Strategy = Innovation
What is strategy?
So, what is strategy? A master plan? A grand design? A plan of action? Programme? or Policy? The art of war or the art of winning? or something else? But one thing is very clear, everyone inside and outside of an organization freely uses the word strategy. What is not clear is whether they are all referring to the same thing.
Strategy is a set of actions that firms take to deliver superior performance or what we like to call a competitive advantage (CA). However, it is also important to note what strategy is not. As Michael Porter defined back in 1996 in his article “What is Strategy?” – strategy is not operational effectiveness (OE). It is not business process reengineering, benchmarking or any other such thing. It is the ability to create unique and valuable position that is not easily imitated by others and therefore strategy is what allows a firm to create and protect its competitive advantage.
Strategy is also innovation
Strategy is not about celebrating the past, it’s not about celebrating the present, it’s all about leadership in the future. Because your organization is a leader today does not mean you can assume you’ll be a leader tomorrow (e.g., a decade from today). And earning the leadership is what strategy is all about. If strategy is indeed about leadership in the future, one thing we know, every industry changes as time evolves and is prone to disruption. Therefore, if you want to be a leader in the future, you have to adapt to change. And the best way to adapt to change, is to innovate on constant basis!
With innovation, we do not simply imply product or service innovations (as they rarely result in sustained competitive advantage and breakthrough innovations that your competitors would have a challenge to imitate) but a more holistic innovation capability – new business designs & models and revenue models to mention few examples.
How strategy-making and related strategic decisions have an impact on organizational design of a firm? Learn more here.
Our thinking behind strategy-making
Our underlying thinking behind strategy-making combines both the design and learning schools of strategy. In other words, we do not simply believe that strategy-making is a deliberate process nor do believe it being simply “emergent”, a process and a pattern of actions that firms take.
We believe that sustained competitive advantage points and breakthrough innovations are the outcome of realized strategy-making – considering both major intended and emergent initiatives taken by the organization on behalf of owners, using its resources to enhance performance of the firm in its external environment.
More insights on our strategic work
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New approaches to leading strategic planning, combined with changing mindsets. More information here: A possibilities-based approach to strategic planning.
3-Box thinking as part of strategy-making
With 3-box thinking combined with data-driven methodologies we help our clients identify breakthrough innovation opportunities across business designs within their existing business or adjacent businesses to secure leadership position tomorrow!
As strategy is also equal to innovation, there are two fundamentally different types of innovations. Box one consists of linear innovation, innovation that is consistent with organization’s current business model or design, which improves the firm’s ability to manage its present day situation. Boxes two and three consist of nonlinear innovations which are not consistent with firm’s current business model – these innovations fundamentally transform the current business model!
Box three innovations are those that leverage opportunities to convert organization’s current non-consumers into consumers and thus enabling a firm to secure its leadership position a decade from now. What and where your firm invests its time today determines whether it will be a leader tomorrow!
Contact our Strategic Planning & Business Transformation practice area to learn more how we can assist your strategy-making process
Over the years we have worked with a number of businesses across various industries on their critical strategy needs across. Learn more about our methodologies and approach by clicking below image.
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