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Strategy As A Catalyst for Change


What is strategy? In my blog post “What Does Strategy Really Mean?” from a few months ago, I focused on the need to shift from 5 year “strategic” plans that focus on short-term operations. Instead, we need to embrace approaches to strategy that look into the future and anticipate opportunities to create far more value.

That requires a shift in perspective at two levels – from inside the institution to the stakeholders outside and from addressing narrow, short-term needs to anticipating much bigger, long-term opportunities.

In this blog post, I want to focus on another dimension of strategy often overlooked by leaders of large institutions around the world. Rather than viewing strategy as a way to strengthen existing positions, strategy needs to be viewed as a powerful and necessary catalyst for transformation – both within and outside the organization.

Changing within

Many of you know that I advocate a very different approach to strategy, an approach that I call “Zoom Out/Zoom In” and that I have written about in more detail here. This approach has been used by some of the most successful information technology companies.

It focuses on two different time horizons in parallel – the zoom out horizon is 10-20 years and the zoom in horizon is 6-12 months. On the zoom out horizon, the questions are how will relevant markets and industries change over the next 10-20 years and what very large opportunities are likely to emerge over that time frame? The zoom in horizon focuses on identifying what initiatives can be pursued in the next 6-12 months to accelerate progress towards the longer-term opportunity, ensuring that these initiatives have a critical mass of resources in the next 6-12 months, and specifying metrics that can be used to assess progress.

This approach has many advantages over conventional five year plan approaches to strategy, but one important advantage is that it forces leadership out of their comfort zone. If they keep focused on five years, they can convince themselves that they will still be the same business they are today, with some minor changes. On the other hand, if they look out 10-20 years and believe they will be the same business as today, they don’t understand the implications of exponential change. It forces them to ask the most basic question of all: what business will we need to become?

The zoom in horizon then forces them to commit to near-term initiatives that will drive the changes required to become this new kind of business.

Changing outside

When looking out in the future, leaders also tend to believe that the industry and market structures that exist today will persist. In the Big Shift world of accelerating change, that misses a big opportunity.

The opportunity is to re-structure industries and markets in fundamental ways to create more value for customers and new sources of advantage for the providers. Don’t take existing structures for granted – explore how structures could be changed in fundamental ways.

This is an approach that I call “shaping strategies” and explore in more depth here. I’ve studied successful shaping strategies in the past, including those pursued by Bill Gates, Dee Hock and Malcolm McLean. We all know who Bill Gates is, but Dee Hock restructured the credit card industry when he led Visa, and Malcolm McLean restructured the global shipping industry when he developed standardized containers.

Changing inside and outside

I won’t go into detail here, but there’s another approach to strategy that I call “leveraged growth” and have written more about it here. This challenges the conventional approach to growth strategy which focuses on two options for growth – make versus buy. Instead, it emphasizes a third approach to growth that is becoming more and more feasible – growing by mobilizing more and more third parties to deliver value to your customers and capturing some of that value for yourself. Successful approaches to leveraged growth will transform broader markets and industries.

The challenge of change

In a rapidly changing world, we need to embrace strategies that will drive change to create more value for our stakeholders and ourselves. This is not just an opportunity, but an imperative.

The challenge is that we live in a world where people are increasingly driven by fear (as I’ve written about in my most recent book, The Journey Beyond Fear). People who are driven by fear tend to resist change. They come together into the “immune system” in large organizations to resist change. That’s why most of the efforts to drive fundamental change in large organizations tend to fail.

The success of the strategies for change that I discussed earlier depends on discovering ways to help participants move beyond fear and cultivate emotions that will help them to come together and achieve much greater impact through change.

I’ve discussed how these approaches to strategy can help overcome fear here and here.

Bottom line

Strategy needs to be a catalyst for fundamental change, both within our organizations and in our broader markets and industries. This is necessary, but very challenging. These strategies will only succeed if they address the emotions that are resisting change and find ways to excite people about the exponential potential that we can unleash through change.

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(if you've read the book, click here)

My new book, The Journey Beyond Fear, starts with the observation that fear is becoming the dominant emotion for people around the world. While understandable, fear is also very limiting.


The book explores a variety of approaches we can pursue to cultivate emotions of hope and excitement that will help us to move forward despite fear and achieve more of our potential. You can order the book at Amazon.

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