What’s so hard about strategy? Everyone claims to have one. There’s no shortage of books, articles, videos, advisors, and strategy-creating courses. But guidance on evaluating a strategy’s effectiveness or its long-term impact on organizational performance? That’s far rarer.
The first step in understanding strategy is recognizing why it often gets created. Many strategies emerge from reactive impulses: a sudden external shock, internal performance concerns, or a leader’s dissatisfaction with the current trajectory. Or maybe an executive doesn't like what she sees as the path forward. Or no one can find the "strategic plan" document created a few years ago. "We need a new strategy to respond to this threat."
Each of these scenarios has nothing to do with strategy. Why? Because they all relate to planning and not strategy. But, aren't we talking about the strategic plan? Unfortunately, no. Strategy and planning are two fundamentally different concepts and the creation of each takes a different path.
Strategy is not a plan full of numbers or a roadmap on a spreadsheet. As Michael Porter famously said, “The essence of strategy is choosing what not to do.” Strategy defines a pattern of behaviors and decisions that align resources and actions with long-term goals. It’s about determining an organization’s unique position in a competitive environment and the trade-offs required to achieve it. In contrast, planning focuses on execution—setting timelines, allocating resources, and tracking metrics.
Perhaps an oversimplification, but crafting a meaningful strategy answers four critical, less obvious questions:
1. What is the truth? Understanding the current state of your own and competitors is crucial. Where are we, why do we need to change, and what constraints or opportunities define our environment?
2. Where are we going? A strategy cascade defines high-level direction, not granular details. Are our aspirations, focus, economic model, operational capabilities, and management systems all aligned?
3. How will we get there? Execution and measurement depend on aligning actions with strategic intent. Have you crafted a business model and allocated resources consistent with your strategy or are you making do with what budget and customer base you have?
4. How will we evaluate success? An effective strategy requires ongoing evaluation and the ability to pivot. Poor execution is most often the result of a poor strategy.
True strategy is a specialized skill. It’s not just thinking about the future; it’s about choosing and committing to a path that creates enduring value while adapting to change. Without this discipline, organizations risk mistaking motion for progress.
Who should be involved in developing strategy, how it gets validated with stakeholders and competitors (yes, really), how it is cascaded through the organization, how it is evaluated and calibrated against the business model (no, really), and what conditions or trends suggest a revaluation of strategy (only sometimes)? These are discussions to have with an experienced strategy professional.