I n a world that is becoming more complex, turbulent and less stable, our traditional approach to strategy – – strategic planning – – becomes increasingly less reliable and effective. The alternative is agile strategy, a lean process of creating and capturing value through learning by doing.
In complex environments, strategic planning doesn’t work very well for a number of reasons. In its traditional form, the process typically begins by setting a vision toward which the assets of the organization will be aligned.
Yet, in a complex, shifting environment, the future is unknowable. More practically, in most situations, the strategic planning process has become long, costly, boring and cumbersome. It is unsuitable to detecting the “weak signals” of emerging opportunities. Rather than promoting powerful learning experiences, strategic planning compiles thick reports.
In contrast, agile strategy represents a rigorous process of exploration and experimentation to detect the weak signals of new opportunities. It launches experiments to probe for practical adaptations to what we are currently doing. It relies on transparency and iterative action plans to generate the trust needed to power the process.
Agile strategy answers four key questions.
Are we continuously exploring our opportunities by linking and leverage our assets?
Opportunities emerge when we connect our assets. These assets are embedded in our social networks, and these networks transcend organizational boundaries. The process of exploration is inherently creative, as we explore opportunities that are adjacent and connected to those we are already pursuing.
Are we converting our high priority opportunities into outcomes with measurable characteristics?
Instead of pursuing a unitary vision, agile strategy pursues multiple aligned outcomes. To provide coherence, an adaptive strategy groups these outcomes into a handful of strategic focus areas. Coherence emerges from the stories that describe why each focus area makes sense to pursue. Woven together, these stories form the narratives that guide the strategy and replace the idea of vision.
Agile strategy is a continuous process of figuring out what works. Success is measured by multiple characteristics. These success metrics are learning tools, not control mechanisms.
Do we have practical project and action plans that move us toward our outcomes over the short term?
In complex environments, strategy answers two questions: Where are we going? and How will we get there? Outcomes answer the first question. We find the pathway to an outcome through multiple projects with clear milestones. Milestones help us conserve our resources and evaluate our progress. With each project we are testing and refining the logic of our answers to the two strategic questions: Do we truly know where we are going? Will our pathway get us there?
Agile strategy relies on transparency and trust to provide accountability. Clear, shared action plans promote trust, communication and adaptation. When everyone knows their next step, progress takes place quickly through collective action.
Do we have a simple commitment for review and course correction?
Reviewing and adjusting an adaptive strategy takes place quickly in regular intervals. Through these reviews, participants evaluate their progress. They reflect on what they’ve learned. They make adjustments to both their outcomes and their projects. Finally, they make clear, shared commitments of what they will do next. In this way, they adapt their strategy both to what they have learned and to shifting circumstances.
We have embedded these questions into Strategic Doing, a protocol for agile strategy. The disciplines of Strategic Doing guide complex strategic conversations by following simple rules. We are just now moving this process out of the garage, an exciting moment.