Guest Post : Strategic Agility – Strategy in the era of disruption

This blog post is by Nilesh Makan

While the world has been changing at an exponential pace over the last decade, it doesn’t compare with the seismic shifts that have transformed our lives over the past year or so. With the advent of Covid, we have moved into a discontinuous and digital world, impacting society as a whole.

 As parts of the world start to emerge from the pandemic, disproportionally so, we have an opportunity to learn from the past, and we have to make choices on how we move forward. Moving forward is strategy.

The word, strategy, is derived from the Greek word, stratēgia, and means “art of a troop leader. Strategy is effectively a plan of action designed to achieve a long-term or overall aim (Oxford dictionary). It provides a general direction to achieve a desired “future-state”.

In his paper, “The meaning of it all”, Richard Feynman says that the only certainty is that the future is uncertain. We have to act with certainty that the future is uncertain.

The question is then, if we talk about continued disruption, the rapid pace of change, and the certainty that the future is uncertain, how do we plan for this future, and what decisions must we take to get there.

These are not easy questions and there is no right or wrong answer. There are a multitude of views, and in the paragraphs that follow, I hope to share some ideas with you.

 I believe that there are four aspects to strategy. These are:

• Envision
• Strategic Signals
• Innovation by Design
• Iterate

The envisioning aspect sets the vision and provides the aspirational description of the company, product or project. It helps set direction and purpose (the Why). The envisioning phase is fundamental to aligning those working towards an envisioned future state.

Next, we need to understand the context in which we are operating. These are considered “Strategic signals“. These signals are defined as emergent changes to technology, customer needs, behaviours, the macro-environment, the political environment, and what is happening in the business’s sector. In effect, this aspect allows us to make sense. We make sense of the organisation, make sense as an institution and make sense as an individual. Being able to sense using strategic signals allows us the have a better shared mental model of the situation. We use this shared mental model to decide the inter-related choices that need to be made to respond to the environment. If the environment changes, so too must the strategy. Strategic signals can be two to three years out, or they can be ten years out. The further out they are, the better chance there is to take action now and move towards this future.

Once we better understand the environment and we have an idea of where we want to go, we need to “Think” a little. To do this, we must “Innovate by design“. We use principles of Design Thinking, Systems Thinking, Lateral Thinking, and other processes to understand the problem space, create options and make choices. Innovation by design should start with empathy. Empathy is where we try to understand the customer’s direct needs through questioning as well as their unarticulated needs through observation and synthesis. We then ideate around possible solutions and understand how it connects with within the systems we operate.

Finally, when there is awareness of where to place effort, and we have an idea of what products or solutions could be developed that speak to the customer needs, this is then built iteratively. Agility is at the heart of the Iterate aspect. Think big, start small, act fast, with customer focus, experimentation, getting constant feedback, and pivoting when necessary.  

Strategic agility requires a level of dynamic competencies. The firm’s ability to leverage, build and change internal and external competencies to address rapidly changing environments can create a competitive advantage. Business in the age of rapid disruption requires speed over elegance. While one can strive for improvements over time, a product or solution does not need to be faultless when launching it.

In short, leveraging trust, building autonomy and creating a culture of learning at a people, team and organisation level is essential for making things happen. As the management guru, Peter Drucker said, the best way to predict the future is to predict the future to build it.