Strategy Development Beyond Traditional Boundaries

The Ghosts of Strategies Past: Are We Still Haunted?

Boardrooms today are haunted by the ghosts of strategies past. With its rigid 2x2 frameworks and dusty SWOT analyses, the spectre of old-school planning still lingers in the air. Due to the complex reality organisations face today, these antiquated strategies often fail. Why?

Because the deliberate strategies that have become?institutionalised?in organisations are outdated, they require the world to be stable, and they are wildly disconnected from the emergent and complex terrain we face. Alfred Korzybski correctly stated, 'The map is not the territory.' Yet, we are attempting to navigate the strategic world with maps created in the early 20th century.

A challenge that executives often face is becoming disconnected from the reality of their internal and external environment, working with outdated assumptions. The models we use to navigate complexity are vital inputs into strategic decisions.

Consider the Conant-Ashby theorem, a cornerstone in cybernetics, which asserts that a good regulator of a system must contain a model of that system. It's a compelling argument for constructing accurate models of our internal organisation and the turbulent external environment we are coupled with. Leaders must maintain these models with real-time feedback because a congruent model is a lens that brings the future into focus, enabling us to anticipate, adapt, and align actions with the strategic intent.

Suffering arises from trying to control what is uncontrollable, or from neglecting what is within our power - Epictetus

Another persistent myth is that we can exert control over every variable. This myth is perilous; it encourages complacency and rigid thinking. When leaders clutch outdated maps, mistaking them for the terrain, they navigate their organisations into treacherous situations, blissfully unaware of the risks ahead.

Volatility and uncertainty in complex systems, such as those we are increasingly seeing in recent years, cannot be underestimated. Volatility represents the speed and turbulence of change. Uncertainty, closely related, is about the lack of predictability and the prospect of surprise.

In this context, emergence is the spontaneous creation of order. It becomes a vital concept where new structures and patterns evolve from the interactions within complex systems. These systems, which cannot be controlled and predicted, are open systems with high variety.

The System Survival Theorem suggests that an organisation's survival depends on its capacity to adapt to the rate and complexity of environmental changes. This necessitates shifting from a control paradigm and traditional strategies that require stability to adaptability and responsiveness that acknowledges the complex interplay between our organisations and the environment. We need to develop real-time feedback, continuous adaptation, and an unwavering focus on the emergent nature of complex systems.

When the world is predictable you need smart people. When the world is unpredictable you need adaptable people. - Henry Mintzberg

With increased complexity, Henry Mintzberg's concept of emergent strategy beckons us to abandon the mirage of control. Much like Sun Tzu's ancient wisdom, which teaches us to emulate the fluidity of water, Mintzberg insists that strategy unfolds in the doing, a live process shaped by learning and adapting to the realities encountered.

To embrace the unpredictable is to accept that strategies are hypotheses tested against the hard surface of experience, and often, the lessons learned require us to redraw our plans. The deliberate strategy — the plan envisaged in the serenity of the boardroom — rarely survives the battlefield unscathed. The emergent strategy is the plan as it takes shape, informed by emergence and internal challenges.

Sun Tzu's teachings on adaptability remind us that our strategic thinking must be as malleable as water — taking the shape of whatever container it finds itself in, yet forceful enough to carve canyons over time. In practice, this means our organisations should be capable of rapid pivoting, not just in their tactics but also in their strategic outlook.

This agility is not just about speed or reflexes; it's a fundamental property of an organisation's culture and structure. A genuinely agile strategy permeates every aspect of the organisation, from its decision-making processes and information flows to empowering teams and allocating resources.

This fluid approach doesn't imply a lack of structure or purpose; instead, it demands a higher level of strategic discipline. It requires a keen sensitivity to the tremors of change, a deep understanding of the organisation's capabilities and culture, and an unwavering commitment to the strategic intent.

Leaders must embody the paradox of strategic planning: be firm in direction yet flexible in execution.

As we have highlighted, your external and internal environment are critical inputs for your strategic decision-making, but leaders often ignore them to their risk.

Maturana and Varela's theory of autopoiesis and structural coupling further illuminate the critical need for leaders to stay attuned to both their internal organisation and the external environment. Autopoiesis emphasises the organisation's inherent capacity for self-renewal and adaptation, underscoring the importance of internal resilience and innovation.

Structural coupling, meanwhile, highlights the necessity of being responsive and adaptable to the external environment, ensuring that an organisation's evolution is in harmony with the dynamic marketplace.

Together, these concepts advocate for strategic agility informed by the realities of the organisation and its broader ecosystem. This dual focus enables leaders to steer their organisations with a strategy that is not only emergent and adaptable but also attuned to the complex interplay of internal and external forces, thereby ensuring sustainable success in an unpredictable world.

Ignoring the integration of autopoiesis and structural coupling can lead organisations into strategic rigidity, making them vulnerable to rapid changes and unpredictability. Without recognising the importance of self-renewal and external adaptability, organisations risk becoming obsolete, unable to respond to emerging threats or capitalise on new opportunities. This oversight can result in a misalignment between the organisation's strategies and the dynamics of the external environment, ultimately compromising its long-term viability.

We define strategy as changing our fit with the environment to our advantage by differential use of power and time. - Patrick Hoverstadt and Lucy Loh

Given the challenges posed by structural coupling, is there an approach to strategy development that can deal with emergence and consider our relationship with the external environment?

Patterns of Strategy (PoS) by Patrick Hoverstadt and Lucy Loh is a profound response to the strategic conundrums outlined. It addresses the essence of strategy in a world where traditional frameworks fall short.

This innovative approach fundamentally shifts the strategic paradigm from a static, competitor-focused analysis to a dynamic interplay of relationships. PoS doesn't just account for the emergent nature of complex systems; it thrives on it, enabling organisations to navigate the unpredictable terrain of today's business environment effectively.

At its core, PoS reconceptualises strategy as the orchestration of relationships, focusing on the interactions and mutual influences among diverse actors within the strategic arena.

This perspective aligns seamlessly with the challenges of navigating volatility and uncertainty, as it acknowledges that strategies must be fluid and adapt to continuous environmental changes. By examining the interdependencies between an organisation and its stakeholders—customers, partners, competitors, and regulators—PoS allows for a more nuanced understanding of strategic positioning, enabling organisations to shift their relationships to their advantage.

The approach treats strategy not as a rigid plan but as a series of strategic manoeuvres—each designed to alter the state of play in favour of the organisation. This iterative process of action and reaction mirrors the emergent nature of strategy as advocated by Mintzberg and resonates with the adaptability preached by Sun Tzu.

By focusing on the dynamic interactions between actors, PoS embodies the principle that strategy unfolds in the doing, adapting in real time to the challenges and opportunities that arise.

PoS bridges the gap between strategic planning and execution. The precision in defining strategic manoeuvres translates into a clear implementation plan grounded in the realities of organisational capabilities and environmental dynamics. This alignment ensures that the strategic intent is preserved in translation but is effectively operationalised, with metrics to gauge performance and adapt as necessary.

In a world where the pace of change outstrips the speed at which traditional strategies can adapt, the PoS approach emerges as a beacon of adaptability and relevance.

What is the aim or purpose of strategy? To improve our ability to shape and adapt to unfolding circumstances, so that we ... can survive on our own terms. - Col John Boyd

This sentiment, echoed by Col John Boyd, underlines the essence of contemporary strategic thinking: the imperative to not just survive but to actively shape the environment to our advantage.

As we stand on the precipice of future challenges and opportunities, let us embrace the fluidity of our strategic endeavours. The ghosts of strategies past remind us of the peril of stagnation and the nonsense of clinging to outdated maps. However, the lessons learned from these spectral advisors illuminate a path forward that is adaptive, dynamic, and resilient.

Our continued journey through the strategic landscapes of tomorrow demands more than mere survival; it calls for a bold reimagining of what it means to lead and succeed.

By integrating the wisdom of the past with the innovative approaches of the present, we prepare not just to navigate but to transform the uncertainties of our era into our greatest strengths. The advantage belongs to those who can make sense of chaos and thrive.

How do you plan to adapt your strategies to survive and thrive in the midst of chaos?

Please feel free to share your insights and experiences in the comments below.

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