Henry Mintzberg is usually credited with starting the serious debate about the unintended aspects of strategy. As the diagram shows, he saw that the strategy which actually gets followed in an organisation comes from two directions. Part of the intended strategy, developed through an explicit strategy process, does carry forward into the realised strategy. But the realised strategy is also based on an emerging sense of what strategy should be, that arises from practical experience and day-to-day incidents.
There are a number of reasons for taking emergent strategy seriously:
- Research appears to show that the most successful entrepreneurial startups rely on a mixture of intended and emergent strategy. Interestingly, one of the formal strategy tools which is not associated with success is the traditional business plan.
- Even in larger companies with a formal strategy process, things with important strategic implications happen outside that process.
- Most planned strategy processes involve a fixed and usually lengthy cycle. Speed of response is tied to the cycle, and this often isn't good enough. Rather than searching for accuracy, and deliberating carefully, it may often be better to act quickly, learn through action, and potentially shape your environment in a positive way by doing so.
Given that the unintended strategy process will shape the future in many organisations, can we get better at it? Stephen Scott has reviewed some of the research, and has identified some guidelines for improving the quality of the process. These focus on what we should pay attention to, and the ways we talk to each other, explain and argue. They lead to a new strategic cycle, shown in the diagram below. It can be related to Deming's PDCA cycle of Six Sigma's DMAIC fairly easily, but this is misleading:
- People do not go round the cycle by following a fixed script. It describes what happens spontaneously, if people follow the emergent strategy guidelines in dealing with day-to-day events.
- There are no clear limits on the speed of the cycle. At any time, people can be at different points in the cycle for different subjects of concern. Strategy formation is therefore a constant activity, which can respond immediately to events whenever they happen.
We do not claim that all organisations should take emergent strategy equally seriously. For example, mining companies and government departments have strong requirements for strategic stability or operational consistency. Emergent strategy processes will not deliver this. However, many organisations would benefit from paying attention to both paths to strategy: the planned and the accidental.
A more extensive article on this has been published in Control, the magazine of the Institute of Operations Management. This is not yet available online. If you are interested in reading the full article, please email us.