What is strategy?
Nov|16|2009 Mark Gallagher and Laura Savard
Most people have a vague, if not incorrect, definition of strategy, often confusing it with tactics. This shouldn’t come as a big surprise. Many people derive definition through association. Over time, misuse of the words Strategy, Strategic, Tactics and Tactical have obscured their meaning, so much so that for many organizations “strategy” has become a barrier to success.
Before you can formulate a strategy, your team must share a common and accurate definition. Ensuring that your definition is clear and simple makes for better communication.
What is strategy?
The word strategy is rooted in the military and is derived from the Greek word for general (Origin: Stratēgía Generalship). Strategy can be defined as a plan of action designed to influence and control events to achieve a particular goal.
To define strategy we must also define tactics. The term tactics, also of Greek Origin (taktikós), refers to moving, arranging or ordering. Tactics are actions for executing strategy. So, while strategy is a big picture plan, tactics are the actions for executing the plan. Yet, illustrating that tactics are how strategy is executed, still does not fully explain strategy.
Strategy: A Mathematic Definition
Colonel (Ret) Arthur F. Lykke Jr. of the U.S. Army War College developed a “strategic framework”. Defining strategy as a mathematic equation, Colonel Lykke outlines the whole, its parts and the relationship between them. He provides a framework that is clear, simple and elegant.
Strategy = ƒ(ways + means + ends)
Ways: Actions taken to achieve goal (Tactics)
Means: Resources available to the organization
Ends: Desired goal state and assumed risks
Note that ends (the desired goal state) is based on predefined view of success. This can take many forms and it is unlikely that every organization will define it the same way. However, this also begins to explain why so many confuse strategy and tactics. When one misunderstands their own role relative to the big picture, they begin to misunderstand the goal. Of course this also occurs as people attempt to position a small idea as being larger than it actually is.
A team that understands strategy, understands how and where they fit in. Without an accurate definition of strategy it’s unlikely that your organization’s actions will support its definition of success.
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good stuff, mark and laura — especially the point "ends (the desired goal state) is based on predefined view of success" — makes a lot of sense, particularly in terms of "brand strategy"
"Stractical" the unfortunate confusion of strategy and tactics.
I think the blurring often comes from the fact that both strategy and tactics stem from answering the same question: How are we going to achieve an objective? Continuing the military analogy – the objective of the first Gulf War was simple: Liberate Kuwait. When asked what the strategy would be, Gen. Powell is reported to have said – "Cut off the army's head." And when asked how THAT would happen, the response was "Those are tactics, ask Gen. Schwarzkopf."
When asked 'how are we going to achieve 10% customer growth?" it is far easier to answer in tactics rather than strategy; the former are concrete actions that we know how to implement. Strategies are a bit more ambiguous – one can't simply implement a 'strategy'. Strategy is about alignment, filtering and focus; its purpose is to eliminate ideas, products and tactics that aren't related to the way in which an objective is to be achieved.
Maybe strategies are best thought of in terms of 'why' an objective was met or not; rather than 'how.'
Hi Mark,
I like to define "strategy" as "a series of predefined steps strung together to achieve a required/desired outcome".
Looking forward to reading more considerations,
JC
I like Porter's definition a lot. In short, he says that strategy is being deliberately different than your competition in order to gain advantage. At least that's how i understand it. So strategy and differentiation are closely linked.
http://www.quickmba.com/strategy/generic.shtml
http://www.quickmba.com/strategy/porter.shtml
Agree, Porter's definition is the gold standard. Strategy is nothing more or less than making different choices than your competition. Everything else is execution.
He always added that a company's real strategy is revealed in it's actions and priorities, not in it's "Strategy Statement."
Mike and Michael,
You are both right. A definition of strategy without mentioning Porter is incomplete.
I agree with Porter's argument that a competitive strategy is both a plan and position. However, in addition to saying that strategy is "about being different" and "deliberately choosing a different set of activities to deliver a unique mix of value" Porter goes on to define competitive strategy as:
"a combination of the ends (goals) for which the firm is striving and the means (policies) by which it is seeking to get there."
Given that Porter refers to ends and means, I would argue that his definition is not in conflict with Colonel Lykke's “strategic framework”, but rather they support one another.
Mark Gallagher
Brand Expressionist®
I reckon strategy is a process for an enterprise, corporation or network to embed itself within a defined environment, to identify it's values, strengths and weaknesses, and consequently infer and communicate future direction and focus to itself and it's stakeholders. It is an organisational paradigm from within which a company, corporation or network can view itself in the present context and develop an approach for the future. What differentiates it from the tactical is the holistic overall vision and understanding within the present and future context rather than just the operational side of things.
Heather
"Strategy" has definitely become a bad word, right up there with "creativity" and "innovation." They all can be conveniently seen as mucking up business by adding time, cost, and complexity.
To more successfully drive a strategic perspective, I've used "addressing what matters with insight and innovation" as a definition for "strategic thinking."
It's tough for people to argue with "what matters," esp. when making a case for something tactical as REALLY important. It forces them to put up or shut up if something is more a pet peeve than a big business issue. "Insight" is easier to make stick than innovation; people don't want to be "dumb" about what they're doing but are often more willing to approach it with a "status quo" mindset.
The clear implication the past few years (http://bit.ly/17uTQO): the simpler and more straightforward the definitions, process, and deliverables of strategy work are, the more likely something successful will happen.
@Brainzooming
To me strategy is not pursuing a detailed plan step by step, it is finding or creating options that give me an advantage at any moment.
If we take the military analogy, there's a saying that: No plans ever survives contact with the enemy.
Then:
The essence of strategy is not to carry out a brilliant plan that proceeds in steps; it is to put yourself in situations where you have more options than everyone else. Instead of going for A as the single right answer, true strategy is positioning yourself to be able to do A, B or C depending on the situation.
It's important to have context and be able to adapt to changing conditions and that ability is what separates the strategists from the tacticians.
Field Marshall Helmuth Carl Bernard von Moltke said: "No battle plan ever survives contact with the enemy."
However, Dwight D. Eisenhower said: "In preparing for battle I have always found that plans are useless, but planning is indispensable."
Laura Savard
Brand Expressionist®
I agree with the latter, but it also implies to create a plan with branches. Planning gives you the initial context and shows you a picture of what you might see.
Some athletes do this by visualizing the different scenarios they may encounter before a competition, this 'planning' beforehand enables them to react as if they're already seen it before. They're prepared.
So in a sense you have various strategies and not just one.
I think the whole key can be summed up with:
Fortune favors the prepared mind. – Louis Pasteur
In your athletic example, Jorge, you're actually describing a strategy with various tactical options. The strategic part of it is the overall plan designed to achieve the objective; the tactical planning part of it is the options that one sees to initiate or to react to circumstances that are necessary to implement the strategy.
On a separate note: Eisenhower also said, ""History has proven that nothing is more difficult in war than to adhere to a single strategic plan. Unforeseen and glittering promise on the one hand, and unexpected difficulty or risk on the other, present constant temptation to divert the chosen line of action in favor of another.
"But the war in Europe was finally won because … the President, General Marshall and many others never wavered from their purpose of launching a full-out invasion of Europe across the English Channel at the earliest practicable moment."
The tactics changed; the strategy didn't.
James,
Thanks for pointing that out and I agree with you. A good business example of what I meant of having multiple strategies at once is Microsoft.
It's well known that they pursue different strategies or initiatives in parallel and back when they started they we're doing not only DOS, windows 1.0, OS/2, word and excel for Apple (then Macintosh) and even UNIX.
What they were playing for was to make MS products the platform for personal and corporate computing and as we know Windows was the winning bet.
So instead of committing to one option they played several hands each designed to deal with the different possible outcomes all towards that single strategy.
And I do agree with you, tactics are the ingredients. It really is all about finding that perfect mix of tactics to fit a strategy.
Strategy? The happiest customers and coworkers. Everything else is creativity and execution.
"Tactics is knowing what to do when there is something to do. Strategy is knowing what to do when there is nothing to do." Savielly Tartakover, Polish Chess Grandmaster.
The use of the "Ends" implies metrics. Those metrics are the end result of a decision support system. When you design your "Ends," you design your metrics and its decision support system. The exploration of your choice set demands some means of converting the data about drivers into outcomes, so you end up designing your metrics and decision support system as you do your exploration.
You are not just making a decision. You are also creating an information environment.
I LOVE the definition. Sheds light where previously there was darkness which is a great method to grow a mushroom but not such a proven way to infuse a brand with life. In my experience, I would say many clients do not understand the differences between the two. Heck, I would say few designers know the difference, which explains why so many clients are satisfied with me-too, same-as-everyone-else clichés. As I've said before, clichés can kill a brand faster than a room full of politicians (which is a key foundation I stress on all of our clients' strategies): Lead with innovation and distinction, and don't mimic with tired and vanilla clichés.
As Jack Welch would say :
“Strategy is actually very straightforward. You pick a general direction and implement like hell”
Hi, invited by Mark Gallagher, I'd like to to contribute to this really good discussion. I am often involved in unpicking the difference between strategy and planning/tactics with clients. My very simple take is that strategy is about where you want to go. Whilst planning is about how you're going to get there. The difference is critical: when surprises (good or bad) come over the hill, you may need to change plans but that shouldn't mean letting go of the strategy. Take a look at a this little movie in which I try to articulate the idea… http://bit.ly/strategyandplanning
For balance, it should be noted that this is "your" definition of strategy.
In our book, Managing Value-Based Organizations: It's Not What You Think, I wrote at length about the myriad definitions of strategy and the inability of most organizations to implement it. I concluded that despite the confusion, it probably didn't make any difference because even opposing strategies delivered the same results – some good; some bad.
For example, US companies have historically adopted strategies that are the opposite of those pursued in Japan; but the outcomes have been the same.
All of us can benefit from focusing more on the outcome than on the process.
Cheers,
Dr Bruce Hoag, CPsychol
Organizational Psychologist
Bruce,
Your post implies that you disagree with Colonel Lykke's strategic framework. However, you haven't stated what you disagree with, nor have you provided an alternative definition. I believe that providing your own definition of strategy would help everyone to better understand your point of view.
I do have one question. You state that "despite the confusion, it probably didn't make any difference because even opposing strategies delivered the same results – some good; some bad." I'm not sure what you're trying to say here. If opposing strategies deliver the same results, how could those results be at opposite ends of the spectrum?
Mark Gallagher
Brand Expressionist®
I've researched this topic exhaustively have found that there's no consensus on what strategy is. To quote from our book, "Strategy can be a policy, plan, process or outcome. It can be created intentionally by senior managers, accidentally through market forces or societal behavior, or can simply become apparent as a result of day-to-day manipulaton of organizational resources in the completion of tasks" (Managing Value-Based Organizations: It's Not What You Think, p. 130). This means that the word "strategy" has so many possible meanings that it has ceased to be an effective term.
Lykke's definition distinguishes between ways and means, but these words are practically synonymous. "Ways" could be construed as "paths;" "means" could be understood as techniques or methods. Taken together, they amount to how we get from here to there.
Although it's critical to the process to ask, "did we get where we wanted to go?," it seems to me that the evaluation of "ends" needs to be separated from "how we attempted to get there." Perhaps Lykke is simply saying in a more complicated manner that it doesn't matter how you got there; only that you did. If that's the case then the equation should be simplified to f(ends). Of course, this suggests that the ends justify the means.
Let's plug some numbers in so that we can understand Lykke's equation better. If "ways" and "means" were zero, and "end" was one, then the sum would be one. In other words, ends could be achieved without ways or means, and therefore the function of either one of them would be irrelevant. If "ways" and "means" were each one, and "ends" was zero, then the sum would be two, but the ends still would not have been achieved. This is the bane of many organizations. Great plans, but poor results. So while it may look elegant on paper, I don't think Lykke's equation helps us understand the concept of strategy.
It's also worth noting that strategy is formulated for different motives. This amounts to creating different, even opposing strategies. For example, US companies are known to make strategy to increase profits. Their plans are likely to differ from those who develop strategies out of national pride, as do many Japanese companies.
One of the most famous examples of this occurred when Japan decided to attack Midway Island during WWII. Had they assaulted the island all at once, they could have simply overwhelmed it with superior force as the Americans would have done in similar circumstances. But such was their pride, that they had battle groups scattered all over the Pacific. The Americans foiled their plans by sinking or disabling their aircraft carriers. Even without them, the Japenese probably could have taken Midway; but instead they retreated because their strategy had been thwarted.
Despite the fact that word "strategy" has been inflated to legendary proportions, we still don't seem to be any further along in our understanding than we were before we developed our flowery descriptions. It seems to me that we need to stop worrying about how to define it or how to diagram it, and just do it. We'll probably get better results and save ourselves a lot of time in the long run.
Bruce,
In our experience, the biggest obstacle regarding strategy is a lack of definition. If no one knows what they are supposed to be aiming at then the likelihood of hitting the target is slim. I agree that strategy has become a buzz word. Almost everyone juxtaposes the term with tactics. This has led to the point where, for most, the word “strategy” has become more of an adjective than a noun.
However, you stated, “Lykke’s definition distinguishes between ways and means, but these words are practically synonymous.” They are not. This is like saying that a fist and a punch are one in the same. Additionally, you stated, “Let’s plug some numbers in so that we can understand Lykke’s equation better. If ‘ways’ and ‘means’ were zero, and ‘end’ was one, then the sum would be one. In other words, ends could be achieved without ways or means, and therefore the function of either one of them would be irrelevant.” This only proves that a lack of action (ways) and resources (means) still result in an outcome (ends).
You obviously disagree with Lykke’s definition. You appear to be arguing that because there is no consensus on what strategy is, then strategy has no definition. Strategy is not as an elusive a concept as love, and yet many have done a reasonable job of defining love. My favorite definition may very well be Jerry Maguire’s (1996) “You complete me.” Maguire’s interpretation (or rather writer/director Cameron Crowe’s version) provides a clear, simple definition that amplifies exactly what love is.
Until you provide an alternative definition, it is difficult for any of us to understand your point of view.
“If you can’t explain it simply, you don’t understand it well enough.”—Albert Einstein
Mark Gallagher
Brand Expressionist®
According to Dictionary.com, "ways" and "means" are synonymous (http://thesaurus.reference.com/browse/ways). You may disagree, but there are others who hold the same opinion as I do.
The "fist" and "punch" example you give doesn't really work very well. In this context, the former is obviously a thing, and the latter an action.
You are right, however, when you say that I don't have a particular definition of the word "strategy." That's because there's so much disagreement that it doesn't matter what you call it. One way or the other, you have a goal, and plan to get you there, and some sort of action to see it through. Beyond that, I don't see a lot of point in discussing whether this word or that word sums up that process.
Bruce,
I’ve never stated that your opinion is not valid. I simply asked that you clarify your position.
The above formula provides a definition for each variable: Ways, Means and Ends. For the purposes of this formula, these are the definitions. Had the formula read Strategy = ƒ(X + Y + Z), defining X as actions taken to achieve goal (Tactics), Y as resources available to the organization and Z as desired goal state and assumed risks, it isn't likely we'd be having this debate.
The point I was trying to make between a “fist” and “punch” is exactly as you stated: a thing vs. an action.
At this point were arguing semantics and it’s unlikely this discussion will add value to the original post. While we may not agree, I do appreciate your participation.
Mark Gallagher
Brand Expressionist®
[...] many circles, “strategy” has become a bad word, right up there with “creativity,” “innovation,” and [...]
Jorge,
I see your definition of strategy as being a textbook definition of tactics —"…positioning yourself to be able to do A, B or C depending on the situation." Help me better understand your point of view. How ow would you define Tactics?
Mark Gallagher
Brand Expressionist®