How to Use the 4Ps to Capture Future Scenarios: Thinking Strategically

Greg Githens 4 Comments

How to Capture The Future

Strategic thinking involves thinking imaginatively about the future. It enables the strategist(s) to articulate answers to two questions,”What are the things that might happen in the future? And, what is the realistic future state that I desire?

Strategic Foresight

Richard Slaughter defines strategic foresight:

Strategic foresight is the ability to create and maintain a high-quality, coherent and functional forward view and to use the insights arising in organizationally useful ways. It represents a fusion of futures methods with those of strategic management.

 Strategic foresight is a sub-discipline of strategic thinking, and it can help you develop answers to those two questions. Strategic foresight not crystal ball gazing (prediction), it is about discerning factors that create the future and describing alternate futures. Why? The purpose is practical: generate insights about the future so that the strategist can make better present-day choices.

The 4Ps

There are four broad categories of futures, the 4Ps: they are the possible, plausible, probable, and preferred futures. (There is a 5th P, potential futures, where the strategist applies unbounded imagination and extends the vision into realms that are best termed fantasy.) Ideally, we approach the 4Ps in the order suggested in the nearby graphic.

The strategist should begin with the possible future with the goal of developing a broad understanding of the situation.  Now is the time to consider “wild card” scenarios or “black swan” events. Divergent thinking (as opposed to convergent thinking) and an expeditionary mindset are appropriate styles of thinking.

  • Questions to Ask: What is the most radically-different unbounded future that I can imagine? What is the best and the worst case?  What is strange, weird, and crazy? Might it happen?
  • Answer to Expect:  Yes, the scenario might happen.

Next, she narrows into plausible future states (those which are “seemingly or apparently valid, likely, or acceptable; credible”). Convergent thinking is used.  An important idea for this is to consider the “narrative arc” of the organization or situation.

  • Questions to Ask: Which future states are feasible, given what we know at present? What would have to happen for this state to arise? How does this future state mesh with the founding mission of the organization and the values of the founders and other stakeholders? Could it happen?
  • Answer to Expect:  Yes, the scenario is plausible.

The third of the 4Ps is the probable future.  The strategic thinker is getting increasingly more analytical and applying systems thinking (being systematic in thinking is one of the four qualities of strategic thinking).  Here, she considers causal factors, delays, and weighting for the contribution of the causal factors to the emerging outcome.

  • Questions to Ask: Which events (that would cause this future) are is most likely?  What other events need to happen, too?  Where can we get data to support our assumptions? How likely is this future to happen?
  • Answer to Expect:  We have a systematic understanding of what would cause each scenario, and an estimate of the probabilities.

The fourth P is the preferred future state.  We can influence our future.  We can find the performance gaps and create strategic initiatives to close the gap.

  • Questions to Ask: What future do I prefer? What choices should I make about scope, objectives, and advantage? (See this article for more on those three elements.) What do I want to happen?
  • Answer to Expect:  This is the scenario that most fits my ambitions and expectations.

Cautions About the Preferred Future

The flow of attention described – possible to plausible to probable to preferred futures – is an ideal. It’s difficult to practice because it starts with imaginative and ambiguous scenarios.

It’s easier for people to start with stating a preferred future. However, that is problematic because the alternatives are feasible and occasionally do occur. You can’t be proactive if haven’t considered the future that you are pro-acting to.  As difficult as it may seem, the strategic thinker will consider alternative futures.

In those organizations that have established and mature process, people often hold unexamined assumptions is that the future will resemble the present. This is a status quo bias, and we see the results continually in firms that have been unable to respond to technology or social trends: film-based photography, newspapers, and bricks-and-mortar retailers of videocassettes to name just a few.

Aspirational visioning is common. Consider a large publically-traded company in agribusiness, a very mature business.  The CEO had seen a presentation on Red Ocean Blue Ocean strategy (The blue ocean is a new wide-open market where you don’t have to fight it out with competitors).  He challenged the Presidents of all of his business units to grow substantially in the next five years. People made some attempts to dream big ideas, but it the goal was soon forgotten as day-to-day operations reasserted their priority. Masked by the “great recession,” the company missed signals that its markets were fundamentally changing. The company ultimately shrank in size!

When managers move quickly to the preferred future, they often make the mistake of confusing the goal for a strategy. Note what UCLA’s Richard Rumelt says about this in his book, Good Strategy/Bad Strategy. He writes,

“Executives who complain about execution problems have usually confused strategy with goal setting. When the “strategy process is basically a game of setting performance goals – so much market share and so much profit, so many students graduating high schools, so many visitors to the museum – then there remains a yawning gap between these ambitions and action.  Strategy is about how an organization will move forward. Doing strategy is figuring out how to advance the organization’s interests. Of course, a leader can set goals and delegate to others the job of figuring out what to do. But that is not strategy. If that is how the organization runs, let’s skip the spin and be honest – call it goal setting.”

By examining the futures in the more rigorous way espoused here – possible, plausible, probable, and then preferred – the strategist increases the likelihood that they are considering real organizational issues that deserve attention and resources. Too, the act of generating alternatives increases the prospects of finding the insights that are necessary for a brilliant strategy.  As practical advice, consider increasing the amount of effort in strategic foresight, and then distributing your time in this way:

  • Possible Futures – 15%
  • Plausible and Probable Futures – 60%
  • Preferred Futures – 25%

You should iterate through versions of the plausible and probable futures.  You might want to occasionally relook the possible futures to see if they might be better categorized as plausible so as to avoid a blind spot.  Too, revisiting the possible futures might cause you to see a strategic driver in a new way.Strategic Thinking Definition

Remember that the definition of strategic thinking is not simply about imaging a future, it is doing with the intent of being better off in the future. Although this could be dismissed as “just a creative exercise,” it has the potential of sparking important creative insights necessary for building a good strategy.

How have you applied the 4Ps to your development of strategy?

How to Develop Strategic Insights

Greg Githens 3 Comments

christopher columbus strategic thinker

Strategic thinking involves thinking about the future in a purposeful kind of way; that is, to generate useful insights that guide present-day choices. Presently, data analytics and statistical forecasting is popular, but I want to focus on generating insights, which usually come to the individual subconsciously.

 

Christopher Columbus: Strategic Thinker

Let’s imagine ourselves shadowing Christopher Columbus prior to 1492. As a naturally curious person, he gained knowledge for winds and currents and seamanship from his experiences sailing the Mediterranean, North Atlantic, and West Africa.  He read many books on astronomy, geography, and history and made hundreds of marginal notations in them. He  collected and interpreted data in the light of his personal ambitions.

History tell us little about Columbus’s reasoning. Regardless of the historical record, at some point in time Columbus developed the insight that he could use the Easterlies (trade winds off the coast of Africa that move from East to West) to sail westward, and then return to Europe via the Westerlies.

Christopher Columbus was a strategic thinker who took an abstract and unproven idea and proved it was true.

Andy Grove’s Strategic Decision

Consider Intel chairman Andy Grove’s story of how he came up with an important business strategy.  Attending a management seminar, Grove heard the story of how fledgling “mini-mills” in the steel industry began in the 1970s to offer a low-end product—inexpensive concrete-reinforcing bars known as rebar that subsequently gave them the entry to dominate the industry once dominated by integrated steel makers like U.S. Steel.  Grove saw that Intel was sitting in a similar situation: its dominance of its industry could be disrupted by allowing niche players in its industry to take the low-end part of the market.

“If we lose the low end today,” Grove realized, “we could lose the high end tomorrow.”  At Groves’ insistence, Intel redoubled its efforts to develop and market the low-end “Celeron processor” for the emerging personal computer market.

Openness to Fringe Data and Dissent

Grove had an abundance of data from Intel about its production, its production plans, market demand, and profitability of Intel’s various product lines. He and his team easily could have used that data to frame its strategic plans.  Indeed, that is very common for strategy setting by most firms.

Grove used analogy in his reasoning process: How is “A” like “B?” or “How are chips like steel?” One answer is that they are similar in that both have low-margin commodity-like grades and high-value engineered grades.

The insight is particularly remarkable in that Grove considered data from outside his industry.

Indeed, I meet many managers who say something like “Our industry is unique” when in reality there are more commonalities than differences. The statement, “we’re unique” establishes an excuse for close-mindedness and learning. They fall into a trap of where their belief system causes them to filter out contradictory information.

The openness to new ideas – from anywhere – reveals new explanations and possibilities.  Strategic thinking incorporates much of the characteristics of creative thinking; for example, both make considerable use analogies.

Strategic thinking is different because of its emphasis on the future and on success, particularly in the crafting of strategies that give the strategist an advantage over others.

Insights – Start With These Four Questions 

In my experience, insights come from posing and answering questions. 

When thinking about the future, it is useful to consider the answers to these four questions:

  • What data and evidence about the past, present, and future do I choose to consider (and to ignore)?
  • What seems to be happening?
  • What is really happening?
  • What might happen?

Strategists employ strategic thinking to generate about the future, but taking the context of the present and the past into consideration. How can you use strategic foresight to enhance your strategic thinking capability?

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Tip: Strategic Thinkers Look for “What’s Interesting”

Greg Githens 2 Comments

I realized (while writing the prior article, Could Strategy Be as Simple as This?) that the factor of “advantage” was the most interesting of the three strategy components (objective and scope being the other two). Advantage refers to position or potential versus another.

What makes advantage interesting as a factor of strategy? First, my experience is that many strategists seldom think about advantage. Too often, strategists assume that their job is done when they establish goals and objectives. However, a competitive reaction will always occur. Second, the idea of competitive rivalry creates the tension that makes for a good story; and stories are enormously powerful leadership tools. Third, creative and innovative ideas gain much of their power and impact simply because they address unrecognized issues. They are pleasant surprises.

This leads to a powerful question that provokes strategic thinking: Who do you want as a future competitor? As you answer the question, you imagine the evolution of your strengths and weaknesses versus a new set of competitors.

As an example of thinking about future competitors, I was part of a business development team that was leading our venture into an entirely new market, where we would no longer be competing against “mom and pop” enterprises, but would be facing well-funded and professionally-managed corporations. We constantly reminded ourselves that we would need processes and intellectual assets to be able to prevail against them – even though the competitive face-off was at least a year away.

An Aside: Why is being interesting so interesting?

The key word in this stream of thought is interesting. Strategic thinkers know that people will want to engage with someone whose ideas are eye-opening in some way. The further exploration of those ideas provides camaraderie, mental stimulation, and open up the opportunity for economic benefit.

Here is an interesting point that I learned from the management guru, Tom Peters: If you want to innovate, look to your most interesting customers. Interesting customers are typically NOT your biggest customers. Your interesting customers are trying to solve novel problems. As Eric Von Hipple – the guru of lead user research – suggests, develop and provide tool kits and search out those users who invent solutions to problems.

How to make scope interesting

The scope of strategy to determine what is “in” and “out” of consideration. I think the interesting question is where the organization chooses not to venture. Note what Chris Peters of Microsoft (Microsoft Secrets, Page 210) has to say about excluding items from the scope:

“There can be good and bad vision statements. A good statement tells you what’s not in the product; a bad vision statement implies everything is in the product. In order to give you guidance on what’s in and out, you have to kind of explain what the thing isn’t. And too often marketing will decide that it’s best if everything’s in… The hard part is figuring out what not to do. We cut two-thirds of the features we want to do in every release off the list. If we could actually write down everything we wanted to do, it would be a fifteen-hundred-page document. So the vision statement helps you in the chopping mechanism, not in the creation mechanism.”

How to create an interesting objective

An interesting objective is one that is counterintuitive.  It might possibly be of the type where one “loses the battle in order to win the war.”

Here is an example of a counterintuitive action.  In the 1940s, a group of 17 forest fire fighters were dropped into Mann Gulch in Idaho to battle a blaze. The blaze unexpectedly reversed course on the group and started running up the mountain towards them.  The leader of the group -Wagner Dodge – recognized that they could not outrun the blaze, so he built a small escape fire  to consume nearby fuel (fuel, heat, and oxygen being three necessary ingredients in fire), resulting in a protective zone.  This objective was not standard fire-fighting procedure. He survived, but those who tried to outrun the fire perished. (Gary Klien covers this incident in his book Seeing What Others Don’t. He calls this process of insight development creative desperation.)

Strategic Thinkers are Curious

The question about “interestingness” is one that a curious person would ask. Because they are curious, strategic thinkers add value to the strategic planning process. Instead of approaching strategy with a checklist mentality of completing each prescribed step and moving on to the next one, they stay alert for opportunities.

Do you agree that curiosity is an important characteristic of the strategic thinker?

kitty is a strategic thinker
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Could Strategy Be As Simple As This?

Greg Githens 3 Comments

Strategic thinking is purposeful, and one purpose is to spark strategic insights. These insights make it easier to make decisions.

This article’s proposition is that strategy involves three choices by the strategist: choice of scope, choice of objective,  and choice of advantage. These choices do not constitute strategy, but answering them puts you on the course to actually having a strategy and not just a list of goals and initiatives.

What is the scope of our venture?

Scope is a term used to mean what is “in” and “out” of consideration. In other words, what is the definition of the venture? It could refer to the firm, the program, the team, or the individual.

The following sub-questions can help the strategist in partitioning and defining the scope of strategy:

  • Are we thinking big, or small?
  • Where is our geographic domain? Local, regional, expatriate, or global?
  • When we think about the venture as a “solution provider,” to what extent do we want to produce the solution, sell the solution, and service the solution? Stated differently, what part of the value chain do we want to operate in? Are there unexploited or under-exploited opportunities to capture value?
  • Is there anything that the venture explicitly won’t do?

What objective(s) do we choose to pursue?

The strategist first considers the circumstances – diagnosis – and selects an objective that best fits her diagnosis of the situation. Next, they choose an objective that is most sensible for the stakeholders.

The following sub-questions can help the strategist in identifying strategic objectives:

  • How do we think about success?
  • If we commit to a stretch goal, can we acquire the resources that will get us to the goal?

Critical thinking is a component of strategic thinking. Activate the logic to see if the objective is sensible.

For example, I once worked for a CEO said, “We grew revenues 35% last year, so our goal for next year is 35%.” That probably qualifies as a BHAG: a Big Hairy Audacious Goal.  BHAGs can be be useful if they are based on a logic and commitment to apply resources. They can be discouraging if there is no underlying design.

Who or what are we trying to gain advantage over?

Most people have heard this joke.

Strategic thinkers outrun the bearTwo campers come upon an angry bear. The first says, “I’m glad I wore my running shoes.” The second says, “you can’t outrun the bear.” The first says, “I don’t have to outrun the bear, I just have to outrun you.”

Sometimes it is only a small advantage that allows our success. But nevertheless, it is an advantage. Strategy is about leveraging a small advantage – and combining it with other advantages – so as to gain a more significant advantage.

Here are three sub-questions that help to identify the areas where the strategist can find advantage:

  • Who are the competitors and where is their focus and power?
  • What alternatives are available (including the “do nothing” alternative)?
  • Is the identified advantage actually important to the customer (or other important stakeholders)?

As it pursues its objectives, the venture needs to provide something of value to its stakeholders. There are always competitive alternatives and substitutes available to these stakeholders; for customers, its other product/service offerings; for                            not-for-profits, it is a competition for attention for funding or policy.

Conclusion

These three decisions do not comprise a complete definition of strategy, but they do provide a useful framing perspective. Insights are often simple ideas that tell us about the essence of something.

As you consider your answers, consider how you would blend them together into a problem-solving or opportunity-capturing design.

Do you agree that this is a simple way to think about strategy? How can a strategist apply the questions?

How to Improve Strategic Planning with Strategic Thinking (and vice versa)

Greg Githens 3 Comments

Strategic thinking v planningStrategic thinking is an individual activity that is a style of thinking. It is not an organizational process or activity for the basic reason that people do not share the same brain.

Many writers use the phrase strategic planning to describe the organizational process of setting strategy. One style of strategic planning is adaptive, starting with scanning the external environment. For example, a firm may notice a trend in its customers or in government policy that opens new market opportunities.  The strategic planning process then moves into developing responses, and those responses often constitute the “strategy.”

Another style of strategic planning is a straight-forward planning exercise to achieve a pre-determined goal. Here the emphasis is more on the word plan, with the adjective “strategic” suggesting that it is an “important plan.”

Strategic thinking and strategic planning are similar in that:

  • Both deal with strategic intent and strategy
  • Both involve collecting and logically-processing information

Strategic planning receives much criticism. In many organizations, strategic planning has become highly structured; a groan-inducing set of templates that yield an artifact called the “strategic plan.” Often the reason for that is that strategy becomes tied to budgeting, and the words that comprise the “strategy”  becomes the documented rationale for the proposed budget. In too many organizations, strategic planning exists solely as an annually-repeating bureaucratic process of creating artifacts, discussing them, and filing things away.

This bureaucratic approach is further magnified by use of pre-structured templates. A common response to the templates is that practitioners skip the analysis by writing down the first thing that comes to their mind. Analysis is mentally exhausting and they are busy, and no one really notices what they write.

Yet, strategic planning is also supported and lauded. It certainly receives important resources.

Strategic planning can be done well or it can be done poorly.  Strategic thinking can be done well or it can be done poorly.  We don’t need to replace strategic planning with strategic thinking, we need to focus on the unique value adds of each.

I have a modest proposal: mix the advantages of strategic thinking
with the advantages of strategic planning to maximize the contributions of both.

~~~

How Strategic Thinking Improves Strategic Planning

Strategic thinking is the source of insights.  Insights are important design elements in strategy formulation. Consider how these insights are generated and applied:

  • Strategic thinkers imagine the “what ifs” and the future state. They contrast  the desired future with the current state. This information can is often captured (recorded) in strategic artifacts as situational analysis and vision statements.
  • Strategic thinkers often generate imaginative and creative problem solutions. The solutions would probably be recorded in the documents as strategies, or guiding policies.
  • Strategic thinking is opportunistic, and SWOT-type analysis includes capturing and recording opportunities.

How Strategic Planning Improves Strategic Thinking

Experience with strategic planning can foster an individual’s competence in strategic thinking. Participation in the process of strategic planning processes forces individuals out of their comfort zone into their learning zone. Here are a few of the benefits:

  • They learn to recognize and tolerate ambiguity and abstraction
  • They learn that while processes reduce ambiguity, processes the status quo; this anchoring on the status quo can cause the organization to be slow to respond to threats or opportunities
  • They learn that there is seldom one right practice or vision
  • The learn to ask better questions
  • They learn some of the specialized jargon, and can better communicate with others about concepts associated with strategy

I saw the value when I worked with volunteer leaders of a Project Management Institute (PMI) component group. PMI Headquarters required strategic plans and measures. These volunteer leaders were primarily trained in science or engineering and were accustomed to being provided a “scope” to which the would develop execution plans. They thought of planning as an exercise create documents that answered explicit questions.

Strategy is ambiguous and working with ambiguity put the people out of their comfort zone. They struggled (and complained) but they learned.

In the post-activity lessons learned, the participants felt that they had matured some as strategic thinkers. Here are a few representative comments:

  • “I learned to look for data, and not make assumptions when I had little data to support my hunch”
  • “I started to ask some of the same questions about my own organization’s strategic position”
  • “I became much more focused on our customers, and how we create value for them; If we can’t develop a good value proposition, we won’t succeed”
  • “I feel much more comfortable with the ambiguity that characterizes strategic situations”

Manage the Interface Between Strategic Thinking and Strategic Planning

Because organizations are social entities that must act collectively, individuals often (and should) share their information and insights with others. Here are some suggestions:

  • Encourage individuals to reflect and think strategically, with the purpose of developing relevant and meaningful insights.  Allocate time and encourage people to work individually, at least for a while. Strategic thinking is a somewhat solitary and reflective activity.
  • Discourage the sole reliance on formal written documents and templates.
  • Encourage people to have conversations where they share insights with each other.
  • Encourage people at all levels of the organization to participate in contributing to strategy.

Do you agree that strategic thinking and strategic planning are complementary?

Three Strategic Thinking Characteristics

Greg Githens 2 Comments

Strategic Thinking Image over Kalidescope over streaming

What are the characteristics people who think strategically? Are there elements of their personality that facilitates their use of strategic thinking?

Curiosity, ambition, and pragmatism (CAP) are three important traits of strategic thinkers. These traits do not define strategic thinking nor strategic thinkers, but they provide a form of energy that motivates them to acquire and practice effective strategic thinking.

Curiosity

Strategic thinkers are intellectually curious.  They ask questions in purposeful kinds of ways.  Here are a few quotes that illustrate curiosity as a trait of strategic thinkers.

  • “The important thing is not to stop questioning. Curiosity has its own reason for existing.” Albert Einstein
  • “We keep moving forward, opening new doors, and doing new things, because we’re curious and curiosity keeps leading us down new paths.” Walt Disney
  • “I have never read for entertainment, but rather for understanding and to satisfy my eager curiosity.” Bryant H. McGill

Ambition

Strategic thinking is hard work for most in that thinking strategically takes people out of their comfort zone. The ambition of the individual is a driving force in overcoming the status quo. Here are just a few quotes by accomplished people on the importance of ambition:

  • “Intelligence without ambition is a bird without wings.” Salvador Dali
  • “Ambition is the path to success. Persistence is the vehicle you arrive in.” Bill Bradley
  •  “Every man is said to have his peculiar ambition. Whether it be true or not, I can say for one that I have no other so great as that of being truly esteemed of my fellow men, by rendering myself worthy of their esteem.” Abraham Lincoln
  •  “If the leader is filled with high ambition and if he pursues his aims with audacity and strength of will, he will reach them in spite of all obstacles.” Karl Von Clausewitz

Pragmatism

Pragmatism is more than simply being “practical.” Pragmatism is the balance of action with reflection, as I explained in this article, action without thought is impulsiveness and thought without action is procrastination. Pragmatism is concerned with innovation and it is concerned with what works.

Pragmatism says to the prior two factors of ambition and curiosity, “Don’t go overboard. Keep perspective.”

For example, unmitigated ambition can be dangerous. Many tyrants and despots have the ambition for power, but not the ethical framework to apply their power for a higher-order principle.

Curiosity, too, can be taken to an unproductive extreme. Some people are nothing more than dreamers, accomplishing little. We want to strive for a balancing of thought and action. Consider this quote from the musician Bono.

  •  “You see, idealism detached from action is just a dream. But idealism allied with pragmatism, with rolling up your sleeves and making the world bend a bit, is very exciting. It’s very real. It’s very strong.” Bono

Pragmatism tempers the tendency to get lost in conceptualizing and moralizing. It adds purposefulness to dreaming.

Do you agree that ambition, curiosity, and pragmatism are three traits of strategic thinkers?

Strategic Thinking Defined

Greg Githens 9 Comments

Strategic Thinking Image over KalidescopeStrategic thinking is defined as the individual’s capacity for thinking conceptually, imaginatively, systematically, and opportunistically with regard to the attainment of success in the future.

Let’s unpack this definition. There are six elements of strategic thinking:

Success Oriented. The word “success” needs to be considered in the context of the usual meaning of the word strategy; that is, some field of competition where the strategy exploits advantage and leads to a desirable outcome for the strategist. For example, success in a game involves winning within the boundaries of a set of game rules.  Success in a military encounter might define the victor as the entity who holds the field at the conclusion of the battle. Success in business might be defined as penetrating a new market. Success in a political campaign might be defined as winning a referendum or elected office.  Consider this: if there is no competition, there is no need for strategy.

Richard Rumult (Good Strategy/Bad Strategy, page 127) tells us that strategy involves premeditation, anticipation of the reactions of others, and the design of coordinated action.

Success is the consequence of a strategy.  Thus, strategic thinking involves considering questions such as, What are the causes of success? What is the best way to design a strategy to fit the situation?

Aside from the idea of competition, it is fair to assert that the definition of success is influenced by context, particularly of the stakeholder. Success could be determined as betterment over the existing situation.

As a practical matter, the strategic thinker needs to address fundamental question such as, Who (and what) defines success? What metrics are in use? Notice that the opinions of individual stakeholders are relevant, so  the strategist needs to consider questions such as these:  Whose opinion is most important?

Future Oriented. Strategic thinking involves looking towards the future with an appreciation that present-moment decisions will have impact on the future. The future may be very different from the status quo. Strategic thinking must consider the outputs of what is commonly called “futurology” or “strategic foresight.” A strategic thinker takes into account the past and present, as part of the inputs for considering the future.

Cognitive. Strategic thinking employs mental process that are conceptual (abstractions, using analogy to translate across contexts), systematic (composed of different components with interfaces that interact to produce intended or emergent behaviors, pattern finding, and connecting situations that are not obviously related), imaginative (creative and visual), and opportunistic (searching for and grasping new information and value propositions).  The strategic thinker applies all of these cognitive processes in the orientation towards future success.

What Strategic Thinking is Not….

  • Strategic thinking is not the same thing as critical thinking. Although critical thinking is conceptual and systematic; experience shows that critical thinkers are less likely to be imaginative and opportunistic. Critical thinking can be a useful part of strategic thinking, but many critical thinkers are unable to think strategically; for example, designing a strategy to prevail over a competitor.
  • Strategic thinking is not the same thing as creative thinking. Creative thinking is imaginative and playful. Typically, creative thinking attends to a lesser degree to concepts, systems, and opportunities. However, creative thinking exercises often place no attention on the future success orientation. Creative thinking can also be a useful component of strategic thinking, but they are not identical. Again, strategic thinking involves designing a strategy to prevail over competitors; that is not something we naturally consider in creative thinking.
  • Strategic thinking is not the same thing as visionary thinking.  Visionary thinking is often simply dreaming big with the intention of inspiring others to adopt the vision. While visions might be useful, they need to be balanced with realism, data, and insights as to how to achieve the dream.  Strategic thinking involves a deeper level of conceptualizing – compared to visionary thinking – because the outcome that is envisions will only be achieved through creating and executing a strategy.
  • Strategic thinking is not the same thing as strategic planning or long-range planning. Many have experienced strategic planning or long-range planning as attaching words to the organization’s annual budget. Still other writers refer to the front end of structured business planning processes as strategic thinking, but that implies that the same action would apply to other fields where strategy is practiced: politics, military, sports, games, etc. Frankly, this is just sloppy reasoning on their part.  Organizations create strategies to achieve success, and the process of doing this is often termed strategic planning. However, as the paragraphs below point out, strategic thinking is an individual activity to be harnesses by group processes. Strategic thinking produces insights, which become inputs to the strategic planning process. The practice of strategic thinking by the individual may inform strategic choices and decisions.

Only Individuals Can Practice Strategic Thinking

Any kind of thinking is governed by the mind, or more specifically the brain.  Commonsense tells us that individuals – even people who are genetically identical – think differently and have different learned responses to coping with the world around them.

It follows from that reasoning that organizations do not practice strategic thinking because there is no single brain or mind at work. Thus, strategic thinking refers to an individual’s style of thinking.

The transition of individual thinking style to organizational process is this:

Organizations are collections of personalities that share some common purposes and culture. Individuals within the organization collaborate by surfacing  each individual’s thinking and sharing that those insights with others. Thus, thinking is an individual cognitive capability that generates insights and collaboration is a social process of merging and adapting those insights to meet a strategic challenge.

Individual Strategic Thinking and the Organizational Capacity for Strategy

Organizations intending on improving strategy should start with the previous section: the recognition that individuals are the practitioners of strategic thinking. Here is a three-pronged approach:

1. The organization should improve individual in strategic thinking competency. This could be done by training or coaching executives, high-potential employees, and those individuals who express interest in contributing to strategy.

2. It should create a cadre of individuals with competency in strategic thinking.

3. It should emphasize collaboration in its strategic planning process. This collaboration is multifaceted: up, down, and sideways in the organization.  The focal point of this collaboration is on identifying insights and sharing/combining/exploiting those insights with resources to achieve competitive advantage.

Each individual has a different set of experiences and perspectives.  The challenge is to bring together the experiences and perspectives – and individual insights – into a synthesized understanding of the situation and the need for coordinated actions.

Do you agree with the definitions and distinctions?

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