Why do executives have a superior alternative to pursuing the latest all-powerful strategy, often referred to as the ‘silver bullet’?
In essence, being a manager can seem like a futile endeavor. You might have a groundbreaking idea, but the organization might dismiss it. Alternatively, you could have a thriving business model, but competitors or a shifting market environment could undermine your unique selling proposition. Given these circumstances, it’s reasonable to seek a magic formula that can eliminate all organizational shortcomings and competition.
There’s a solution for every challenge, isn’t there? Imagine knowing the secret to molding organizations to align with your ideas. Or better yet, discovering a strategy impervious to competitors’ tactics. The latest management trends promise to provide the ultimate solution to all problems. For instance, the “purpose-driven organization” aims to eliminate divergent views and micropolitical conflicts. The “Blue Ocean Strategy” guides you towards the utopia of uncontested markets.
If hiring a consultant is beyond your budget, consider buying the book
Management trends purport to have deciphered the organization’s secret code or, depending on the mission, to have unlocked the secrets of the markets. Numerous management consultants pledge to fulfill their clients’ aspirations by applying these magical solutions, i.e., the trends and accompanying tools. If a consultant is unaffordable, your local bookstore will likely have the book you need!
Consider strategy as a pattern in a stream of decisions instead!
If executives perceive strategy as a brilliant plan, crafted by intelligent individuals (or highly compensated consultants) at the top of the hierarchy, which merely needs to be implemented by the lower ranks, they overestimate the capabilities of the hierarchy and underestimate the potential of lower levels. Strategy could also be viewed as a “pattern in a stream of decisions” (Mintzberg). In this context, strategy isn’t something that’s developed from scratch. Instead, it emerges from a series of decisions that demonstrate consistency over time.
Strategic decisions lay the groundwork for subsequent decisions. If one reflects on the decisions made over an extended period, one will identify those that enhanced organizational performance or market impact – and conversely, those that were detrimental. There’s almost always a path dependency where one decision sets the stage for the next. Strategic decisions can be defined as decisions that result in the allocation of significant organizational resources. Often, these decisions can only be classified as “strategic” in retrospect. Therefore, before you plan something entirely new, it’s better to examine what has contributed to your success. From there, you may decide to either continue with this pattern or intentionally disrupt it by making an initial decision that steers in a different direction.
Achieving a shared understanding may pose a challenge
While reframing strategy formation is the simpler part of this exercise, the greater challenge might be to cultivate a shared understanding within the management team about what has led to your success, and then proceed from there. Even in a company with a cooperative culture, reaching an agreement can be difficult due to differing local rationalities that stem from the division of labor, leading to varied judgments and interests. A shared understanding of the patterns of success could be beneficial. However, it’s not a prerequisite for a successful strategy.
The real quest lies in concerted action
As long as the members of an organization can agree on a unified course of action, disagreements, even on fundamental aspects of the business model, become irrelevant. The role of managers in strategy making is to advance things under conditions of uncertainty and competing local rationalities. Striving for concerted action amidst differing judgments and interests is what a management team should aim for. This requires well-prepared debates, suitable formats for these debates, and the courage to make decisions. If the debate is sufficiently wide-ranging and in-depth, the likelihood of organizational members adhering to decisions is certainly higher.
Remember, competing perspectives form the foundation of success
With the understanding of strategy as a pattern in a stream of decisions, executives can lower the expectation for strategies to be brilliant plans with answers to every question. Instead, they can focus on advancing things step by step. They can engage in discussions with their fellow managers, striving to reach an agreement on concerted action in light of differing judgments and interests, which in modern organizations form the basis, not the obstacle, for success.
