Strategy and change

I strategy and changeteach a course on strategy in a local management centre so I am keen on the link between strategy, change and operational excellence. I have just read a review in the Economist of a new book on strategy by A. G. Lafley and Roger Martin in which they describe how they turned Proctor & Gamble around and delivered significant shareholder value. In the book they describe six common strategic errors and it occurred to me that these also described six failed approaches to change.

Creating a strategy which enables a company (or non-profit organisation) to do better than their competitors is the holy grail of senior management; and supports a whole industry of consultants, business schools and guru professors.  Actually implementing a strategy, assuming it is different from the current one, starts with changing the culture, capability and operational behaviour of the organisation. So a direct link between failure strategies and change failure is not too surprising. It does, however emphasise the important role of senior managers in creating successful strategies to following through with successful change. A point I will come back to.

No doubt, your interest is piqued by the six common strategic errors, how that might look in change failure; and most likely, can you identify a similar situation in your own organisation. So here is my analysis on the six common strategic errors:

Do-it-all strategy: trying everything so nothing is prioritised. The organisation has change going on everywhere, sometimes chaotically, always without prioritising the allocation of resources. Leading to change fatigue and nothing significant actually gets changed.

Don Quixote strategy: attacking the strongest competitor first. Focused change, yes. Delivering benefits to the organisation, no. All of the business benefits are seized by other parties such as suppliers and customers.

Waterloo strategy: attempting to fight in too many markets and customer segments at the same time, regardless of the relative advantages. Here change is always urgent but again there is no priority which enables the effective allocation of resources and we end up with insignificant change across a broad front.

Something for everyone strategy: tries to sell everything to everyone. Same situation as the do it all strategy; though this can look appealing as the change is always â??customer drivenâ??; itâ??s just that there are too many customer segments to tackle at the same time.

Programme of the month strategy: follows industry and theory fashion, and is often accompanied by frequent changes in top managers. This strategy results in focused change, but the change isnâ??t seen through to the end when benefits are realised; instead new priorities and changes overtake current changes and nothing is actually achieved (except the expenditure of resources).

Dreams that never come true strategy: ambitious visions are not translated in clear choices and priorities. Change is started with blue sky visions and then goes straight to implementation (projects) to do things without the prior design stage that puts in the detail (operational behaviours, benefits, etc) needed to succeed.

Successful strategy a prerequisite for successful change

Lafley and Martin do describe the key elements of a good strategy and they are keen on employing the best ideas of strategy management thinkers (I believe these thinkers have some very good ideas).  The essence of their approach is to make strategic choices about where to invest in future markets and products based on the unique strengths of the company with respect to the competitors in those markets. Then follow through with a focused set of priorities to manage those things that matter and not manage (strategically) those things that donâ??t matter.

The same is true of successful change. Make strategic choices about what to change and what not to change. Change the things that will have the most impact on the strategic objectives of the organisation, donâ??t change things that wonâ??t. This way you prioritise the finite resources for change on the things that will be most likely to deliver the chosen strategy. All you need is a well-chosen strategy to set out the objectives for change!

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