e x e C u t i v e f o r u m
eXtreMe
StrateGIZING
Theresa M. Welbourne
Growing a business, or even stabilizing an organiza- tion, is risky business, and it’s getting worse as the rate of change in the world escalates. organizations are becoming more global and experiencing greater com- petition, making the game of business even more chal- lenging. However, in this evolving world, many of the tools used to do business have not kept pace. at the core of any organization’s founding, maturing, growth, or even reduction is a strategy; yet the strategy-making process that has been refined, written about by many experts, and taught in business schools remains funda- mentally unquestioned.
this article proposes that the institutional way of strat- egy making needs to adapt to today’s business envi- ronment, and that it needs a major overhaul, at least for organizations experiencing high levels of change. I argue that the strategy-making process is similar to soft- ware development in that both traditionally were very big picture, and both had high failure rates. traditional software development was and often continues to be done via a waterfall approach (falling from the top to the bottom of the organization). Big conversations kick off the process that leads to large-scale implementa- tion efforts, cascading processes, and ending in a final release to the public. Unfortunately, those releases are out of date upon delivery, missing the mark in meeting the needs of customers, because needs have changed since the waterfall process started.
In the world of programming, a new model has emerged that makes software development not only more agile
and timely but more accurate. reduced errors, higher customer satisfaction, and improved product are the outcomes of extreme programming models. extreme strategizing™ parallels the extreme programming model. the words reflect a process that is different from traditional strategy making. extreme strategizing is a continuous process, while strategy making is an event (a waterfall event); that is the core difference and the key advantage of extreme strategizing.
The Standard Strategy Process Here is a brief description of the typical process of strategy making for a large organization with multiple
business units:
• Internal strategy department or consulting firm starts the process.
• Senior executive team interviewed.
• research conducted.
• Senior executive team meets off-site for intense strategy discussions.
• New five-year strategy devised.
• Strategy documented and shared with core senior team.
• Strategy summary disseminated to the next level of management.
• Business unit strategies repeat the process, creating strategies that fit the overall requirements.
• Business unit strategies are given to functional area leaders.
• Functional area leaders devise their own strategies that fit.
• Managers in functional areas create their own matching strategies.
• Individual employees are given objectives and
goals that align with the department strategy, busi- ness strategy, and corporate strategy (in theory).
as anyone who has been through this process knows, it takes a long time. What many people know but are
Extreme strategizing is a continuous process, while strategy making is an event.
hesitant to admit is that the process is outdated. the
search for organizational agility, flexibility, and con- tinuous change hint that the process does not work,
but most efforts have tried to add tools to complement the traditional strategy-making process rather than seek to replace it altogether.
through an ongoing study of leaders that I have been doing since 2003 (called the Leadership Pulse; www. leadershippulse.com), the result of the problems of traditional strategy making are documented in de- tail. Leaders’ confidence in themselves, their abil- ity to execute on their firm’s vision, and their own leadership teams have all been declining steadily. Leader energy (a quick measure of engagement) has also suffered. and in the masses of comments ex-
plaining why these metrics are declining lies a plea
for a strategy-making process that is more agile and responsive to the needs of leaders and the people who work for them.
the qualitative and quantitative data from the Leader- ship Pulse studies (surveys that go out every two to three months to a global sample of leaders) tell a story of leaders who are confused. C-level executives are say- ing that they go in to work on Monday morning, and they are not sure what to do. Managers are unclear about priorities. respondents tell stories about having more and more projects dumped on their desks with no one taking old ones away.
these are people who have memorized their strategy;
they have objectives tied to the strategic business man- tra. However, the strategy is not helping them. the strategy misinforms because it is disconnected from
Strategy m