W icked, messy problems have no clear, right answer and no clear end point — they’re not solved and done. These problems usually exist in a fluid environment where challenges change, where stakeholders have different, often competing agendas, and where competition presents an ever-varying array of threats. Sounds like trying to craft and implement a business strategy. It’s not easy. Looking through the research, it doesn’t take long to see that most strategic efforts mostly fail. Could be a weakness in planning, communication or execution, but the end result is the same. Various studies have cited failure rates between 70 and 90 percent. With rates that high, how can strategy be important? But look at it another way. Strategy might be so important that even if it fails 90 percent of the time, it still makes a significant contribution to the progress of the enterprise. If a 10 percent success rate contributes to a firm’s profitability, think what a 20 percent rate could do. Strategy might be so valuable that even minor improvements in strategic implementation mean major improvements in business success. You could look at a firm’s strategy as the way it creates and captures value
and keeps creating and capturing over time. From that perspective, strategy is a goal — to create and capture value — and a means — how that value is created and captured. Value is usually produced by service to stakeholders. Now there are customer stakeholders, those who buy the products the firm creates; investor stakeholders, who look for a return on their dollar; and employee stakeholders, who expect compensation for the ways they create and capture. In the best of worlds, those groups should be aligned. They should all be headed in the same direction. If they are aligned, are they engaged? It’s not enough to yawn and say, “oh yeah, tell me what’s next.” To effectively implement strategy, those stakeholders must be active, motivated participants in the firm’s progress. That thought prompts some questions: do those stakeholders see the value of their efforts in the firm’s progress? Do customers, so appreciative of the products and services the firm provides, become not only its best marketers, but its innovation partners? Do investors, so pleased with their returns, continue to invest? Do employees know that the firm tolerates failure and rewards hard work and creativity? If you look at strategy that way, it’s more about service to stakeholders than command and control. Maybe start there; and give yourself a break. You won’t get it all right. You don’t have to.
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