On Strategy
Do we want to win, or just show up?
‘Strategy’ is one of the world’s most misunderstood concepts. Every organisation thinks they have one. Few do.
Almost every ‘strategic’ document can more accurately be described as a marketing exercise attempting to convince others (e.g. concerned public, shareholders, funding agencies) of its existence. A list of actions with some narrative justification is merely a snapshot in time that becomes increasingly incoherent as circumstances change. It is impossible for a strategy with five equal principles and dozens of competing priorities split across 16 chapters to guide action as circumstances develop.
Strategy is the art of seeing a vision of the future and working backwards to understand how to robustly bring that about. Change is always hard. Good strategy must be clear-eyed about capabilities and constraints, and ruthless in its prioritisation of objectives.
Core Elements
-A single coherent goal. This should be an outcome (better X), not an output (build Y).
-Explicit priorities in achieving that goal.
-A rough course of action based on a realistic assessment of the constraints, available resources, and potential risks.
-Maximises information flow between active participants, maintaining coherence and enabling course correction when things aren’t working.
-Flexibility to deviate from earlier designs when the unknown (or enemy action) is met.
-Each action should help make the next step towards the goal easier.
Good strategies will tend to embody these elements, but they are not to be confused with the strategy itself. Management tools and government processes are usually designed, in theory, to encourage strategic thinking, but often end up as a box-ticking substitute for strategic thinking.
Examples
-The 2024 Harris/Walz campaign outspent the Trump campaign 2 to 1, but a systemic failure to target undecided voters led to one of the worst election campaign performances of the 21st Century. Polling showed Harris outperformed Trump in the debates, but lacking a clear and coherent strategy, her campaign staff targeted messaging and resources to play to the Democratic base, such as spending tens of millions on stadium concerts that could only ever attract already committed supporters, or refusing to appear on Joe Rogan in order to appease Democratic activists1. Was the strategic goal of the Democrats to win the election, or to maximise good vibes among the party?
-In 1866, the Austrian Empire maintained an unrealistic assessment of both its capabilities and that of its neighbours. It overstretched and being unable to decide on priorities between its Italian and German territories, pushed the Prussians and Italians into an alliance and consequently lost on both fronts.
-Chiang Kai Shek was an intelligent and charismatic man, skilled at political maneuvering, and a successful field marshall, but he lost the Chinese Civil War despite an initially commanding position because he failed to address the strategic realities of overstretched forces and political corruption ebbing away at popular support2.
-The US Covid-19 Vaccine rollout failed to prioritise vaccinating people as quickly as possible due to concerns around equity. It consequently achieved neither efficiency nor equity, leading to thousands of needless deaths due to delays. Doctors lost their licences for administering doses that would otherwise have expired. The story of VaccinateCA is an absolute scandal, a case study of how badly things can go wrong when priorities are muddled. It’s a must-read for anyone interested in improving the public sector.
-The New Zealand Transport Agency’s (NZTA) approach to funding cycling infrastructure, while ostensibly linked to a demonstration that each project formed part of a broader network strategy, in practice prioritised funding on a project-by-project basis according to metrics unrelated to ‘will this project build or harm public support? [i.e. the key constraint]. Funding flowed to big projects along major transport corridors despite the physical constraints these often face. Traffic congestion, already a problem, often increased as a result, and drivers naturally blamed the cycleway. Worse, NZTA’s review process was structurally unable to recognise this problem, choosing instead to focus on capital delivery statistics rather than face the reality of a steadily eroding mandate. No surprise that cycling funding was cut with the change in government who sensed easy political points to score.
Cycling, like any other form of transport, is subject to network effects where demand grows non-linearly with the growth of a network. A better approach to a network rollout would have been to successively work through easier projects, building both latent demand and public support for the more difficult ‘capstone’ projects.
Final Thoughts
Not every good strategy succeeds. Not every poor strategy fails. There are times when a higher-variance or risky strategy is appropriate.
Encountering change for the first often induces a stress response. Others will be disappointed the change doesn’t go far enough. Success lies in letting people down at a rate they can absorb.
Good strategies usually make for poor marketing material. There’s a cost in explicitly stating that something one group of stakeholders wants is less important than something else. This is an acute problem for public bodies whose records must be made public, and is part of the reason for the scope creep and cost blowouts commonly seen with major public projects. This can be avoided, but requires politicians/decision-makers to have both the courage and trust in the delivery team to eat a few bad news cycles in order to set up a longer-term payoff of successful results delivered on time and on budget.
Hard to overstate this error. Rogan’s three-hour-long Trump interview received as many cross-platform views as the official debate on ABC. Rogan can certainly often be distasteful or harmful (e.g. over vaccines). However, to not take the (free) offer from a guy who routinely gives sympathetic interviews to Democrats like Bernie Sanders was not only an enormous missed opportunity to communicate your message but also made the campaign appear as weak to many younger voters as refusing to appear on a televised debate would to older generations.
Chiang had great ability, but these were often employed counterproductively due to a lack of strategic thinking. In 1943, Chiang and his wife maneuvered themselves into being the first to meet with the British during the pivotal Cairo Conference. It was quite the coup in terms of prestige for China and Chiang to keep the Americans waiting! Unfortunately, as Chiang should have understood, the British position on China could not be resolved until after they had met with the Americans to decide on global strategic priorities. The meeting was doomed to be unproductive. A later meeting would have been more able to influence the details of Allied East Asian policy, but this opportunity was missed. Further, Chiang’s behaviour here convinced the British of his poor strategic ability, contributing to his exclusion from future conferences like Yalta where much of the post-war international order was ultimately decided.