Recognizing a Bad Strategy: A Guide for Leaders Taking on a New Role

Stepping into a new leadership role brings a host of challenges and opportunities. Beyond meeting immediate targets, you’re tasked with charting the course for your team’s future success.

One of your first and most critical responsibilities is to ensure that the strategies guiding your team and organization are robust and effective. However, identifying and addressing flawed strategies is no easy feat.

In my opinion, one of the best books on strategy is Richard Rumelt's "Good Strategy/Bad Strategy". The book opened my eyes to the frequent pitfalls that managers encounter when formulating strategies.

For those short on time, I’ve distilled some of the key insights here. This article is the first in a two-part series aimed at equipping leaders with the tools to craft impactful, actionable strategies.

The Kernel of a Good Strategy

According to Rumelt, a solid strategy must consist of three foundational elements, collectively referred to as the kernel:

1. Diagnosis – Identifying and understanding the key challenges your organization faces.
2. Guiding Policy – Establishing principles that direct how you’ll address these challenges.
3. Coherent Actions – Developing specific actions and projects aligned with your guiding policy to overcome the challenges.

Without these elements, what you have is not a strategy—it’s merely a wish list. A weak or missing element undermines the foundation of any strategic plan, making it difficult to achieve meaningful progress.

What’s NOT a Strategy

Understanding what makes a strategy effective also helps you recognize what doesn’t qualify as one. Here are common missteps leaders should avoid:

• Objectives Without Action: Goals like “achieve 20% market share” may sound compelling, but without actionable steps, they’re just numbers on a page.
• High-Level Decisions Aren’t Automatically Strategic: Just because the C-suite decides something doesn’t make it strategic. Strategy involves clear, actionable plans to achieve objectives.
• Direction Without a Map: Setting a broad direction is not enough; you need detailed actions to turn that direction into reality.
• Opportunities Without Guidelines: A strategy that highlights strengths or opportunities but lacks a clear plan to leverage them is incomplete.

What Makes a Strategy “Bad”?

Rumelt emphasizes that bad strategy is not merely the absence of a good one—it’s often the product of flawed thinking. Here are some red flags:

• Fluff: Jargon-heavy language that sounds impressive but lacks substance. Statements like “Our strategy is to lead in innovation and customer focus” may appear meaningful but offer no clear direction.
• Lack of Focus on Challenges: A strategy must address specific challenges. If challenges aren’t clearly defined, the strategy lacks relevance.
• Confusing Goals with Strategy: Goals like “increase sales by 20%” aren’t strategies—they’re targets. A true strategy explains how those goals will be achieved.
• Unrealistic or Scattershot Goals: Rumelt calls this the “dog’s dinner” approach—a disorganized mix of objectives that lack coherence and focus.

Avoiding Bad Strategy

A bad strategy often stems from incomplete foundations, unrealistic goals, or vague language. While it may look polished on paper, it fails to provide the clarity and direction needed for execution.

As a leader, your role is to diagnose challenges, craft a guiding policy, and outline coherent actions that address the organization’s needs.

New leadership role: a good time to take a fresh look at strategy

The transition phase when taking on a new leadership role is crucial. Whether it's a new CEO position, or a promotion to lead a business unit or team. This moment offers you the opportunity to evaluate existing strategies, realign your team and set a clear path forward.

By recognizing and avoiding the hallmarks of poor strategy, you can position yourself as a leader who will drive meaningful change and long-term success.

Next Steps

In the second part of this series, we’ll explore the characteristics of good strategies in greater detail and discuss practical steps for building strong, actionable strategies tailored to your organization’s unique challenges.

Additionally, you can sign up for my mini-webinar on summarizing a strategy on a single page. In this session, I’ve integrated all the elements of a good strategy into a simple and practical format. You’ll learn how to turn complex ideas into clear, actionable steps that set you and your organization on the path to success.

Participants' feedback on the webinar has been phenomenal! Here is an example:

"I recently attended a “Stategy on a Page” webinar led by Andreas from Agility3, and it proved to be a game-changer for me. Taking on a new leadership role at a tech company undergoing significant restructuring required a level of strategic clarity that seemed daunting at first. Andreas provided precisely what was needed—an ability to distil complex challenges into clear, actionable ideas with a structured, no-nonsense approach. His framework allowed me to articulate our goals and strategies in a manner that was both insightful and easy for key stakeholders to grasp. Andreas’ expertise came at the right time and has greatly assisted me to lead with confidence, bridging complex industry concepts and strategic action seamlessly. I highly recommend this webinar for anyone seeking to navigate transformation with clarity and impact. "

Click here to sign up for the free webinar.