What Are Some Viable Strategy Models?
The terms strategy development and strategic planning mean very different things to different people. Not surprisingly, there are literally hundreds of models for developing a business or organizational strategy. In fact, the basic thrust and purpose of strategy is even conceptualized in disparate ways. For instance, strategy has been framed as:
A learning process: Views strategy as an emergent path that is created by management seeing what does and doesn't work over time and incorporating lessons learned into revised action plans. Examples: Learning Organization (Peter Senge); Emergent Strategy (Henry Mintzberg).
A living system: Conceives of human organizations as biological systems that grow and evolve in complex, organic ways that resist being treated like machine inputs and outputs. Example: A Simpler Way (Myron Kellner-Rogers & Margaret Wheatley).
A process of building upon strengths: Emphasizes the positive and building upon what's already working well instead of focusing on gap analysis and fixing weaknesses. Examples: Appreciative Inquiry (David Cooperider); Strength Management (Marcus Buckingham).
An alignment process: Orients the entire organization toward a focused, cohesive strategy that addresses not just the financial aspects of performance, but also the human, technological, and operational ones. Examples: Balanced Scorecard/Strategy-Focused Organization (Robert Kaplan & David Norton); Six-Box (Marvin Weisbord).
Cognition: Regards strategy formation as a mental process that hinges on aspects of neuroscience, such as human pattern perception and information processing. Examples: Strategic Cognition (Fran Ackermann & Colin Eden); Causal Cognitive Mapping (Gerard Hodgkinson & Nicola Bown).
Community development: Views strategy formation as a collective process involving various groups within the organization, so that the strategy ultimately reflects the community and culture. Example: Council Process (Jack Zimmerman & Gigi Coyle).
Competition or rivalry: Construes strategy development to be a rigorously analytical process aimed at improving an organization's competitive position in an industry. Examples: Competitive Strategy (Michael Porter); SWOT Analysis (Albert Humphrey).
Designed change: Regards strategy formation as a process of adapting the organization's internal strategy, structure, and processes to the external environment in order to achieve the best possible fit. Examples: Integrated Strategic Change (Christopher Worley, David Hitchin, & Walter Ross); Strategic Fit (Cornelis de Kluyver); Gestalt Theory/Field Theory (Max Werthheimer; Kurt Lewin).
Networking (alliance creation): Views strategy as the art and science of discovering new sources of profitability in networked industries. Example: Delta Project (Arnoldo Hax & Dean Wilde).
Positioning: Approaches strategy as a process of creating, focusing upon, or redefining a market segment or niche in such a way that a company can own or dominate that market. Examples: Blue Ocean Strategy (W. Chan Kim & Renée Marbourgne); Value Disciplines (Michael Treacy & Fred Wiersma); Long Tail (Chris Anderson).
Power or politics: Conceptualizes strategy as a negotiation process between power holders within the organization, or between internal and external stakeholders. Examples: Transformational Change (John Kotter); Managing with Power (Jeffrey Pfeffer).
Process improvement: Holds that strategy creation is less a response to external competition than a process of ongoing internal improvement in the interests of quality, productivity, or performance. Examples: Six Sigma (Bill Smith); Total Quality Management (Genichi Taguchi); Continuous Process Improvement (W. Edwards Deming).
Statistical insight: Proposes that competitive strategy should be data driven through the application of sophisticated quantitative, statistical analysis and predictive modeling. Example: Competitive Analytics (Thomas Davenport & Jeanne Harris).
Structured analysis: Views strategy formulation as a formal process that follows clear-cut steps based on in-depth research and structured analysis. Example: Scenario Planning (Herman Kahn; Pierre Wack).
Value creation: Sees strategy development as a collaborative process whereby value is constantly co-created and co-managed with stakeholders and customers. Examples: Co-Creation (C. K. Prahalad); Customer Equity (Robert Blattberg).
Visioning: Deems strategy to be most viable when it's co-created by stakeholders through a process of envisioning a better future and taking individual responsibility for the initiatives needed to get there. Examples: Future Search (Marvin Weisbord & Sandra Janoff); Search Conference (Fred Emery & Eric Trist).
Which strategy approach should you use?
No matter what the popular strategy books say, no one strategic approach is best for all organizations. In fact, we've found hybrid approaches are often the most workable. Before specifying a strategic planning process for an organization, it's important to evaluate several factors including:
- Strategic objectives & timelines
- Organizational culture & life stage
- Organizational structure
- Leadership involvement
- Environmental & competitive factors
- Planning resources
- Planning team composition & roles
- Customary working approach
The whole point of the planning process is to improve the organization's future performance. This requires some degree of organizational assessment to begin with in order to choose and design a best-fit strategy development approach.