy matter? Yes, getting your strategy right matters, but you’ll only repeat the trick by building the right processes and developing a shared vision of the future.