The five key elements that a strategy should contain
I want, in a future blog, to look at what Joint Health and Wellbeing Strategies (JHWS’s) could and should look like, and how they so often fail to achieve their potential. My feeling, for a long time [e.g. http://www.equwell.org.uk/what-a-joint-health-and-wellbeing-strategy-should-include/ from 2014], has been that many are not really strategies at all. To lay the groundwork for that critique, I want to start with some initial thoughts exploring what a strategy is.
A definition may help that by firstly asking whether all the components of the definition are present (should it even qualify as a strategy at all) and secondly, for the components that are present, how well are they employed to produce an effective, overall strategy.
Writers on strategy don’t seem to spend too long on definitions. That is partly, as a number of them acknowledge, because it’s quite a fluid concept. There is not a single, clear cut, precise definition of a strategy. But there are, I think, certain components that need to be there.
The idea of strategy comes to us from its military usage via commercial organisations and some definitions are specific, to some degree, to those environments. So, in the military sense, it may be about how troops are deployed to win the battle.
In business, it often focuses on what kind of approach should be taken to beat competitors. Michael Porter, for instance, has focussed specifically on competitive strategy.
Kenichi Ohmae goes as far as to say,
“What business strategy is all about – what distinguishes it from all other kinds of business planning – is, in a word, competitive advantage. Without competitors there would be no need for strategy, for the sole purpose of strategic planning is to enable the company to gain, as efficiently as possible, a sustainable edge over its competitors.”
(Italics in original) Ohmae, Kenichi, The Mind of the Strategist: business planning for competitive advantage, Penguin, Harmondsworth, Middlesex, 1982, p.36
He does recognise that there are other objectives, such as ‘increasing profitability’, but he wants to reserve the definition of strategy for competitive advantage because of its urgency – the existence of the enterprise may depend on it.
Many writers on strategy do include non-profit organisations within their remit, so it is not that their different circumstances are ignored, but discussions of strategy are often skewed towards the commercial.
Most definitions include, in some form, the idea that strategies are about ‘big picture’ views of how to achieve fundamental objectives. So, they are generally about key decisions with a large scale effect, covering the long term. As John Argenti puts it,
“A corporate plan, then, consists of a very few but momentous statements about the long-term future of the company as a whole.”
(Argenti, John, Practical Corporate Planning, Unwin Paperbacks, London, 1989 (1st published 1980), p.13).
What is ‘big’, ‘fundamental’ and ‘long term’ is to some extent relative. It is probably not much use to try and define precisely in advance what they should be. So, rather than asking whether something is of sufficient strategic size, shorn of context, it might be better to consider it in comparison to business models and operational plans, which are shorter term and within already agreed parameters.
NHS Improvement defined strategy as:
“a set of principles and choices designed to help systems achieve their long-term goals”
NHS Improvement, In it together: developing your local system strategy, NHS Improvement, London, 2016 April.
It is easy to think of strategies as high level plans: a series of steps you need to take to achieve your objectives. However, that is not necessarily the form that strategies do, or should, take. From the perspective of complexity theory, it is difficult or impossible to predict far into the future. So rather than a detailed plan, it may be better to have an approach. When facing a complex environment, that might well include having a general idea of the route you are trying to take but allowing for frequent modifications following feedback so as to take account of unforeseen consequences of actions.
Although he didn’t necessarily have complexity theory in mind, Mintzberg produced a framework which addressed the issue, as far back as 1987. [Mintzberg, Henry, The Strategy Concept I: Five Ps for Strategy, California Manager Review, Fall, 30.1, 1987]. As well as strategy as a plan (‘a consciously intended course of action’ or guideline(s) to deal with a situation) he said it could be a ploy (a manoeuvre intended to outwit a competitor or opponent), a pattern (a stream of behaviour that exhibits consistency, whether intended or not), a position (the organisation’s location in its environment, which produces most benefit) or a perspective (an ingrained way of perceiving the world).
The idea of a ‘pattern’ allows for emergent strategies, which develop through actual decision making but are not necessarily consciously planned. While that is important and needs to be taken into account when judging JHWS’s (there might be some strategy going on despite, rather than because of the JHWS), my focus at this stage is on the published documents themselves.
You could argue that each of Mintzberg’s types of strategy are all different ways to achieve the organisation’s (or entity’s) fundamental goals (or ‘mission’?). But I would argue that achievement of fundamental goals should be built in, rather than assumed. For instance, if there was a consistent pattern of behaviour but it was dysfunctional and not implicitly or explicitly designed to achieve the organisation’s goals, would you really want to call that a strategy? So, the idea of achieving a goal is at least implicit in Mintzberg’s typology, but perhaps should be explicit.
A couple of definitions that broadly include some of those concepts are these.
Kenneth Andrews, defines strategy as:
“Corporate strategy is the pattern of decisions in a company that determines and reveals its objectives, purposes, or goals, produces the principal policies and plans for achieving those goals, and defines the range of business the company is to pursue, the kind of economic and human organization it is or intends to be, and the nature of the economic and non-economic contribution it intends to make to its shareholders, employees, customers, and communities. (pp.18-19).”
(quoted by Fred Nickolls, https://nickols.us/strategy_definition.htm).
Bryson, looking specifically at public and non-profit organisations, more briefly, defines strategic planning as
“a deliberative, disciplined approach to producing fundamental decisions and actions that shape and guide what an organization (or other entity) is, what it does, and why.”
Bryson, John M., Strategic Planning for public and nonprofit organizations (Fourth Edition), Jossey-Bass, San Francisco, 2011, pp.7-8.
Bryson, like some other writers, includes, or in this case makes the whole definition, about an idea of what sort of entity the organisation wants to be; what it is here for. You might want to argue that this is a sort of strategy without an ultimate objective – ‘we want to be this kind of organisation and do this kind of thing, and we’re not focussed on achieving anything different from that in the long run’. You could say that this is their fundamental objective, but it’s just not something they’re aiming to achieve at some point in the future. Or, I’d prefer to argue, this is a concept overlapping with, but different from, strategy. It is deciding what the organisation wants to be, not where it wants to get to. Or perhaps it is a very particular subset of a strategy.
There are other elements that are often included in definitions, but this is often when writers are describing what strategies are like more generally and what things tend to be associated with them. Johnson and Scholes, for instance, identify eight characteristics of strategic decisions:
- They are likely to be concerned with the scope of an organisation’s activities, what should it do or not do.
- Strategy is to do with the matching of the activities of an organisation to the environment in which it operates.
- Strategy is to do with matching the organisation’s activities to its resource capability.
- Strategic decisions often have major resource implications.
- Strategic decisions are likely to affect operational decisions, to set off waves of lesser decisions.
- The strategy of an organisation will also be affected by the values and expectations of those who have power in it.
- Strategic decisions are likely to affect the long term direction of an organisation.
- Strategic decisions are often complex in nature.
(Johnson, Gerry and Scholes, Kevan, Exploring Corporate Strategy, 2nd Edition, Prentice Hall, Hemel Hempstead, 1988, pp.5-8).
One thing that I have always included in the rough and ready definition I use for my own purposes, is ‘taking account of what is likely to happen in the environment.’ But it could be argued that it doesn’t need to be in the definition because it’s already taken account of – you can’t know how you will achieve your fundamental objectives if you don’t take that into account. Equally there are a number of other sorts of thing you will have to do to produce your strategy: you will need to know your current resources, do a stakeholder analysis and various other things, but I would not necessarily want them included in a definition. However, assessing the environment, is a critical part of the process. Perhaps a way to deal with this is to include ‘analysis’ amongst the necessary components of strategy. Even if a large part of the ‘analysis’ is intuitive, it should still take account of the environment and other important factors.
So, if we are assessing a strategy such as a JHWS, what are the key components it should contain? What is the minimum that should be in a strategy? If the essence of a strategy is deciding where you are trying to get to and then, in the light of what might happen in the environment, deciding how you are going to get there, the strategy should contain a convincing account of the following.
It must contain:
- Approach to meet aims. There should be an approach to how to meet the fundamental aims. This may not be a blueprint covering the whole period (it is likely that it will not be possible to predict far ahead what will happen). So, it may be to do with positioning or the process to be used for following through on the strategy. But it should be clear how this sort of approach will help meet the aims and why it is better than other possible approaches.
That, in essence, is the strategy. To produce that will also require some sort of account of the following:
- Objective. It should be clear where you are trying to get to. It should be about meeting fundamental aims, rather than, say, instrumental ones).
- Long term and large scale. This is relative, but generally for any given entity, the larger the scale and time period, the more strategic.
- Analysis including environment. It must take into account a range of factors including the environment and what might change during the period (including PESTLE, political, economic, social, technological, legislative and environmental factors).
- What to do differently. It must consider alternative approaches. The list, or discussion, of alternatives may not appear in the final strategy, which could make this difficult to assess. However, if it can be shown that there is some better approach than that proposed, and there is no discussion of it, then the strategy is more susceptible to criticism. The proposed approach in the strategy may be to continue largely as now – you may already have the best strategic approach – but this should only be concluded after a proper analysis, which looks at a range of alternatives. It may be a matter of judgement as to how many alternatives should be considered and how different they need to be from the current approach. In the end, strategy making is as much an art as a science.
This is my preliminary list, based on both the theory and practical examples I have read so far, but it may be that as I critique more examples, I will want to modify it.