Contact Manager


+64 21 620 456

16 Kauri Street, Woburn, Hutt City, New Zealand


So if it is so important why are is strategy done so poorly?

Every year hundreds of thousands of dollars are spent by organisations on strategic conferences. Much of it is wasted!! Here's Why.

1. Too left-brained and lack creativity

In most organisations strategy development is too left-brained and separated from creativity by a wide gap. Our process has been designed to start with creativity and end with analysis.

Traditional StrategyCreativityOur process
Lots of analysis leads to visionVision without analysisVision then analysis
AnalyticalIntuitiveIntuitive then analytical
LogicalEmotionalLogical and emotional
LinearCircular with feedbackCircular with feedback
NumericalVisualVisual then numerical

Many strategy processes start by lots of analysis and large quantitative studies; the assumption is that you can move from a rational understanding of the organisation to a vision of what it could be like in the future. Our process starts with lots of creativity and challenge to the status quo, to achieve the passion and magic required for a compelling vision. Analysis is used to test the vision only after it has been agreed intuitively.

Many strategies start with the "what" (what we are) and the "how" (how we do business). Our process starts with the "why" (why we are important to the world). This is what captures the passion in customers and staff. Without a strong sense of "why" they think, "Who cares!"

Many strategy processes follow a linear path, from A to B to C. The results are predictable and dare I say BORING!!! Our process is more organic, circular and messy; it tends to circle around the organisation looking at it from many perspectives, often feeding back as we go, before determining the strategies.

Many strategies are highly numeric with models based on detailed numbers. Our process is more likely to start with simple drawings and metaphors before ending in broad numbers.

To make our processes more right brained we often:

  • Start at the end and work back to the present
  • Sit in a large circle without tables
  • Provide koosh balls or slinkies
  • Award the "most outrageous ideas award"
  • Encourage laughter.

2. Forecast methodology is wrong

The way most strategy processes forecast the future is inherently wrong and potentially dangerous. I'm an ex bean counter so I know how most budgets and planning work. The numbers in the long term plan are dominated by sales forecasts that are produced by product and customer type or region, usually on a projection of about five years. The forecasts are often heavily influenced by straight line projections. The organisation then allocates investment to business units consistent with them achieving the long term sales forecast. The business unit plans are reworked and iterated until they produce an acceptable long-term plan. Sometimes these forecasts have SWOT analysis and other market and trend analysis but the decisions are nearly always made on the basis of the forecast sales, investments, and costs.

In 1984, the Economist asked 16 people: four finance ministers, four chairman of multinational companies, four Oxford University economics students, and four London dustman to generate 10 year forecasts. They were the kind of forecast that underpin many long term strategic plans, including the average growth rate for the OECD countries over the next 10 years, the average inflation rate in these countries, the exchange rate between the pound and the U.S. dollar, the price of oil and the year when the Singapore's gross national product per person would overtake Australia's (at the time Australia was twice Singapore's).

In 1994 the Economist checked the 16 forecasts with what actually happened. On average the forecast were more than 60 percent too high or too low. The average forecast price for oil for example was $40 compared with an actual price of just $17. All the respondents said that Singapore's gross national product per person would never overtake Australia's, but that actually happened in 1993. The most accurate forecasters were the London dustmen and the chairman of multinational companies (equal first place). The finance ministers came in last. But the performance of every group was quite abysmal.

The unpalatable fact is that no one can predict the long-term economic and market environment with any real accuracy. Let's face it the annual strategic planning processes and most companies have changed hardly at all of the past decade or two. The unfortunate result of this is that strategy itself has gained a bad name. Strategies don't work so there must be something wrong with the process. There's nothing wrong with the process, is just the way managers undertaking strategy.

In many ways this discussion shows that predicting the future is almost impossible and a better approach is to create a organisation that is flexible, open and robust so it can adapt quickly to whatever changes the environment throws at it.

3. Strategy is emergent phenomenon

You need to think of strategy as an emergent phenomenon. By emergent I mean that strategies tend to emerge from the conditions and environment within which the strategy process is undertaken. For example a great Vision will emerge from the process if participants are encouraged to be creative, have fun, challenge the status quo and be able to change their minds.

Our strategy process treats the future as an emergent phenomenon. Most others work at the wrong end of the problem, focusing on the past rather than on the preconditions that could give rise to strategy innovation. Our process changes the way you look its strategy and starts searching for the deep rules of emergence, helping you understand the importance of System Thinking, including concepts like merchants, self organisation, Complex Adaptive Systems (CAS,) the edge of order, and organisational learning.

4. Too much emphasis on competition

Most strategy development processes over the last 20 years emphasise the importance of competition. Most of this is a direct result of the work undertaken by Michael Porter. As a result most of the analysis about the market place is based around what the competitors are doing rather than what the customer wants. Our process puts the emphasis back on the customer, not the competition. It starts to change the mindset from a mechanical model to a systems model. This moves thinking from a "zero sum strategy" to a "top line strategy" which is more consistent with a world view of plenty. It recognises the reality of many organisations that owe more to collaboration across their Sector than to competition within it.

5. Disregard emotions

Most strategy processes fail because they mistakenly believe that strategy is an intellectual activity when actually it's largely about emotions. As a result they put about 80% of their effort into logic, positions, costs and features and expect change to result. They fail to realise that people only change voluntarily if they feel safe and have some control over the direction they are going. Our process is designed to get under the surface to the unconscious level, it recognises emotions, feelings, trust and security; this is where we put 80% of our effort. As Wes Brown, a manager I respect greatly and MD of Datamail says:

"It's the last 14 inches from the head to the heart that matters most."

6. They emphasise paper rather than thinking

Most strategy processes fail to get it off paper and into heads. It's got to come off the paper and into every head important to delivering the implementation. And I mean EVERY head. Otherwise it remains theoretical nonsense that belongs to someone else. If it's done properly, you should be able to burn the final document confident that everyone understands what they have to do. This level of understanding is much quicker and easier than you probably believe. Our process allows and encourages people across the organisation becoming involved. This may sound time-consuming but there are tricks to doing it that save time and in the process generate enormous amounts of understanding, energy, goodwill and commitment. The most people I have had involved was 6500 people at the BNZ.

7. Too many strategies

I have seen plans presented where there are up to 20 strategies. There should only be 3 or 4 at the most. The fundamental concept of strategy is to be strongest at the decisive point. The biggest challenge in strategy is to select and focus. By definition decisive point(s) are few.

If managers try to do 20 things equally well they will almost certainly fail at all of them. However if the carefully think through the 2 or 3 things that will make the most difference and put their horsepower into these then they have a realistic chance of success.

8. Lack of management attention

Another key reason for failure is lack of management attention. In a recent distressing survey it was found that 85% of management teams spend less than one hour a month discussing their strategies. Now I ask you! Strategy by its very definition is a statement of the most important things happening in the organisation and yet managers are simply not talking about them!!! Our process focuses managers' attention constantly on achieving their strategies.

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