Our environment is evolving faster and faster, and no one can predict the technological advances of the coming years. In this context, developing a strategic plan over a five-year horizon is becoming an increasingly difficult puzzle to solve. What if we changed our way of thinking about the future to adapt to our new reality?
“Developing and executing a strategic plan is no longer a game of chess as it was twenty years ago. It’s more like driving in a blizzard. You need to pay very close attention to what’s just ahead because long-term anticipation is impossible.”1 – Professor Julian ABC – London Business School
From a Linear Approach to an Iterative Loop
In the face of an uncertain future, the best approach to strategic planning is the “agility loop.” While the classic approach starts with a long-term goal and then evaluates the different steps to achieve it, the agility loop is an iterative 4-step process that allows us to test different approaches and adjust our direction based on the results.
Amazon stands as the undisputed master of iterative innovation. This approach is deeply ingrained in the company’s DNA, as evidenced by two of its core leadership principles: “Invent and Simplify” and “Bias for Action” (also known as the “two-way door”). The latter principle emphasizes the importance of quickly testing reversible decisions to validate or adjust them. Through this philosophy, Amazon has transformed its failures, whether minor or major, into valuable learning opportunities. The company’s true strength lies in its ability to adjust its initial strategy based on its learnings.
1. Understand
You must first develop a shared understanding of the current context. Technology or strategic intelligence, or even the study of Mega Trends, can be excellent sources of information to analyze your environment. It’s important to assemble a diverse team and consider multiple perspectives, as our first impression of the situation is often inadequate in a VUCA context.2
Triba Tip – In a complex business environment, it is useful to use the “blue team” vs “red team” approach, which assigns two groups the task of representing opposite sides of an idea. This technique helps improve the quality of decision-making by presenting the situation from multiple angles. For example, you could use this approach to assess whether the trend towards autonomous vehicles will impact your industry.
2. Choose
Once your team has explored all facets of your context, decisions must be made about the next steps. At this stage, open debates are strongly encouraged to avoid hidden conflicts and political games. Discussions should conclude with a few clear priorities that you can implement. The biggest challenge: stopping some projects or saying no to opportunities to avoid diluting your resources.
Research on successful decision-making in rapidly evolving environments has shown that the most successful companies don’t seek full consensus, nor do they go to the other extreme by letting one person make all the decisions. Instead, they apply a “qualified consensus” policy, where the leadership team seeks agreement up to a certain point, then invokes a set of predefined rules.3
3. Take Action
Clearly established priorities must be communicated to the team, and a tracking mechanism must be put in place. Whether through the performance management process or your team’s roadmap, everyone must clearly understand their role and commit to delivering results. The most effective commitments share five fundamental characteristics: they are public, actively negotiated, voluntary, explicit, and tied to the company’s priorities.4
4. Adjust Your Initial Strategy
The final step is often the one that’s overlooked: adjusting the initial strategy based on your learnings. Why is this step so difficult? Because it sometimes means stopping projects in which you’ve already made significant investments. This is known as the escalation of commitment syndrome. The best way to avoid it is to remain humble, seek out information that contradicts your initial assumptions, and avoid at all costs trying to find someone to blame.
The Evolving Strategy
Strategy is no longer an end in itself, but an iterative process in constant evolution. In this context, vision, mission, and purpose play a critical role, as they become our anchors in the storm. Are you ready to hit the road?
- Julian ABC, A new mindset for strategy, Agile organization strategies for business resilience, London Business School, 2022. ↩︎
- VUCA – volatile, incertain, complexe et ambigu. ↩︎
- Donald N. Sull, Closing the Gap Between Strategy and Execution, MIT Sloan Management Review, été 2007, Vol. 48, No 4. ↩︎
- Donald N. Sull, Closing the Gap Between Strategy and Execution, MIT Sloan Management Review, été 2007, Vol. 48, No 4. ↩︎
