Leadership is creating and communicating a vision. A great vision, well articulated, acts like a magnetic field from the future that orients all the elements in the same direction and pulls them in that direction.

Managing is putting that vision into practice and making it a reality. Planning is the link between the two. Proper planning must remain flexible and adapt to new information. The ability to develop effective strategies that account for change needs to be baked into our planning process.

However beautiful the strategy, you should occasionally look at the results.

WINSTON CHURCHILL

We live in a Rapidly Changing Environment where we set goals, create a plan, implement the plan, and course correct when faced with obstacles and inertia.

The strategies we develop must be adaptive and responsive to change.

It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.

CHARLES DARWIN

Managers face a turbulent, confusing, and threatening environment. The only constant is change. Decisiveness can be a strategic advantage but decisions are made with imperfect and partial information. Decisions need to be made in the face governmental policy and regulatory changes, dynamic economic and market forces, demographic trends and lifestyle changes, and technological advances.

Most of these shifting circumstances are not anticipated in planning sessions nor addressed in the strategic plan.

Dealing with rapid, complex, and often discontinuous change in an opportunistic way requires decisive action based on incomplete information.

To think is easy. To act is hard. But the hardest thing in the world is to act in accordance with your thinking.”
― Johann Wolfgang von Goethe

We need to actively manage the momentum of the organization to keep it moving forward and in the right direction. These concerns form the basis of Strategic Management. It is a practice that resides at the intersection of leadership and management.

Strategic Management is an iterative and adaptive process including the following steps:

• Strategic Thinking

• Strategic Planning

• Business Planning

• Managing Momentum

• Execution of Plan

• Feedback and Measurement

• Iterate (Rinse and Repeat)

The best way to predict the future is to participate in its creation. You know where things are headed, because you are making it happen.

By engaging in activities that make an impact on progress we are in a better position to dictate the direction of change. It is not enough to simply be responsive to changes. You must participate in creating the future.

Leaders must see into the future, create new visions for success, and be prepared to make significant improvements to products, services and their delivery. Anticipate disruptions, convergences, and emerging trends and exploit them.

How we got here

Here is some back-story about how these concepts evolved.

Long-Range Planning to Strategic Planning

Long range planning in business became popular after World War II.

After things stabilized in the aftermath of war, Post-WWII economies began rapidly growing, as did the demand for many products and services. Long-range forecasts of demand enabled manufacturers and managers to develop detailed planning for marketing, distribution, production, human resources, and financial requirements for their growing organizations.

Long-range planning helped them anticipate how much capacity they would need in order to meet the projected demand. Planning became a tool in competing and succeeding.

They began to realize that it wasn’t a good idea to do your long range planning at the last minute. They began to become more strategic about planning early and often.

Increased Pace of Change

As the pace of innovation increased and customers became more discriminating, companies began to face more disruptive forces. Industries became more volatile.

Long-range planning operated under the assumption that the organization would continue to produce its present products and services. This only works in a static environment. For a static world matching production capacity to demand is the critical issue.

Long-range planning evolved into strategic planning as a way to adapt to a rapidly changing environment.

In the last decades of the twentieth century as strategic planning evolved and expanded into strategic management. This re-conception was an acknowledgment that organizations not only had to totally reinvent themselves on a regular basis, but also that continuously managing and evaluating the strategy are keys to success.

Strategy isn’t just an annual exercise that ends with putting the newly minted plan document on the shelf. It is a continuous process that relies on measurement and feedback.

There are many management techniques for measuring, comparing and analyzing results. What gets measured accurately gets managed properly. Some of the more recently refined approaches to business operations measurement are:

• Benchmarking

• Quality improvement

• The learning organization

• Lean Six Sigma

• KPIs

• OKRs

These represent various management processes for setting, communicating and monitoring goals against results in organizations. They are analytic and data driven.

Analytic approaches integrate strategic thinking and planning with managing strategic momentum. They aid in assessing the adoption of the strategy throughout the organization.

They hold managers accountable for implementing the original initiatives. They are also useful for organizational learning and adapting to be responsive in the face of a rapidly evolving and changing external environment so as to course correct in the face of disruptions, competition and threats that were not anticipated in the original plan.

As the great Prussian general Von Moltke said,

“No plan survives contact with the enemy”

Or as adapted by the great boxer Mike Tyson:

“Everybody has a plan until they get punched in the face. “

Strategic management is about identifying and nurturing the strategy that emerges after contact with external forces.

Strategic Managers

Strategic managers develop the ability to evaluate the changing environment, analyze data, question assumptions, and develop new ideas. They are also able to develop and document an action plan aligned with the strategic plan. This is another iteration of strategic planning moving down into the organization.

Strategic Management incorporates strategic thinking, planning and implementation in a coordinated and recursive process.

The Importance of Strategy

“To think is easy. To act is hard. But the hardest thing in the world is to act in accordance with your thinking.”
― Johann Wolfgang von Goethe

For a systematic study of Strategic Thinking, Planning and Implementation, check out my online course MBA ASAP Business Strategy.

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