Strategy isn’t “messy”

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… and there are general insights. Just jumped on another claim that strategy is too complex,  subtle and case-specific to understand or learn about. (I hope the link works – it’s a LinkedIn discussion in The Strategy Bureau group under “Should strategy be taught like medicine?”)

The first claim was that “strategic” means, by definition, messy – I don’t see why. An issue, initiative, plan or whatever is strategic if it will likely make a significant difference to the medium- to long-term performance of the organisation. In my corporate career, we made a number of acquisitions that could not plausibly be described as “not strategic”, even though the rationale of each was really quite clear, as was its implementation. One such was a small company called Costa Coffee, now a major (i.e. strategically important) part of its parent, Whitbread PLC.

The second claim is that there cannot be any generalisable structures, relationships, mechanisms or insights because every situation is unique – this can’t be true either. For example (apologies for using this example before to illustrate other points), Starbucks closed 530 bad quality stores in 2008, having spent ~$200 or more to open them during the previous few years, and their profits dived by another few hundred million as they had to rebuild a reputation for value they had damaged in the same period. I guess stock-holders in the company would regard these errors as “strategic”. Interestingly, both these issues *exactly* match what MacDonalds did in the years before 2001, and the required response was exactly the same (including, as it happens, bringing back a former CEO – but that’s probably pushing the general lesson too far). We know this because the MacD CEO stated it explicitly in their 2001 Annual Report – so is it too much to ask strategic leaders to take note of mistakes (or successes) others have demonstrated and avoid (or replicate) them as appropriate? What is “unique” about Starbucks that makes them immune to the damage caused by over-expansion? This classic strategic error is extremely common in retailing, as are a host of other successful and unsuccessful strategic moves in many other industries.

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