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This is the first of two articles exploring the connection (or rather, often the lack of it) between strategy and operations. The two things are separate but inseparable. Any organization needs them both to be working in harmony and feeding each other. We see many companies embarking on an exercise of strategic planning while simultaneously driving operations and operational efficiency, but the connection between their strategy and operations is somewhat tenuous - or even fine-thread-like.
Do you have a crystal ball that works?
Strategy itself is about achieving goals with the resources available to you while remaining within the inevitable constraints. Of course, your strategy can involve adjusting the resources and constraints to increase your chance of success. It also helps if you understand those resources and constraints and the real-world environment around you in which you are trying to make the best of those resources. Understand them so that you don’t have to be defined by them and understand them so that you can work with them to create the future you want.
Strategy is also about dealing with uncertainty - ie the future. We don’t have crystal balls, and so we must take best ‘guesses’ about the future while defining some sort of path for ourselves into that uncertain future. But we human beings don’t like uncertainty, so we either avoid it or try to do something about it ….
Don’t confuse strategy with planning
You can apply that definition of strategy to any level of the organization from the corporate ‘grand strategy’ to the goal of sorting out the stationary cupboard. There is a saying that “one person’s strategy is another person’s tactics”. But all too often, as soon as the word strategy is used, the P word (Planning) gets immediately fastened to it. It doesn’t have to be this way. Sure, many of the strategic planning tools are very useful, but they are not a means unto themselves and focusing on these can create a false sense of certainty about the future - and even act as a distraction from the real purpose of strategy.
But when it comes to ‘doing’ strategy, companies often seem to go in one of two ways: either ‘the head in the clouds’ version where a detailed, costed road-map to an uncertain and unpredictable future is crafted, or, the ‘head-down - feel your way’ approach where the company is constantly responding to whatever the real world throws at it while hoping one day to have the certainty to do ‘real’ planning. Both by themselves are very limiting.
Strategy is an Ongoing Process
I find it is best to consider strategy as a way of thinking and looking at the world with the aim of making headway towards somewhere you want to go. The “immutable plan for the future, head in the clouds” approach will never survive long-term contact with reality, and the “make it up as you go along” approach will mean you are blown with the wind as you constantly fight fires. In reality, strategy is an evergreen and ongoing process - and so a hybrid approach is needed. You definitely need some sort of roadmap that takes you towards your goals enabling you to remain oriented and heading in the right direction; you also need the ability to adapt and adjust based on current circumstances and the light of current knowledge.
Strategy without tactics is the slowest route to victory, Tactics without strategy is the noise before defeat. Sun Tsu – Art of War
Good business decisions are informed by good information - and that has to come from the real world: the customer (which drives revenue); or the process (which drives your bottom line); or the business (which defines your other opportunities and constraints). Rather than over-plan for a future over which you have relatively little control, it is far better to keep broadly well-connected with the real world in order to constantly validate your goals and make the best operational decisions when you have to make adjustments.
What about you?
Beware of Organizational Layers
Thinking strategically and thinking operationally use different parts of the brain or mind - as humans, we have evolved to do both – it’s how we get through our week. Strategy is a more creative process looking at possibilities and opportunities and seeing the interconnectedness of everything. Operations is about looking forward in time, planning and breaking a problem down into its component parts so that we can deliver on the vision. While they are different, there is no barrier between the two; and in the work-place, the operator needs to stick their heads into the strategic clouds on a regular basis to remain orientated, and the strategist needs to keep at least one foot on solid ground in the real operational world. Just as silos should not develop across a company, so non-porous organizational layers should not develop vertically in the organization. Everyone should think strategically while working operationally – and vice versa.
Things to think about in preparation for next week:
In the next blog …
We’ll look at how to operationalize your strategy - after all, that is why you go to the trouble of creating strategy - isn’t it?