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15 Strategy Formulation
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THE TRUTH: Effective business strategies emerge from coordination, flexibility and responsiveness.
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When organizations work at developing a coordinated, flexible and responsive posture, effective business strategies simply emerge. Such companies can do much better than companies that work at developing detailed, long-term plans. Remember that the amount of detail with which we illustrate our plans has absolutely nothing to do with the quality or relevance of those plans (we’re talking long-range strategic planning here, not the more concrete and immediately relevant tactical action/project planning, which is indispensable). |
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The capability of all people in an organization to work in a coordinated, flexible and responsive fashion — that is the seed of effective business strategy. For even the most highly-refined and developed organizations, this will always be a matter of ongoing change and adaptation. (Organizational Restructuring) Let us examine each of these three key organizational ingredients separately; coordination, flexibility and responsiveness. |
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The first ingredient of effective business strategy is coordination. This is perhaps the single most important ingredient and also the single greatest failing point of the old-style planning process. The coordination needed here is a deep, ongoing, reciprocal kind of coordination. It is not simply a matter of checking with others before proceeding as you intended. It is about involving others right from the start, and at every step along the way. It is the kind of coordination that happens when all involved parties accommodate each other, so that the entire enterprise can move forward together, in unison. |
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Which brings us to the second ingredient — flexibility. This is another major failing point of old-style planning. When companies illustrate their plans with minute detail, and then commit them to paper, plans take on a "written in stone" quality. People see this, and correctly determine that matters are beyond their control. Different people and different groups in these organizations become politicized. Some are pro-plan. Some are contra-plan. Most are indifferent and go along because it is expected of them, without any real commitment or enthusiasm. |
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Alternatively, when companies have a culture of genuine flexibility, people become involved because they do have influence. And when people experience having influence, they become enthusiastic about their work, and committed to the success of the enterprise. The political factions no longer have to sign people up with motivational talks or water-cooler gossip. Instead, people enroll themselves as committed members of the organization because they have their own expectations, and they want to see them fulfilled. |
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Responsiveness is the third ingredient of real strategic power. Inherently, this means responsiveness to opportunities and threats arising beyond one's own organizational boundaries. (A Network Approach toward Innovation) This kind of responsiveness is an integral directive for organizations that effectively execute winning strategies. (Responsive Operations Strategy) To succeed over the long-term in the new millennium, organizations must rapidly respond to the needs of their customers, the concerns of environmentalists, community members and government regulators, emerging technologies and the desires and aspirations of their employees, to name just a few. Without this responsive posture, an organization will certainly fail to seize every opportunity – which is a failure it cannot afford. |
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Responsiveness is a dimension of both coordination and flexibility. Its meaning fuels our imagination and guides our action. When companies can build a shared understanding of how to embody coordination, flexibility and responsiveness in everything they do, their effectiveness can improve by an order of magnitude, without even the most elementary of plans. Effectiveness is a matter of harmony, not planning.
In order to effectively implement winning strategies, people in companies must:
- be flexible by taking the needs and concerns of others as their own
- coordinate their activities by coming to a genuine understanding of each other’s thinking, and
- act with a genuine spirit of responsiveness to the needs and concerns of associates inside the company, as well as stakeholders and strategic partners outside of the company.
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Effectiveness is a matter of harmony,
not of planning.
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