When we think about the traditional conception of what business strategy is, we often think of it as a noun. It’s a plan that we create, that lives in some formal document, and is supposed to act as the codification of the direction in which the company is planning to go.
There’s this idea that the final deliverable is a PowerPoint presentation, a financial model, a report, a memo, or some combination of these. And once we arrive at that point, we have a ‘strategy’.
When we spoke with Carlos Trad at the 2021 Strategy Fest, we got a very different sense though as he introduced this idea of strategy being a verb. This simple analogy resonated strongly with the participants and so we thought we’d expand on the idea here because of how it can inform your own strategic thinking in your organization.
“So I’d like to think of strategy in a much more expansive way. I’d like to think of it as a verb. It’s something that you do at some point.”
Carlos Trad
Expanding the Conception of What Strategy is
Carlos was really eloquent in his desire to expand the conception of what strategy means in the modern context. Lots have been written about strategy, of course, and it forms a significant pillar in business literature- which means that there are plenty of resources from which you can learn. And while there is a multitude of different definitions as to what strategy is, a lot of them converge on similar points and so the field grew roots.
The downside of this proliferation of strategy content is that it can pigeonhole the idea into a purely theoretical one. The moment that you take a business concept and start to codify some of the best practices, you risk turning it into something that is static. If you’re not careful, strategy becomes an abstract concept that plays out on paper, in a somewhat academic way. And if this is your reality, then you’re missing the point.
Strategy should be alive and integrated fully into your organization. Carlos spoke about how strategy is more than just a plan. It’s actually the execution where things come to life. And if we aren’t thinking of strategy in that practical way, then we’re ignoring important implications that should be playing a role in our decision-making.
Carlos’ point about making strategy a verb is extremely astute because it encompasses many of the expansions he calls for. It’s worth looking at each of these expansions and seeing how it might affect the way we do things going forward.
Let’s look at each one on its own and then we’ll bring them all together again at the end.
Strategy is Ever-Evolving
The first expansion we want to make is to assert that strategy is not something that is static. It’s not a one-time task that is completed per se. Instead, it should be something that is continually moving and evolving with the times, as you learn more about the problem you’re trying to solve, and your competitors continue to maneuver against you.
The term that’s closest to this idea in modern business parlance is agility. A company’s agility is its ability to adapt to changing circumstances so that it can remain relevant. If you look at any of the high-profile business failures of the past few decades, most of them can be attributed to a lack of agility, where the world changed but the business stuck to an old strategy.
No matter what industry you’re in, or what type of business you run- there is never going to be a strategy that is future-proof. That’s just not how things work. Your strategy needs to be dynamic and open to feedback because that’s the only way that you’re going to adjust and adapt when needed. It’s this willingness to change things when you see the circumstances change, that is going to take your strategy from something laid out in a report and make it into something that lives and breathes on a day-to-day basis.
This is easier said than done though. We do tend to get quite attached to our plans and we’re often rationalizing things to ourselves to try and stay on the path that we had chosen. We’ll tell ourselves all sorts of things to avoid having to change because it’s painful and difficult. And it often means that we have to admit to ourselves that we actually didn’t know as much as we thought we did.
But if we can get over this ego and realize that the feedback we’re receiving is going to allow us to form a better strategy, then we can evolve. It can even be liberating because we can acknowledge that uncertainty is not something we’re ever going to get our heads around. Instead, let’s move forward, make decisions, and let our strategy evolve over time as it weaves through a shifting landscape.
When we allow for this flexibility, we can avoid the sunk cost fallacy and let the market drive the business to where it needs to be. Strategy should be dynamic and open to feedback, or else it risks being made irrelevant in no short order.
Strategy is Problem Solving
The next type of expansion relates to problem-solving for the customer. We should never get to the point where our strategic focus is only centered on how we can make our own business better. We need to be more holistic than that and realize that at the core of long-term business growth is an obsession with solving customer problems.
Strategy is about how we can create an organization that brings more value to customers. Then, in turn, we will be able to capture more value ourselves. If we de-prioritize solving real customer problems and instead focus all our energies on squeezing more out of what we already have, we miss out on opportunities to take our business to the next level.
It requires some out-of-the-box thinking and a keen understanding of our target audience to identify the key customer pain points we could be working to solve. A problem-solving mindset requires us to ignore the strategic decisions we’ve made in the past and look objectively at where we stand right now.
Is there a blind spot in our thinking?
Are we missing a key opportunity to help our customers?
What problem can we solve next?
This back-to-basics approach is crucial because it reminds us why we’re in this business in the first place. We’re here to solve problems for customers.
The moment we become too insular, and our strategy revolves only around improving our own internal metrics, for our own good- then we are in trouble. Topline growth is always something that we should be focusing on and so our strategy is not just how to build a better business. It’s also about how to be better stakeholders for our key customers.
Strategy is Collaboration
The next expansion that we need to make is to make the whole process much more inclusive. We want to co-create strategy and then let it flow into the rest of the organization because we are relying on our people to actually implement it.
Too often, strategists tend to hold on tightly to their work because they feel they have full ownership of it and it’s what justifies the high salaries that they are paid. However, this is short-sighted, because even with the most thoughtful strategy, someone has to actually execute on it. And it’s not going to be you.
You are completely reliant on your stakeholders doing the work that is required to bring a strategy to fruition. As such, you need their buy-in and you need to be connected with them so that you can build a strategy with execution in mind. It’s a verb, remember?
The best way to do this is to collaborate and ensure that they are a part of every step of the process. When you do this, you end up with a strategy that is robust, well-understood, and aligned with the reality of what’s happening on the ground. Strategy is not just for suited executives. It’s for the whole organization. And the sooner you realize that the sooner you can involve those people and leverage that all-important wisdom that lies untapped inside your business.
Strategy is Owned, Not Hired
A lot of businesses like to turn to external consultants when it comes to setting their strategy. These firms can bring a wealth of experience, knowledge, and disciplined thinking to the table and this can be extremely valuable for any organization. They also come with fresh eyes which can illuminate things that you hadn’t actually realized about your own business. We often develop blind spots because we’re just too close to our business and we’ve forgotten how to see it with fresh eyes. In these cases, consultants can be really valuable.
The risk though, is that we outsource the strategy entirely and we lose that personal attachment to the strategy. It can seem easier to just pay for someone to do the work and deliver to us a perfectly suited strategy because it saves us the headache. But at the end of the day, we are the ones who have to go out there and execute on it. The planning is actually the easy part. Strategy is a verb and it’s something that we must do.
So, we have to have some modicum of control and ownership over the strategy, even if we are using external help to come up with it. This is not something that can be completely handed away. It needs to be a collaborative effort where we understand how the consulting firm is going about their work, what data they are using to inform their recommendations, and how exactly they should be implemented over the long term.
Carlos did mention one example of when he worked with a consulting firm that actually did help with the execution of their strategy, but these stories are few and far between. And even if the firm is going to be working with you going forward, they don’t have the same attachment as you do. You are merely a client to them, whereas this business is yours. You should treat it accordingly.
You need to own the strategy and be in full control, regardless of who you hire to come up with the plans.
Strategy is Accountable
Another expansion that is important to understand is that strategy needs to be accountable. We need to be constantly measuring our progress and holding our feet to the fire so that we know that we’re on the right track. Instead of just setting our strategy and forgetting it, we need to be reviewing things on a regular basis so that we can be agile and adaptable when things aren’t going well.
The way you do this is by integrating your key strategic goals into the short and medium-term goal tracking throughout the organization. Whether it’s in your KPIs, OKRs, or whatever process you use to measure progress, you want your strategic vision to inform all of these objectives. Then, you can know that at any point in time, you have your strategic outcomes in mind. Every team can focus on playing their role, but the combination of all of these smaller steps is leading in the right direction.
Then, once you’ve got those building blocks in place, you can set up a regular strategic reflection that brings them all together and evaluates your progress against those key metrics. You have to be brutally honest with yourself here and let the data speak for itself so that you have a true reading of how the business is performing when compared to the strategic vision you set out for it.
This is an important step because strategists need to be held accountable for the decisions that they make. It’s only through learning from feedback, that we can improve our strategy and make the right decisions for the long-term success of the organization. That’s why we must think of strategy as a continuous process because it’s in the juxtaposition between reality and our expectations that we can begin to craft a strategy that is highly effective.
In the same way that we iterate towards product-market fit, our strategy should be iterating based on the feedback we’re getting and the metrics we are tracking. Without this accountability, we leave ourselves in a position where our business can drift, and we don’t know why.
Accountability and performance evaluation is crucial. You can’t get around it.
Strategy is Hard Fought
It’s safe to say that this stuff is not easy. Coming up with a viable business strategy that is going to guide a company through uncharted waters is a very challenging thing to do and we shouldn’t expect otherwise.
When you read a book about strategy, you might think that you can just follow the perfect 10-step plan and you’ll be off to the races, but it’s not as simple as that. Crafting a good strategy takes time and effort, and we need to acknowledge that in our internal processes.
By seeing strategy as a verb, we’re more likely to expand the concept beyond a perfectly finished product and realize that it’s actually an approach that we take over the long term. As we learn from time in the market, we implement the wisdom we uncover, and we slowly oscillate to a place that we want to be.
With every obstacle we overcome, we fine-tune our strategy a bit more. With every failure, we learn something and can avoid similar failures in the future. With every misstep, we can correct our path and head in a better direction. All of this talks to a willingness to fail and not let ourselves be dissuaded from the mission. Strategy is not something to get right or wrong, it’s a direction for us to trod. And it won’t be a straight line. There will be ups and downs and every piece of information that we gather helps us to improve our strategy a little bit more.
It’s through this incremental progress, that we arrive at strong strategic decision-making. It doesn’t happen overnight. So take the pressure off yourselves, and just focus on making the next right decision. If you do that time and time again, you’ll be where you want to be in no time.
Recap
We hope that Carlos’ expansion of what strategy means has given you some food for thought. It’s certainly changed the way we think about things here at Cascade, and we hope that we have illustrated that strategy is a verb, not just a noun.
When you take this idea seriously, it can completely disrupt the way you were thinking and open up a range of new opportunities for your organization. All it takes is a shift of mindset and your strategy can live and breathe once more.
