Core Strategy: Know It When You See It

TL;DR

The serious study of organizational strategy is fairly recent, having started in the 1960s. Even in that short time, the current proliferation of approaches to the topic have made it difficult to navigate. To assist this navigation, core strategy is defined, and a model is presented to clearly set it in context.

The Evolution of Strategy

The Definition of Core Strategy

To navigate the fever swamp of strategy out there we need a definition that will help us create and analyze strategy. In other words, it’s actionable, as opposed to pithy. Strategy one-liners abound, variously defining strategy as:

  • Henry Mintzberg: “A pattern in a stream of decisions.”
  • Michael Porter: “Choosing what not to do.”
  • Arthur Lykke: “Ways to employ means to achieve ends.”
  • Lawrence Freedman: “The art of creating power.”
  • Cynthia Montgomery: “A system of value creation, a set of mutually reinforcing parts.”
  • Richard Rumelt: “A mix of policy and action designed to overcome a significant challenge.”
  • Robert Grant: “A unifying theme that gives coherence and direction to the actions and decisions of an individual or organization.”

To be fair, not one of these is completely wrong, and each is just a few words from an author who has published extensively on the topic and is a recognized expert in the field. Yet what we need is something more than pithy; short enough to be easy to grasp, but comprehensive enough to be immediately applicable.

Our candidate for this job:

Core strategy connects purpose to performance with a unique system to create measurable value for specific stakeholders. It accounts for both internal and external factors, ensures synergy between activities, is difficult to replicate externally, is sustainable into the future, and is constantly evaluated and improved. Core strategy gives coherence to your decisions.

I’ll unpack this definition in a future article. For now, let’s look at how we can visually model this definition.

The Core Strategy Model

The final model looks like this:

The arrows denote the direction of major emphasis, but in reality all factors can influence each other. Poor performance may require that core strategy be revisited. Core strategy might have a focus on altering the external environment.

The Basic Questions of Analysis

To paraphrase Alice in Wonderland, “If you don’t know where you’re going, any road will get you there.” When creating or analyzing strategy some basic questions, asked in a specific sequence, will get you a long way:

  1. Purpose: why does the organization exist?
  2. Performance: how does it know it’s making progress?
  3. External factors: what is the organization’s unique position relative to customers, suppliers, competitors, and collaborators?
  4. Internal factors: how does the organization leverage resources, capabilities, and culture to create and capture value?
  5. Core strategy: how does the organization put it all together to meet the definition of strategy we presented earlier?

These questions can propel the real work of the strategist, which is to facilitate a continuous conversation about how to make a unique, meaningful, and sustainable difference in the world.

Conclusion

This is a brief treatment of a complicated topic. I hope you find some value in the brevity, so when presented with something that may or may not be strategy you will know it when you see it. Use the definition and model above to determine if it’s a core strategy; if it’s not, then it depends on a core strategy somewhere. If it is core, start asking questions. And don’t stop.


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