I recently posted that the creation of strategy was better served by being flexible and agile than creating concrete plans. Here’s part 4:
9. Think Scenarios, not Predictions 1
The future is too complex to accurately predict. It is pointless trying. What can (and should) be done is for firms to consider a range of possible eventualities and how well (or not) their strategy would measure up were these to occur. This leads to a far more flexible approach to strategy which, in turn, increases execution clock speed.
We go back to my and Rob’s assertion that the creation of strategy was better served by being flexible and agile than creating concrete plans. 2 (Points originally derived from Beinhocker, Eric) 3 Basic MBA stuff here, but I hate probabilities.
#9 on Rob’s list possibly should have been #1 because it’s really the first thing you do. The definition of your strategy is not about situating your organization in today’s marketplace, but in all possible eventualities. Rather than trying to achieve a state of perfection today, create an environment that positions the organization advantageously in probable future scenarios.
OK, I can’t really help you out if a scud missile hits corporate headquarters, but let’s face it: we don’t know what’s going to happen in China and India 5-10 years out, predicting the true impact of the supposed “talent drain” is difficult to impossible, and technological innovations to aid our work is ever expanding. It doesn’t matter that you chose the best strategy for what you think might happen, but that you chose a strategy that addresses multiple possible outcomes and your organization is agile enough to change tactics as needed.
Thanks again to Rob for the source article.
- Millard, Rob, June 5, 2006. “Increasing Your Strategic Clock Speed.” Retrieved from http://www.robmillard.com on August 6, 2006. [back]
- Millard, Rob, August 5, 2006. “Creating Prepared Minds.” Retrieved from http://www.robmillard.com on August 6, 2006. [back]
- Beinhocker, Eric, June 19, 2006. “Creating Strategy in an Unknowable Universe,” HBS Working Knowledge. Harvard Business School. Retrieved from http://hbswk.hbs.edu on July 3, 2006. [back]