Thursday, March 12, 2009

Being strategic in volatile times

One of the responsibilities of leaders and managers is to pay attention to the strategic challenges and opportunities facing their organizations. This is a difficult enough task in normal times; it becomes particularly challenging in the volatile times in which we find ourselves today. There is so much noise being generated by people trying to make sense of emerging developments that it can become almost impossible to see the forest from the trees.

So how is a manager to attend to this responsibility? One way is to engage in the continual practice of strategic thinking and action. This involves the process of scanning the horizon, identifying and making sense of emerging opportunities and challenges, and considering what appropriate responses the organization might make to what is going.

In working recently with a client on their strategic agenda, I was helped by the way that John Bryson frames Strategic Issues. He defines these as “… a fundamental policy question or challenge affecting an organization’s mandates, mission, and values; product or service level and mix; clients, users, or payers; or costs, financing, structure, or management.” (Bryson Strategic Planning for Public and Nonprofit Organizations p.30)

What is helpful in this definition is that strategic issues are only relevant to the extent that they impact on core aspects of the organization's purpose, life, and work. By using the lens of Strategic Issues, you can focus on what is truly important to the organization. With the attention focused on issues rather than solutions, you can open up your options for what you might do. Of course, there is a tension created when you are facing issues and don't have a clear resolution in sight, but Bryson believes that this tension is actually useful as it prompts organizational members to engage in discussion and debate that can lead to organizational change.

You are freed up from being concerned about situations where there is nothing that you can do, and you can direct your energy to the things that you can influence. Strategic thinking should have an action orientation, and so you help the organization focus on what it can do to address strategic issues it faces.

While there is an obvious strategic issue facing most organizations in the current economic and financial crisis, it is important that we not allow ourselves to be diverted from consideration of other, equally consequential, issues that may affect the mission and operations of our organizations. One tool I have found helpful over the years is the STEEPLE framework – its usefulness lies in its wide vision of analysis, and a reminder to consider each one of its component parts.

Some starting questions to explore:

* Social:
Organizational and social issues, including competition/cooperation, capacity, management commitment, beneficiary engagement, conflicts, etc.
* Technology:
Cost, availability, supply-times, replacement periods, maintenance, electricity, software, infrastructure, training, support, etc.
* Economic:
Economic and Financial status and trends; inflation, cash flow management, financial management systems, procurement, etc.
* Environmental:
Weather patterns and fluctuations, seasonal changes, natural disasters, etc.
* Political:
Elections, parliamentary processes, policy and legislative processes, cabinet changes, etc.
* Legal:
Legislative and Governance environment, development of new laws, enforcement of laws, illegal/corrupt practices, penalties, etc.
* Ethical:
Ethical behavior of stakeholders (including staff, suppliers, beneficiaries); adhering to ethical standards of behavior, etc.

Using this tool to consider and assess the likelihood of a variety of factors, you can then apply the Strategic Issues lens to focus on just those key issues that have the potential to impact on the purpose, products and services, stakeholders, and economic base of the organization.

Our website contains a number of tools and other resources to help you deepen your capacity for strategic thinking and action