SPEED only matters if you are headed in the right direction.
Historically, strategy has been the defined journey from a clearly understood present to a desirable future. This involves an in-depth answer to the question: ‘Where are we now?’ and a description of where we would like to be in five years. Then we formulate a plan with clear goals, timeframes and responsibilities.
This is not only thoroughly inappropriate for the 21st century, it is fundamentally wrong.
It is a truism that technology shapes our world as profoundly as steam and then fossil fuels did in the past. These discoveries, together with other discoveries they enabled, changed where we live, how we live, how we earned a living, and how long we live.
Technology is not only creating more change; it is enabling swifter change. Think back five years, and consider how different your cellphone or PC was compared to what you use today. It is simply not possible to predict what technologies will exist, and how they will shape our world.
Even if we scaled the timeframe of our strategy down from five years to one year, our strategy would similarly be fundamentally wrong.
It matters where we focus our attention. Do you recall the epidemic of pregnancies that were visible when you and your partner were expecting a baby? Everywhere you went, there were so many pregnant women!
To respond to this epidemic, there were ads everywhere you looked that related to pregnancy and toddler raising. Ten years later, the epidemic was under control. Pregnancy slowed down to a trickle, and primary education was all people talked about and advertised.
Setting a one- or five-year goal is not a benign matter. It sets the focus and directs attention to the exclusion of all else.
The myth of the lengthy action plan
When an orthodoxy is deeply ingrained, it becomes extremely difficult to think differently. That strategy is a ‘lengthy action plan’ is an orthodoxy. Business schools teach this general understanding of strategy, and brilliant thinkers of the 20th century wrote of strategy in these terms.
Consider a medical orthodoxy. In the 1950s, Dr Alice Stewart discovered the tight correlation of childhood cancers to patients' mothers having been X-rayed during pregnancy.
Despite having published this in the authoritative Lancet Journal, it took 25 years before the British and American medical fraternity banned the practice. Conventional wisdom was that doctors were only helpful to people, and taking X-rays was a breakthrough and a completely beneficial technology.
What else can we, realistically, do if we need to set strategy for our companies?
Consider the process of losing weight. Once the decision is made, you commit to reading your weight daily. This is flawed thinking. Far more effective than focusing on weight would be to focus on food intake.
The scale is a lag indicator, a measure of what has happened, and food intake is a lead indicator, a measure of what will or will not cause weight gain.
An alternative approach to strategy for your business, is to focus on what will make the company as successful as possible in whichever future unfolds. This is a 180 degree flip, from a focus on a lag indicator to a lead indicator.
I call this approach a “Functional Strategy”. (It was the subject of my book ‘Strategy that Works’.) This approach is a focus shift from the outcome you aim for, to a focus on your business’s capability to respond successfully to the inevitable and unpredictable changes that will occur in your context.
As we hurtle towards an on-time, right-away and all-at-once environment, these changes could manifest sociologically, politically, economically, and so on.
Only when you focus on what you do control – food intake or the quality of your business to function appropriately – can you possibly succeed in what you don’t control.
Speed only matters if you are headed in the right direction. The right direction is a focus on your Functional Strategy.