There are plenty of myths or half-truths about what strategy is and is not – in many ways overuse has stripped this term of core meaning.  HBR published a short article on this topic by Stephen Bungay from the Hult International Business School (Ashridge) in London. I have distilled the essence of it below: three pernicious myths about strategy.

Myth 1: Strategy is long term… and by inference not useful
Strategy is not about the long or the short term, but about how your business works: the sources of value, the cost to deliver value to customers, and how and where you choose to compete and how these factors combine to create a differentiated position in the markets you choose to operate in over time.  In other words, what Bungay terms ‘depth’ of thinking.  Strategy is about where you invest today to shape that advantage and market position in the future.

Myth 2: Disruptors constantly change strategy
Bungay cites Amazon and Google as behemoths that appear to change or revise strategy all the time. He says no.  Their strategies are not about constant product/solution innovation, but about leveraging their platform assets and capabilities to add volume because volume creates scale economies and scale economies create high barriers to entry and pricing power – competitive advantage that is not easy to copy. This strategy is simple and has never wavered.  If there is any other implicit insight, it is that disruption is itself a misnomer.  It requires a long and sustained build-up and the alignment of technology and market forces (timing) to succeed.

Myth 3: Agility is more important than strategy
It is easy to observe companies acting at high speed, maintaining a high tempo and being highly responsive, but this is not strategy.  Agility is the beneficial outcome of the development of a set of internal capabilities a business develops but it is not a strategy.   Strategy is the decision-making framework that determines resource allocation that ultimately determines the what, why, when, where and how business agility is applied. Agile businesses that respond to market moves in a way that creates value are deep in strategic thinking.

If you are not deep into the strategy for your business and are happily busy in the day-to-day, it may be time to take stock and focus on building the capabilities you need to succeed in the markets you want to play in.

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