What are “strategic issues” in the strategy development process
I seem to have struggled with the idea of strategic issues and I’m not sure why. I did have a go at identifying areas of strategic focus in a blog of October 2020 but this was more about identifying a coherent set of issues when looking at how systems currently operate rather than aspects of a strategy to concentrate on.
Looking at how a couple of writers on strategy have defined “strategic issues” only made it seem more murky. Bryson (1), for instance, has three points about how strategic issues should be described:
“An adequate strategic issue description (1) phrases the issue as a question the organization can do something about and has more than one answer, (2) discusses the confluence of factors (mission, mandates, and internal and external environmental aspects, or SWOC/Ts) that make the issue strategic, and (3) articulates the consequences of not addressing the issue.” (pp.192-3)
He also has a long list of factors that may help you decide if something is a strategic issue (pp.210-211) such as whether the issue is, or could be, on the agenda of the organisation’s policy board or how many other groups are affected by this issue and must be involved in resolution.
Johnson and Scholes (2) identify eight characteristics of strategic decisions (pp.5-8) which I have summarised as:
- Likely to be concerned with the scope of an organisation – how broad should its activities be.
- Matching the activities of an organisation with the environment in which it operates.
- Matching its activities to its resource capability.
- Strategic decisions have major resource implications for an organisation.
- Strategic decisions are likely to affect operational decisions, setting off waves of lower level decisions.
- The strategy will be affected by the values and expectations of those who have power in the organisation.
- Strategic decisions are likely to affect the long-term direction of an organisation.
- Strategic decisions are often complex in nature. This is because: (1) they usually involve a high degree of uncertainty; (2) they are likely to involve an integrated approach with no single function or area of expertise that can define or resolve the problem; (3) strategic decisions involve major change.
While quite possibly accurate, these formulations make it difficult to operationalise the concept of ‘strategic issues’.
More recently, I came to the conclusion that it was very simple. That was rather worrying. If it was so simple, why hadn’t I realised before? And if it’s not simple, why could I not realise that now? So, I’m wondering if perhaps the essential idea is simple but there are so many subtleties around it that it becomes quite sophisticated, a variegated miscellany. (And perhaps you can define ‘strategic issues’ in a number of different ways, and ‘the simple way’ is not the only one.) It’s worth noting that I am thinking of health and wellbeing strategies rather than strategies in general. My formulation may not work so well if your main aim is, say, to beat your competitors.
Before getting onto what strategic issues are, it’s worth a quick reminder of where they fit in the process of producing a strategy or strategic thinking more generally. Essentially, the strategic process starts with looking at where you’re trying to get to, the vision or a more detailed description of what the desired future might look like. You undertake analysis of how things work now and what is good and what not so good. You look at what the future might bring and what changes there will be in the environment that have to be negotiated. And you analyse what opportunities there are for change, to reach the objective. Out of that, start to emerge the strategic issues: the things you might want to focus on, the areas within which you start to develop more strategic plans, and out of which you will shape the strategic options from which a selection will be made to determine the strategy which is then implemented.
Something I’m not quite sure of: do you really move on from strategic issues to strategic choice (and never look back)? Or is the stage of identifying strategic issues more like the point where you come up for air, before diving back down into whirlpool of analysis? As with many aspects of strategy, this is probably a judgement to be made at the time.
The ‘simple idea’ is that strategic issues are those things where considerable beneficial change is possible or potential harms can be avoided (or which at least need to be addressed). Essentially, it is a cost benefit analysis at the broadest level (putting aside, for the moment, complications about what is measured and how, degrees of uncertainty and value judgements such as between overall levels of, and inequalities in, health and wellbeing). What we are looking at are strategic challenges and strategic opportunities. It’s where there is something you have to face, or where there’s a big chance of improvement.
So, where does the murkiness or confusion come from? There are a number of sources. Firstly, there is the issue of how you know what you could do to produce the benefit or mitigate against the harms, that you’re not already doing. Secondly, is the fact that you are looking from a long-term, big picture perspective. Thirdly, there is the question of which part of the messy reality to abstract from and decide is your area of focus – which part of the system, the level of generality and the place in the causal chain. And fourthly, each of the strategic issues will relate to others in complex ways, so you need to consider them in combinations, not just individually. Let’s run through each of those.
First, is how you know whether there is a way to produce the benefit or mitigate against the harms. There is a risk when trying to decide what is most important for the strategy of just looking at the significance of the outcome and not on how much you can do about it. There is almost always something you can do, but is it enough warrant focussing on it in a strategy? Dementia, for instance, is awful, and you can reduce or slow down the risks of getting it and help people live better lives with it, but at local level there’s not currently much you can do to stop it. There is unlikely to be a simple answer to whether you can do something significant in any given area. If there was an obvious way of producing greater improvement, you’d probably already be doing it. So, it may come from creativity, inspiration, innovation. Or it could be that by looking over the long term, you come up with things that wouldn’t be possible on shorter term timescales (such as investments which take many years to come to fruition). So, the first question is, is there something you can do to have a significant effect, either in producing a benefit or avoiding a harm?
Secondly, you need to be thinking long-term and big picture, (although this shouldn’t be a problem if you are in a strategic frame of mind). So behaviour change in the short term may tend to focus on things like weight management courses for individuals but in the longer term there could be opportunities for changes in the whole community by addressing food supply chains, developing a critical mass of communication, changing local attitudes and culture, mutual support and so on.
The third factor in creating the murkiness, and perhaps the hardest thing in identifying strategic issues, is how to define what part of the reality to focus on. Both the existing health and wellbeing system and the proposed strategy are highly complex. We can only make sense of them by abstracting to produce models: we can’t think of every individual person, so we work with groups such as the frail elderly, people with mental health problems and so on. We use concepts such as ‘the social determinants of health’, ‘early intervention’ or ‘technology’. However we do this abstraction, there are many potential perspectives and variation in the detail of how we map what is going on.
So, in identifying our ‘strategic issues’ there is a virtually infinite number of options as to how to define the part of the system we want to focus on. This could be what sort of intervention and change is envisaged, which part of the system, what stage of the causal process, what level of generality or a combination of those. For instance, obesity is a significant issue of health and well-being. But is the issue “obesity”, the group of people who are obese, the means of addressing obesity such as behaviour change, diet and physical activity, the costs to the health system of obesity, or the outcomes for the people whose lives are improved? Whichever is chosen may influence the thinking and approach, even though they are all part of the same overall phenomenon. For instance, say you have identified obesity is a problem and you have found a way of possibly changing behaviour to address it, if you then define the strategic issue as behaviour to address obesity, you might want to broaden it to behaviour change to address obesity and physical activity, or behaviour change to promote healthier lifestyles. You would do this if there is more benefit to be gained from one rather than another formulation.
There may be a number of reasons why you want focus on one aspect of the issue rather than another. For instance, taking the case of obesity again, it may be that you have a big idea about how to address the issue, such as behaviour change, which would suggest that that is the thing to focus on. However, it may be that there are a number of other more minor tactics to use on obesity and that it will be helpful to bring them altogether so making “obesity” the strategic issue rather than “behaviour change”. Another factor may be how the way it is formulated goes down with local people. People may be able to relate to the idea of “obesity” as something that is being tackled whereas “behaviour change” might be more abstract (or maybe even somewhat sinister).
A similar question of what aspect to focus on is which part of the causal chain is most important or relevant. Is it the social determinants of health, the personal behaviour of groups or individuals, treatment or other interventions or outcomes. Are we concerned by the health inequalities of differences in obesity or do we want to focus on how to get individuals to change their behaviour or the factors that influence population level weight management as a whole? The answer is probably to focus on that aspect which will be most effective in formulating and implementing the strategy.
A question arises, though, that if you identify an outcome, say reducing health inequalities, as a strategic issue, whether this should not be part of the initial aims or vision. You could say that this is an outcome identified as a strategic issue and the question is whether there are things you can do to make a significant difference to it. That suggests it is legitimate. However, there is a nagging sense that the vision or aim is in a ‘different bit’ of the strategic process and shouldn’t be muddled with this part. There is probably no easy answer to this and possibly it doesn’t matter. Something may appear in two places and there is, in any case, a constant iterative, back and forth process between these stages.
The fourth factor complicating the definition of ‘strategic issue’ is that each of those options will relate to others in sometimes complex ways. So, it is not just a matter of having a long list of strategic issues and going through them one by one to see which has the biggest cost benefit outcome. Different combinations of the strategic issues will produce different outcomes, often enhanced or subdued by systems dynamics such as vicious circles or virtuous cycles. For instance, a focus on behaviour change may be aided and supported by greater public involvement. Or “integration of health and social care” and “technology” as two issues may be mutually supportive. So, deciding which combination works best involves analysis of the underlying features, an understanding of the local situation and a certain amount of trial and error.
Having gone through all this, it should now be apparent why the question of what is a strategic issue is rather murky and it might make sense of the criteria used by the writers on strategy summarised above.
I am still not totally convinced that the simplicity I started with, that strategic issues are the ones with most potential benefit to cost, is right, even when distorted by the various complications I have considered above. But I haven’t yet spotted where the mistake is, so I’ll try applying this approach for a while to see whether it actually works out in practice.
(1) Bryson, John M., Strategic Planning for public and nonprofit organizations (Fourth Edition), Jossey-Bass, San Francisco, 2011
(2) Johnson, Gerry and Scholes, Kevan, Exploring Corporate Strategy, 2nd Edition, Prentice Hall, Hemel Hempstead, 1988