In this section we’ll explore essential insights into the nature of strategy and strategic planning. Richard P. Rumelt, a respected expert in this field, provides a candid perspective on the art of strategy. As you read through this thought-provoking content, consider how these insights may challenge or reshape your understanding of strategy.
A strategy is a way to overcome selected difficulties. It is not a wish list of wonderful possible outcomes. The art of strategy is not the art of decision making—that discipline assumes that you have been handed a list of possible actions to choose among. The art of strategy is also not the process of finding your one true goal and passionately pursuing it with all your heart and soul in everything you do—that is what some call monomania. Nor is the art of strategy the act of setting higher and higher performance goals for people and using charisma, carrots, and sticks to push them to attain those goals—that presumes that someone somewhere knows how to find a way through the thicket of problems the organisation actually faces.
- To create a strategy, one needs to embrace the full complex and confusing force of the challenges and opportunities being faced.
- To create a strategy, one has to develop a sense for the crux of the problem—the place where a commitment to action will have the best chance of surmounting the most critical obstacles.
- To create a strategy, one needs to be persistent and avoid the temptation to grab the first glimmer of a pathway through the thicket of issues.
- To create a strategy, one must balance a host of issues with its bundle of accompanying ambitions—the purposes, values, and beliefs that stakeholders wish to support.
- To create a strategy, one must keep actions and policies coherent and aligned, instead of nullifying efforts by pursuing too many different initiatives or conflicting purposes.
These facts are rarely written or spoken about with honesty. We are told that strategy is about having an advantage (obviously!)—that it is about having a long-term vision of where you want to be. We are told that by adopting method X or mindset Y the average business can become as successful as the very best. However, the honest fact is that we do not live in a fictional world, and the majority of organisations cannot be above average. The honest fact is that some situations are irretrievable and offer no clever way out. The honest fact is that organisations cannot change direction on a dime. The honest fact is that some situations are so locked up with competing political interests that there is not enough executive power anywhere to break the logjam. Strategy is not magic.
What is true is that to meet a challenge, one should first work to comprehend its nature. You cannot improve a failing school system unless you have a clear idea about why it is failing. To supply shoppers with a better shopping experience, you need to know about their wants, habits, and needs, as well as the technologies that can help you sell once you’ve learned their preferences. Don’t start with goals—start by understanding the challenge and finding its crux.
Richard P. Rumelt, an excerpt from “Getting Strategy Wrong, and How to Do It Right Instead”, McKinsey Quarterly, April 2022
https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/getting-strategy-wrong-and-how-to-do-it-right-instead