Whether you know it or not.
Although the Covid-19 pandemic is far from over, there are growing signs of the end being in sight. Economies are recovering, vaccines are being rolled out and life is returning to ‘normal’ in a lot of ways.
This is leading to increasing talk of how organisations will emerge from the pandemic with boards and executive teams are giving greater focus to what their post-pandemic strategy should be. However, what many don’t realise is they already have a strategy – the question is, is it the right one?
We often think of strategy as the process of considering purpose & mission, analysing the market and industry, setting a vision, defining objectives and then developing strategies to achieve those objectives. This process, often conducted as a board/ executive retreat, is a way of establishing an organisations’ strategy.
However, consider this. Organisations that don’t go through this process still manage to operate and survive and in some cases even thrive. And some organisations with clearly articulated strategies don’t. Why?
It is a question of how we define organisational strategy and the difference between planned and actual strategy. Organisational strategy is not so much the well-presented, well-articulated glossy document signed off by the board, but rather the repeated activities and process within the organisation. It is the things people do on a regular and repeated basis that form the strategy of the organisation and determine its direction.
An organisation without a documented strategy can still be successful if the people within that organisation work in a coordinated way that leads to competitive advantage. Similarly, the most considered and well documented strategy in the world will not be successful if people don’t act in alignment with the vision and objectives.
Aligning strategic intent and activity is the critical difference and boards and executives have an important role. However, they must ask themselves what role they want to play?
Conductor or catalyst?
When we think of strategy as the repeated patterns of activity, then a spectrum of possible approaches becomes apparent.
At either end of the spectrum, strategy can be either deliberate or emergent. That is either, the realised strategy matches clear intentions and goals set by the organisation (usually by the board and executive) or it emerges from within the organisation but has no predefined intentions (although there is order) (see Mitzenberg and Waters 1985 paper for more on this).
Of course, there is a continuum between these two extremes where organisational strategies can have different attributes of each.
At the deliberate end of the spectrum, strategy is set from above, for example through the process described earlier. The board and executive set a clear vision and objectives relevant to the organisational purpose and context. Their role the is to act as conductor to coordinate resources, inspire people into action and monitor progress to ensure everyone is ‘playing the same tune’.
This type of approach works best where there is a relatively stable external environments and the organisation can exert strong internal controls. It also requires a strong focus on developing shared intentions amongst staff and ensuring alignment to the set strategy.
At the other end of the spectrum, the board and executive act as a catalyst for the emergent strategy. They set the internal environment and make resources available to allow strategy (patterns of activity) to emerge from the organisation. They provide a focal point (purpose, mission, values and possibly vision) around which activities take place. They then spend time monitoring the patterns of activity that emerge, encouraging those that are proving successful and limited those that are not.
This type of approach is often more effective in unstable or complex environments. It requires a strong cultural alignment around the organisations’ character (purpose, mission and values) and often requires a clear vision for the future.
Within these two extremes there are a range of other, more nuanced, possible approaches to strategy, where some activities are more controlled and others more experimental. The key question for boards and executives is to determine where on the spectrum they should sit – what strategic elements will be deliberate and what will be emergent.
This is a critical question, as getting it wrong could have negative results even with the best strategic intentions. Taking a deliberate approach in a rapidly changing context can render an organisation too slow to respond, resulting in loss of competitive advantage. Alternatively, taking an emergent approach without a clear focal point or appropriate internal structures can lead the organisation in unwanted directions.
Your post-covid strategy
Every organisation has a strategy. For some this is a well document, top down directed and deliberate strategy. For others, nothing is documented or discussed and the strategy simple emerges from the activities of people.
So, regardless of whether your organisation has spent time developing a post-covid strategy or not, it has one. People within the organisation will keep doing things and those activities will lead the organisation somewhere (although where might not be known until you arrive).
You have a post-covid strategy – the question is – is it the right one?
About the author … Dr Jason Talbot is a Fellow of the Governance Institute of Australia, a Chartered Accountant and the Managing Director of Graphite i2i, a specialist boutique management consulting firm which provides governance, strategy, business transformation, performance improvement, and M&A services to medium and large organisations. The company’s highly innovative business assessment and transformation methodology, 6C Framework, provides CEOs and Boards with a holistic view and understanding of their business’ capabilities, allowing them to readily identify areas in greatest need of attention or determine where future opportunities lie.
Should you require assistance undertaking a governance review:
Contact Jason on 0450 049 444