Just a decade ago, strategic management was touted as the highest and most intellectual function in the business world. Strategic management or organizational level planning was concentrated in the hands of a select few who belonged to the upper echelons of their companies. But somewhere along the way, as organizations have become more flat and less hierarchical, the King of all management functions has been dethroned to become a commoner, and for good reason!
Becoming a commoner hasn’t decreased the importance of strategic management as a function, but ironically has made it even more critical to a company. In fact, Strategic Management is still a major course requirement in the syllabi of most reputed business schools across the globe. The way strategic management is being discussed and taught, however, has transformed. So what exactly transpired over the past couple of decades, and how have things changed for strategic management as a function?
Rise of the Knowledge Economy
Today we live in a knowledge economy where jobs are increasingly driven by technology and knowledge. In this knowledge economy, it has been more than a decade since any professional could research a business problem, department, or team in order to build a strategy and simply hand it back over to his/her client to execute. Strategic management is now all-pervasive, and it is embedded into the DNA of every job within a company. Every individual is strategizing even as he/she implements and executes tasks. This change could be attributed to the fact that valuable organizational data and insights are something that most employees in a company can and should be able to access.
The availability and access to organizational data, which is as vital a resource as financial data and human capital, have fundamentally changed strategic management. It has metamorphosed from a function that was once only long-term and strategy-focused to a function that is also short-term and task-oriented. Strategic management has also increasingly become more about implementation and execution, with an element of strategy woven in at every step of the way.
Strategy is good but not good enough
Consultants have traditionally fit right into the definition of strategists. As external strategists hired to help navigate business problems, consultants have had a bad reputation for overcharging clients while sitting in their ivory towers, creating long-range plans to problems that do not really affect them. Typically this sort of strategic engagement would last several months and end with handing over a neatly organized document of findings and plans. This breed of traditional consultants is fast becoming extinct, however. Although they still serve as strategic partners, a new and better breed of consultants not only discover deep insights about their clients, but also design strategic solutions to business challenges based on these insights and help implement solutions. These consultants also remain involved after the implementation phase to assure clients about the success of implemented strategy and help take remedial action in case there are gaps in the implementation.
We’ve seen this phenomenon of discovering insights, designing strategy, and assuring success even with contemporary business leaders such as VPs, Directors, and CXOs. While these business leaders still need to plan the overall strategy for their businesses and respective departments, they also need to be willing to roll up their sleeves and do their own grunt work. Managers and executives at every level have to execute at some level in addition to setting the strategy and delegating tasks to their team members. The lines between strategy and execution have blurred and are steadily fading away.
Busting the myth about Chief Strategy Officers
All this talk about strategy being all-pervasive, may lead to the question, why even hire a Chief Strategy Officer in the first place? Just like consultants, Chief Strategy Officers (CSOs) have also had to fight negative stereotypes about their role and dispel doubts. Contrary to the widespread belief, CSOs are not solely responsible for strategy formulation or planning. These professionals help with blind spots and oversights that affect other CXOs in their company when it comes to strategy formulation and execution. They also act as auditors of how overall strategy permeates through an organization.
CSOs are seasoned professionals who normally have three characteristics that set them apart, making them “specialists” in strategy, its implementation, and execution. They use a combination intellection, forethought, and activation to help businesses navigate today’s fast paced environment and the rapid changes that affect it.
Ultimately, this transformation of strategic management, especially over the last decade can be attributed to the explosion of organizational data and how is it increasingly easy to access and analyze. The way organizational data is collected, organized, and analyzed is crucial for the transformation for strategic management. It is little wonder that companies are spoiled for choice when it comes to selecting the right BI tools. By using the right tools and technology, companies can convert organizational data into organizational intelligence, and this can make all the difference when employees strategize and execute their projects.
By dethroning strategic management, the business world has been able to create more leaders. Companies are now better equipped to develop a culture of leadership, which in turn creates better employee engagement, better executive transition, and ultimately better growth.