04 Sep 2013  What Do YOU Think?

How Relevant is Long-Range Strategic Planning?

Summing Up: Jim Heskett's readers argue that long-range planning, while necessary for organizational success, must be adaptable to the competitive environment. What do YOU think?

 

Summing Up


How Can Strategic Planning be Adapted to Changing Needs?

Strategic planning concepts and the notion of long-range planning will continue to be integral parts of responsible management. But they may require a substantial rethinking if they are to remain relevant. For example, they will have to be applied more selectively, depending on such things as the industry, the nature of competition, and the speed with which a particular organization's environment is changing. And there is a question about whether a sufficient cadre of managers is being prepared to do this. These are conclusions resulting from a reading of responses to this month's column.

In defense of strategic planning, Greg Martin said, "Same story, different day: in times of change it is practically irresistible to not throw the baby out with the bathwater. While technology has and will continue to accelerate the pace of change…it can also be cleverly leveraged to facilitate an iterative, evergreen process of strategy formulation and implementation."

David Wittenberg added, "Strategic planning, especially long-term strategic planning, is no less necessary in a fast-changing world. Clayton Christensen reminded us that the root cause of every business disaster is mistakenly pursuing short-term goals ahead of long-term ones." Daniel T. C. Lee commented, "Traditional or not, strategic planning has never restricted new innovation…. The issue is the extent and depth of the analysis."

Several argued along with Munyaradzi Mushato, who said, ''the need for a sustainable strategy is actually higher in a volatile market space … why deliberately go out to plan to build a short-lived competitive strategy?" Paul Tiffany commented that the question we should be debating revolves around the tools that are most appropriate to the task today, such as David Teece's ''Dynamic Capabilities'' model.

Huw Morris was among those suggesting adaptation. He regards current strategic planning concepts as relevant, but warned that they need to be used to promote agility. For example, he said, ''by strategy task forces that 'hack' rather than as part of a long annual strategic planning process." Gary Johnson put it this way: "Competitive advantage and a business without strategy-one that is in constant reactiveness, seem to be an oxymoron; a 'living' strategic plan will always help a business be more competitive." Shadreck Saili said that while long-range strategic planning may still be relevant to some degree, ''the frequency of monitoring and evaluating of strategic plans becomes therefore a relevant factor to consider." Edward Hare suggested that, "What organizations need to do is break old habits of practicing planning as ceremonial processes that are conducted periodically. That'll probably happen … Those that don't just won't survive."

This led to the question of why managers have been reluctant to adopt new methods of planning. Janice Maffei framed the case by saying that "We need to influence leaders to envision longer term possibilities while creating short term experiments." Shann Turnbull warned this may not be easy, commenting: "The establishment of 'smaller, faster, more agile organizations' is inherently a governance problem…. The problem is that network governance is not taught in business schools or any other faculties." How can strategic planning be adapted to changing needs? What will it take? What do you think?

Original Article

From time to time thinking converges around a set of ideas. For us this month, the topic is strategy planning and organization. Conventional thinking and organization that has encouraged us to seek sustainable competitive advantage in the past is being questioned in today's business environment. Some are even suggesting that the mind set that has given us strategic planning concepts such as SWOT (strengths, weaknesses, opportunities, threats) analysis, the "five forces," growth share matrices, five-year plans, and an emphasis on core competencies of the firm may lead to competitive disadvantage in a technology-transformed world in which markets, employee and customer mind sets, and innovations, evolve at a rapid rate.

The conversation was stimulated (can it be 16 years ago?) by Clayton Christensen's work leading to his book, The Innovator's Dilemma. In one sense, the book was mistitled. Some of its most salient material concerned issues confronting large corporations facing innovative upstarts with disruptive ventures, the non-innovator's dilemma. But it also dealt with the challenges of achieving innovation in a world of entrenched ideas about how products are developed and used. Implicitly, the book questioned traditional concepts of strategic planning in an environment populated by increasingly innovative and agile competitors.

Now comes a new book, The End of Competitive Advantage, by Rita Gunther McGrath. Hers is a frontal attack on accepted strategic planning methods designed, in her opinion, for another time. These are methods based on the presumption that competitive advantage is sustainable. It's a presumption that she claims "creates all the wrong reflexes" in a world in which the best one can hope for is "transient competitive advantage."

McGrath's prescription for achieving transient competitive advantage includes such things as smaller, faster, more agile organizations--and where management-by-consensus is a thing of the past. The emphasis is on marshalling rather than owning assets, including talent. In order to ensure the appropriate deployment of these assets from one opportunity to another, it will be necessary to recentralize control over the resource allocation process, moving it out of strategic business units (SBUs). It raises questions about the relevancy of SBUs as opposed to transient teams as a form of organization.

These organizations engage in "shape shifting" based on systematic innovation and the constant testing of assumptions, all required to maintain transient advantage. They are organizations designed to create and test options, practicing "continuous deployment," doing things "fast and roughly right" rather than relying on strategic planning as we have known it.

McGrath makes her points forcefully, but laments the slow rate at which these changes are being adopted in large organizations. If these ideas are so powerful, she asks, "why hasn't basic strategy practice changed?" Is her thinking on target but just a bit ahead of the curve? How relevant is long-range strategic planning and its assumptions of sustainable competitive advantage? What do you think?

To read more:

Clayton M. Christensen, The Innovator's Dilemma (Boston: Harvard Business School Press, 1997)

Rita Gunther McGrath, The End of Competitive Advantage: How To Keep Your Strategy Moving As Fast As Your Business (Boston: Harvard Business Review Press, 2013)

Comments

    • Huw Morris
    • CEO and Founder, Efficienarta Limited

    My sense is that our traditional strategic planning tools and techniques can continue to inform strategic direction decisions; however, they need to be used to promote agility rather than in ways that can be barriers to flexible reallocation of resources etc. to meet rapidly evolving customer opportunities. For example by strategy task forces that 'hack" rather than as part of a long annual strategic planning process and facilitiate more effective "continuous deployment," doing things "fast and roughly right" etc.

     
     
     
    • Paul A. Lepley
    • Retired (MBA '71)

    The idea "to recentralize control over the resource allocation process" reminds me of the rise of conglomerates in the 1960s: Litton Industries, Gulf+Western, etc. I recall the resentment of managers who saw resources (especially cash) being taken from their business unit and being placed into the corporate pile, which was then used to buy other businesses. There is no assurance that those in corporate staff positions will allocate such resources to best advantage.

    Central planning was a failure in the USSR.

    Be cautious.

     
     
     
    • Shadreck Saili
    • Phd Candidate, Atlantic International University

    This is a challenging insight you have brought out prof. However it's true that long range strategic planning is beginning to loss grip in terms of being above board as numerous decisions (emanating from the long range plans)are being made along the life of stretegic plans. The increasing dynamism of business /organisational parameters has totally enhanced the sensitivity of all assumptions we make in drawing up long range plans such that every single shift of an assumption/factor (which may be termed low risk) has increased potential of derailing progress.

    In this light, and while i submit that long range strategic planning may still be relevant to some degree, i feel the time has come for us to modfy the traditional way of dealing with,preparing strategic plans and managing the plans. We are in an era of moving targets and the institutions that move within acceptable speed survive. The frequency of Monitoring and evaluating of strategic plans becomes therefore a relevant factor to consider.

     
     
     
    • Uday Kagal
    • Proprietor, Innovation Social Consultants

    Couldn't agree more but I think it is a bit of both. We cannot do planning without strategy, but the strategy must be shape-shifting in order to constantly adapt to the fast-changing environment. There must be some givens and some not-so-givens and the challenge will be to discover which are which.

     
     
     
    • Harsha Desai
    • Professor of Management, Loyola University Maryland

    For exactly the reasons Prof. McGrath states, over the years I have found use of dynamic scenario planning in strategic thinking much more useful while also using static analyses of SWOT and Prof. Porter's industrial dynamics take (five forces + complementors).

     
     
     
    • Gary Johnson
    • President, Gap Solutions

    I believe a business that truly supports well thought-out strategic planning is being proactive towards achieving its growth goals and has a competitive advantage over non-strategic businesses. To not be proactive is to be reactive. I believe a successful business utilizes both proactive and reactive planning, however, a business that is continually reactive is one commonly in crisis management and will accomplish less than a strategic thinking company, and I add, implementer of those strategies. If something has shifted, I believe it is not the need for strategic planning it is that strategy is now fluid. When change wasn't occurring so rapidly, as it is today, a company could set its goals and rely quite competently on the strategies it developed to achieve those goals; only the tactics to achieve the strategies remained fluid in order to address changes or shifts impacting the business, i.e., customer need, etc. That's where rea ctiveness applies to a successful business. Today, the strategic goals remain fixed, and strategy has joined with tactics as being fluid. In order to address rapid change, companies today are developing a three-year strategic plan and not the more traditional five-year plan. Technology is here to stay and will continue to tremendously aid businesses in achieving their goals, technology is a means, a strategy, not the end. Competitive advantage and a business without strategy- one that is in constant re-activeness, seem to be an oxymoron; a "living" strategic plan will always help a business be more competitive, and more successful.

     
     
     
    • Bill Shirley, BT MCC.
    • CEO, In Search of Eagles, Inc

    From my most current experience, the "sustainable competitive advantage" strategy appears to require an Agile, Enthusiastically Engaged team. Only when such a team listens to the customer's ever-evolving expectations and experiments (successfully) with adaptive changes in the business model that exceed those expectations does the "transient competitive advantage" become sustainable.

    But, as Alvin Toffler pointed out in 1970 (in Future Shock): "the rate of change is accelerating." The evidence is clear: the speed of change has no known terminal velocity! Our human nature, being what it, causes us to create ("reliable") systems to support our sustainable success. Our transient success appears to be sustainable once our last period of non-success fades from our short-term memory. Paradoxically, that is the moment when our "sustainable success" becomes non-sustainable or "transient."

    The sustainable competitive advantage strategy assumes a finite (zero sum) game market environment while the transient competitive advantage strategy assumes an infinite game market environment. The strategy required to prevail in an infinite game environment is very different from that required to prevail in a finite game environment. We have been encouraging our clients to think in terms of prospering in an infinite game market for some time.

     
     
     
    • Geoff Clarke
    • none, none

    I write from distant left field- so rule me out from any insight if you like.

    However

    The problem with strategic planning is the assumption that the future can be forecast and therefore future action can be planned. That belongs to Soviet style illusions.

    What Porter gave/ gives us is a good framework to work out where we are, where our competitors are, and at least a shot of respective trajectories, hence of what options are available to us.

    'No plan survives intact the first contact with the independent will of the enemy'

     
     
     
    • John Arnott
    • CEO, Nimble Ventures Inc.

    Caveat; I have not read Rita's book, yet. This is a fascinating subject and I shall get her book asap. But one thing I want to add to Jim's comments is the shift in management style exhibited by some leaders. One may think that GE would be one of the biggest ships around but Immelt has done what I think is masterful - management in public - he is so well published that no manager could ever pretend to not understand. Staff, suppliers, competitors, all know what he expects and unless they simply don't read, he gets the culture distributed. He's turning that aircraft carrier like a, well not a go-cart, but something far less unwieldy.

     
     
     
    • Jim Briggs
    • President, Ranger Machining, LLC

    Large companies are victims of being large. They do not readily adopt strategies for becoming more quick and agile because they lack the quickness and agility to do so. The chicken-and-egg problem. Also, breaking into smaller, more nimble business units requires people to give up power. People are typically reluctant to give up power, and can present many sound and sensible reasons why their business unit should not be broken up. Government is an extreme example of this phenomenon.

     
     
     
    • Janice Maffei
    • Partner/Owner, VisionFirst

    We see Maslow's observation about the person with a hammer seeing every problem as a nail alive and well in many organizations. There is an illusion of control in the strat planning process - forms and templates, deadlines and reviews. Where are the new ideas, the bold thinking that will create the transient advantage? Actually, it is transient - visionary thinkers leave in droves, or "retire" while still on the job. We need to influence leaders to envision longer term possibilities while creating short term experiments - rapidly prototyping their way to today's transient competitive advantage.

     
     
     
    • Gerald Nanninga
    • Principal Consultant, Planninga From Nanninga

    My contention is that strategic planning allows a company to act faster, making strategic planning even more valuable in today's environment. Without strategic planning, a company is left with two options--reaction or randomness. Reaction is a rarely a path to leadership (as other contributors have pointed out) and randomness (considering everything and moving in all directions hoping something will stick) is time consuming and resource wasting.

    Strategic planning speeds things up by pre-defining boundaries and pointing towards where a company should increase its emphasis to build competencies. As a result, a company doing strategic planning no longer has to re-invent the wheel whenever the market shifts. Time is not lost in starting with a blank whiteboard all the time. The boundaries are set and you quickly get down to business within them.

    In addition, by knowing where a company adds value, you know how you have to play to win. This leads to two benefits. First, you can act faster, because you know which way to go in advance (towards your competency edge). Second, you are more likely to succeed, because you are leveraging a business model that has an innate advantage due to the superiority of the business model competencies. Rather than always being in a race with me-too products built by indistinguishable companies, you are building superiority through unique strengths.

    The problem is that most of the work done today in the name of "strategic planning" attacks the wrong issues. It looks at financial targets rather than what trade-offs are necessary to build a unique business model that can be applied in multiple directions (depending on market shifts) while providing an edge over the me-too chasers.

    Under Steve Jobs, Apple had a well-defined strategy: develop high-end closed systems which excelled in elegance, simplicity and coolness. This focus made is easier to know what to focus on and helped Apple to know where to build competencies in order to win (far better than reaction or randomness).

    I speak more about this topic here: http://planninga-from-nanninga.blogspot.com/2013/08/strategic-planning-analogy-509-high.html.

     
     
     
    • munyaradzi mushato
    • Corporate Trainer, The Cotton Company of Zimbabwe

    I partly agree and partly disagree with the article. Firstly, perhaps foremost, why deliberately going out to plan to build a short-lived competitive advantage? There is no everlasting competititve advantage and sustainability of any competitive advantage is relative. The idea of strategic planning is therefore to build a competitive advantage that has a longer working life, i.e that which will take longer to be imitated by rivals, for examples creating new demand in new markets and building unique capabilities to satisfy that demand. This is what W. Chan Kim and Ren?e Mauborgne called the Blue Ocean Strategy. So the longer it takes before a competitive advantage is erased , the stronger that competitive strategy is. I do not see the logic against that way of thinking. Secondly, I do agree that change is now taking place at a much faster rate than before, especially technology-induced change. What that means is organisations need t o build and sustain change agility capabilities that will allow them to be more adaptable to their environment by moving with or ahead of change. that is the only way to build sustainable competitive advantage. Infact ,the need for a sustainable strategy is actually higher in a volatile market space.

     
     
     
    • Steve Flick
    • Q9C Quality Consulting

    I have not read the book so I don't know if the author has dealt with the subject of "risk appetite". Businesses are generally begun by individuals who understand the risks involved in getting their ideas to fruition; they are risk takers but are not reckless. As their businesses become successful and continue to grow, however, the company's risk appetite decreases. They become more cautious and conservative, wanting to hold onto (or nurture) what they have. I believe this is a natural course of events.

    As businesses become risk averse, their desire to maintain the status quo increases. Change becomes increasingly difficult, which affects strategic planning. Thus, competitive advantages are lost.

    If we could all stay small and nimble...

     
     
     
    • Daniel T C Lee
    • Director, Avondale Grammar School

    Strategic planning and focus on core competencies may lead to competitive disadvantage? Traditional or not, strategic planning has never restricted new innovation. In fact SWOT analysis / Cost Benefits Analysis and Risk analysis is constantly done in both long term and short term decision making. The issue is the extent and depth of the anlaysis and not if these lead to a competitive disadvantage. Considerations must include the dynamic environment, the expectations and timing of changes. There must be a certain level of confidence of survival, whether at the individual level or the organizational level, before innovators embark on high risk ventures and accept anticipated failures. Many companies as well as VCs have a diversified portfolio, and create successful cash cows before putting their share of funding into 'unchartered waters.' These clearly indicate the need for long term strategic planning to achieve sustainable competitive advantage in the bigger picture. On the micro perspective however, it is necessary to provide freedom for innovation within a defned framework in order not to stifle creativity and to be able to react quickly to changes.

     
     
     
    • Nick Chipman
    • Partner, PwC-Australia

    Perhaps we should be thinking that strategy is becoming more associated with a journey of discovery than the original notions that facts and absolute process rigour were/are the key to successful strategy selection.It is also worth thinking about the the need for real options techniques being used more often where flexibility has value.Another thought is the willingness to concede that offensive and defensive planning -and strategy selection-will become the norm.More of the variables we thought we had some "control" over or at least understood move more quickly or in different ways than our conventional systems of detection and monitoring make sense of-hence the need for the cues and signals of discovery becoming critical to adaptive-or in this article-transient competitive advantage.From a practical perspective-how does one then run and direct the business/organisation??

     
     
     
    • Paul Tiffany
    • Haas School

    The question is not about the need for organizational planning; there always was and always will be such a demand. Rather, the question you should be debating revolves around the tools that are most appropriate to the task today. Clearly, the "old" approaches (SWOT, Porter, et al) are no longer viable, at least not as stand-alone vehicles. They may be necessary, but are not both necessary and sufficient; they need to be supplemented as the principal problem they have is that they are static tools in a highly dynamic environment. "New" planning tools are beginning to emerge (e.g., David Teece's "Dynamic Capabilities" model), but none have yet to capture the broad following that Porter, et al did some 30 to 40 years ago (change takes time, especially for academics!). But they are emerging.

    Finally, one minor point: it was not Clayton Christensen who "stimulated" this conversation 16 years ago. You need to dig deeper, as Professor James March (Stanford GSB) got the bandwagon rolling in his seminal 1991 article on "Exploration and Exploitation" (in Organization Science). You can check with HBS's own Michael Tushman on this, as he-- along with Stanford's Charles O'Reilly-- have been pushing the problem for years with their various "ambidextrous organization" articles.

     
     
     
    • Greg Martin (OPM36)
    • President, Optimal Performance Group

    Same story, different day: in times of change it is practically irresistible to not throw the baby out with the bathwater. While technology has and will continue to accelerate the pace of change--and the associated competitive consequences--it can also be cleverly leveraged to facilitate an iterative, evergreen process of strategy formulation and implementation. In other words, traditional, so-called static tools (SWOT, etc) can be animated; technology allows real time, on-the-fly updates to planning and implementation at whatever cadence best fits the market imperatives the organization faces. I say that based on the ongoing success our clients are experiencing using the exact approach I've described. j

    I'm patiently awaiting empirical evidence that time-tested laws of business "physics" have changed; I think it will be a long wait. In the interim, our clients will continue enjoying competitive advantage based on deploying smarter, nimbler, technology-enabled approaches to managing their strategy/execution processes.

     
     
     
    • Kapil Kumar Sopory
    • Company Secretary, SMEC(India) Private Limited

    Long-term strategic planning must not be for a very long-term. In my view, even five years is a very long period. We prepare three year strategic plan and suject it to a regular review effecting changes felt necessary after proper deliberations. With brisk changes occuring in various areas concerning all of us, relying totally on a once-created plan will not do. Even changes - by way of improvements - in technology affect operations and thus cannot be ignored.

     
     
     
    • Shann Turnbull
    • Principal, IntInternational Institute for Self-governance

    I agree with "McGrath's prescription for achieving transient competitive advantage includes such things as smaller, faster, more agile organizations". This is how the Vietnamese won their war against a superior equipped USA.

    However, for the reasons raised above by others, the solution proposed by McGrath "to recentralize control over the resource allocation process" would be counter productive.

    System science teaches us that even survival in dynamic complex environments requires a requisite complexity in organisational control and communication channels. This is incompatible with conventional centralised command and control management systems.

    The establishment of "smaller, faster, more agile organizations" is inherently a governance problem not one of management. The problem is that network governance is not taught in business schools or any other faculties.

    There is in addition, a chicken and egg problem because the market for this education has been negligible. As a result business school professors have not acquired the knowledge to teach it. I would be delighted to share my groundbreaking research to equip HBS to be a leader in this field.

    An introduction to network governance was published this year in my book chapter: 'A sustainable future for corporate governance theory and practice'. In S. Boubaker, B. Nguyen and D. N. Guyen (Eds.) Corporate Governance: Recent Developments and New Trends, pp. 347-368, Springer-Vertag, Heidelberg 2013. Book My chapter is sold separately for 29.99 Euros from http://link.springer.com/chapter/10.1007%2F978-3-642-31579-4_15. Working paper: http://ssrn.com/abstract=1987305.

     
     
     
    • Edward Hare
    • Retired Director, Strategy and Planning, Fortune 250 Manufacturer

    I sense a disconnect regarding semantics.....an all too common phenonenon. Like, "sustainable"....I have never considered the term to mean forever. But Ms. McGrath's point is well taken if she laments rigid processes for "strategic planning" and cast-in-stone conclusions that may result from them. What's truly important is not planning per se, but strategic THINKING which needs to be practiced continuously.....because the world and ones competitors are in flux all the time. The smartest managers consider what's changing lately and how those forces affect the business. What organizations need to do is break old habits of practicing planning as ceremonial processes that are conducted periodically. That'll probably happen.....even in big, complex, and arthritic organizations. Give it time. Those that don't just won't survive. It's Darwinian.

     
     
     
    • Shyamsunder Panchavati
    • Chief Facilitator, Capacity Building & Development

    Conventional strategy is as unconventional as the phrase "Convention" itself. What is a disruptive strategy today would in course of time be a part of the convention.

    When you attack the conventional strategy,you have to qualify your statement by relating it to a time frame.

    Competitive advantage is always transient,as the competition is always trying hard to reduce the gap and nullify your advantage. Hence when you talk about competitive advantage you automatically acknowledge that it is transient.

    Competitive advantage is tenancy not permanency.

    You can never own it.

    Long range strategic planning is good for healthy sustenance. But you need short range innovative guerrilla strategy to surprise the market and the competition and score an edge.

    This should be repeated every time with a new and innovative short range strategy, supported by faithful Operations,Implementations, and various supply chains.

    Shyam

     
     
     
    • Dennis Nelson
    • Internal Consultant, SFS

    Sustainable Competitive Advantage never existed. The concept too often resulted in the demise of entities with fewer resources than their self-proclaimed competitors. Pursuing the illusary competitive advantage reduced the resources available to pursue sustainable symbiotic advantages through which more competitors could thrive and make more significant contributions to their stakeholders. For the symbiotic pursuit, long-range strategic planning was and is relevant.

     
     
     
    • Wayne Lingard
    • CEO, Process Way Consulting Ltd

    First off I would like to disagree with doing things "roughly right", that might be all well and good in a technological environment, (yes i have come to adjust to the fact that these products are never perfect, so my assumption of their quality level has dropped dramatically) but if my truck I just purchased was "roughly right" I would not be happy! If I am a shareholder "a roughly right strategy" is also not filling me with joy. I also haven't read as to what industries the author is applying this to? A six month strategy in the smart phone market is one thing, a six month strategy in the electricity providing arena would be complete nonsense. Strategy is in itself not a nature of what you are, or even want to be, but the environment that you exist in, and so long range planning is not dead nor will it die. Competitive advantage is never sustainable and it never has been. Yes start ups come and bring new products and services to market..guess what they always have done. There is nothing new here. Its a book regurgatating the simple and obvious. As the untitled fellow states below, 'No plan survives intact the first contact with the independent will of the enemy', quite right but if you know the environment better than him then you increase your chances of winning. Your environment is driven by your customers and unlocking their deepest desires, (not the one with whips and stockings i might add) but what they really want from you, their emotional reaction to your product or service can tell you all you need to know about where to go next. The "environment" is the customers emotional response to products and services. Emotions create the atmosphere around us and understanding our customers emotions can change our strategy long term or short depending on industry. The 5 forces or SWOT dont allow for any emotional content, so as contingency theory states it aint c omplex enough! The models need to be redrawn, is what i take from this and so they should be. Online shopping is a completely different emotional response pattern than going to Harrod's or Walmart. If somebody would further develop these models then that would be interesting. So to finish i pose the questions: Are tactics becoming emotions? or are we learning to react to customer emotions faster? If so how does the boardroom predict and control those emotions to create competitive advantge if only fleetingly?

     
     
     
    • Peter McCann
    • Consultant, McCann Corporate Consulting Associates

    Long-range strategic planning was only ever relevant for large companies with high fixed costs; and, it still is relevant for those companies. One cannot engage in short-term, 'turn on a dime', flexible planning when managing a cement, oil pipeline or ship building yard. You are what you eat; a company is what is buys and owns.

    However, the rest of the business universe - then and now - must be adaptable; and, the best are.

    The position along the continuum from long-range planning to free-wheeling adaptability is determined by the investments, the industry and the image / mindset of the executives.

     
     
     
    • Rudolf Rinze
    • Managing Director, ComBucasa

    "Planning is the inteligent cooperation with the unavoidable," remarked Stuart Chase in his The Proper Study of Mankind back in 1948, when he referred to the hectic pace of the complexity of modern life and the exponential magnitudes of growth. To me these thoughts become quite fitting with Rita McGrath and her new work and also with what Stuart sets as the cultural delay before new creations or innovation all around. ie:I do see with high skepticism today's still prevalent ways of compromising with 25 or even 50 years terms busines contracts, when change is now waitng around the corner. We see today change as not gradual as it used to be but rather what may be termed as quantic or somehow brutal new ways. So let's adopt strategies to cope with permanent, by the minute change...

     
     
     
    • David Wittenberg
    • CEO, The Innovation Workgroup

    Strategic planning, especially long-term strategic planning, is no less necessary in a fast-changing world. Clayton Christensen reminded us that the root cause of every business disaster is mistakenly pursuing short-term goals ahead of long-term ones.

    The strategist determines what victory looks like, which battlefields to fight on, what milestones to target along the way, and where to allocate resources. These decisions are based on judgments about the future, which, ideally, will draw on observed facts as well as the intuition of wise business leaders.

    Organizations succeed when their strategic judgments and decisions are correct. They fail when their judgments prove to be incorrect and they refuse to change their strategies.

     
     
     
    • Sanjay Ramdas Kambekar
    • Dy.GM(Business & Tech Coordination) & Head People Power Excellence Center., Ambuja Cements Limited - Holcim Group Company

    it is 100% true that the mind set that has given us strategic planning concepts such as SWOT (strengths, weaknesses, opportunities, threats) analysis, the "five forces," growth share matrices, five-year plans, and an emphasis on core competencies of the firm may lead to competitive disadvantage in a technology-transformed world in which markets, employee and customer mind sets, and innovations, evolve at a rapid rate.

     
     
     
    • Meade Sutterfield
    • Serial Entrpreneur, my own

    I think many companies, especially larger ones, mistake the process that leads to an annual budget process for strategic planning. A strategic plan is generally no more than a one page expression of the focus of the busniess opportunity facing the company, business unit or product line with some rudimentary numbers. This flexible plan will continuously evolve along with the markets, the technology, the competitors and outside opportunities. The once a year dreaded exercise of preparing a detailed budget for company execution is the reality of financial interdependence but is not strategy.

     
     
     
    • Jeremy Pooley
    • Strategy Manager, AMP

    My company is 149+ years old and naturally suffers from all the issues of incumbent thinking that Christensen and MaGrath identify. It used to be called ambidexterity - the need to manage for today and plan for tomorrow. This is often hard in SBU's driven by short term profit demands where clarity of strategic thought is weak and the concept of 'strategic thinking' is not really valued.

    The idea of sustainable competitive advantage is in some senses a figment of someone's imagination. Employees don't believe it, and amid all the downsizing don't experience it. We all know customers don't value anything except regular high quality service that does the job they want done. Technology and social media is changing the normal pace at which every market evolves.

    The things that matter are how you understand trends and uncertainties, invest in capability, and harness agile teams to experiment and deliver products, services, solutions and experiences to give customers what they want and need quickly, and then keep on doing this.

    This is a culture and mindset led proposition that focuses on constant resource swarming to think ahead outside of BAUs. BAU's in my view need to focus on delivering these experiences and need lean processes to do it. Their task is different and the skills they need are different.

    It is of course possible to do both but high quality leadership is the X factor needed to do it. By this I mean leaders promoted to positions who drive their teams to think long term and manage short term and who are comfortable empowering diverse teams to come up with answers - strategic facilitators and good managers. This often means leadership TEAMS not individuals as it's rare to excel at both strategic leadership and BAU day to day leadership. The super leader may not exist. But very strong leadership teams backing by strong culture are the source of sustainable drivers of competitive advantage and strategy.

     
     
     
    • Donald Shaw
    • President, Donald E. Shaw, P.E.

    Strategic Planning is necessary in times of rapid change. But it can no longer be based on targets derived mostly from historic data. Nor can it be directed toward intuitive ideas, although intuition can always help. Strategic Planning has to be directed toward being sufficiently flexible to adapt to whatever change may bring--sort of like the Marine Corps "Improvise, Adapt and Overcome." It seems most people today have not realized that the change we are now experiencing is more like the change of the industrial revolution than a cyclic business environment. Also today's change is from linear to extremely nonlinear which raises issues for analytical methods in planning. The only strategy to deal with today's change is to have a plan that is based on rapidly adapting to change.

     
     
     
    • George Yurieff
    • General Manager, Nevsky Industrial Corporation

    Long Range Strategic Planning (LRSP) is as relevant as the goals, industry, market and management philosophy of the organization itself: could be really important, could be not practical at all. What's more important is that well thought-out and implementable LRSPs be funded, be flexible, be able to go with the flow and bend with the ever shifting winds of change in the market. If not, they will not be a LRSP but just another speach given by a highlevel executive at a high-profile corporate function.