From a historical perspective, strategy is an exceptionally fascinating subject. The concept of strategy was created in Ancient Greece as part of warfare. Ancient warlords and philosophers understood that successful action required well thought-out plans. Sun Tzu, the Chinese master of the art of war, created the classic work The Art of War, which contained the principles of victorious strategy. In ancient Greece, the philosopher Socrates emphasised debate and reflection as part of decision-making, and his students Plato and Aristotle extended the idea to society and politics.
Today, strategy is mostly understood as a plan to achieve desired objectives and a broader goal (vision). Often this requires finding or building a competitive advantage, which is not easy in today's very fast changing environment. Furthermore, plans alone are not enough: there is a need for continuous action and the ability to adapt the plan once it is in place if circumstances change or the plan does not work. It is precisely for these reasons that a good, modern business strategy is the key to success.
As we have already seen in the introduction, the history of strategy is in warfare. Business strategies, on the other hand, only became significantly more widespread from the 1960s onwards.
Back in 1970, the prestigious business magazine Fortune ran an article about Fred Borch, the CEO of General Electric, then the world's largest company, and the strategic plan he had drawn up seven (7) years earlier, locked in a drawer on the CEO's own desk. No one else, not even the top management team, was involved in the preparation of that plan.
On the other hand, back in 2006, Elon Musk published Tesla's strategy for that year in full transparency for all to see. Today, the company's strategy typically falls somewhere between a completely secretive and closed strategy and a completely open strategy. What is almost certain, however, is that GE's way of making and managing strategy in the 1960s and 1970s is unlikely to work as such in the 2020s and beyond, but certain elements of it are not dead either. Let's now look at the different historical stages of strategy in business.
In the 1960s and 1970s, the emphasis was on the timing of strategy as a plan. At the heart of strategic planning is a formal and analytical process in which key people examine the goals and choices of the organisation, and the means by which these goals are to be achieved. Unlike GE in the 1960s, organisations today tend to involve a wider range of organisational professionals in the strategy work. There is still a need for strategic planning, and it has not disappeared completely, it has just changed its form.
From the late 1970s to the late 1990s, the era of strategic management was highlighted. During this period, the focus shifted from strategy design to strategy implementation. In strategy work, this meant involving an ever wider range of people. This was done to ensure the organisation's capacity for change and learning.
From the golden age of strategic management, phrases such as strategy formulation and implementation have survived in business and organisations. For managers, these were, and perhaps still are, the best things ever, while our empirical experience - as managers and consultants - is that few people want to be the subject of implementation or execution.
The good thing about strategic management is of course that it recognises the people of the organisation as assets and opens up the opportunity for these key assets of the organisation to participate in the formulation and implementation of the strategy. If the strategy is not implemented, the desired objectives will not be achieved. This is why strategic management can still be found as an effective part of organisational management.
The most recent approach is the open strategy, where the strategy is opened up widely during the definition and implementation phase, both within the organisation and with stakeholders. The essence of an open strategy is continuous learning and adaptation. It emphasises openness, interaction and flexibility in the organisation's activities.
Almost every leader and organisation wants to have a strategy for success that creates a competitive advantage and helps them achieve their goals. Every success strategy is unique, but the following elements will help build a success strategy:
How to build a strategy for success?
Almost every leader and organisation wants to have a strategy for success that creates a competitive advantage and helps them achieve their goals. Every success strategy is unique, but the following elements will help build a success strategy:
Strategy is a complex subject area with a very long tradition, from antiquity to the present day. The most important thing when developing a strategy is to identify the situation of the organisation and what it wants to achieve. Then the appropriate approach to the strategy work itself and the strategy formulation process is chosen.
Sometimes this work is done by the companies themselves, but often they want an external partner to help them build a successful strategy.
The strategy answers questions about why the organisation exists, what it does (and doesn't do), and how it does things. The strategy work and process ensures that the organisation has a common direction.
Even the best strategy is no good in a desk drawer. The value of a strategy comes when it is translated into action in people's everyday lives.
The world is changing faster and faster, and the pace is not going to slow down. Similarly, the strategy must live not only in the present, but also in the foreseeable future.
