Strategic Choice

To achieve comparative advantage you must choose. Are you slave or free? Which is more important, security or opportunity? Are you seeking a near-term exit or a long-term home? Who are you? Who are you not?

Moses was a very capable leader. He was skilled at creating a meaningful and motivating context through the stories he told and the purposes he advocated. Moses had profound insight regarding the fundamental strengths of individuals and organizations. He cultivated creativity, he empowered, and he loved. Moses refrained from interfering with the free choice of others, but he provided effective frameworks for making good choices. He demonstrated remarkable resilience. Moses was an expert practitioner of six key techniques for producing unique value.

But with all his strengths Moses still had to choose. He could not be all things to all people; he could only be himself – his true self. In leading his people he had to make a fundamental strategic choice, a decision that accurately reflected the reality of his people and their condition.

Strategy is the outcome of analysis. But strategy is not analysis. An effective strategist will consider a whole host of internal and external factors in assessing threat, vulnerability, and strength. A strategist will seek a careful and accurate definition of risk. But finally the strategist must make a choice. The choice can be open to change, but a choice must be made and trade-offs accepted.

In my consulting practice I have often found, especially with larger clients, superb strategic analysis. But the willingness to make a choice based on the analysis is often absent. There is an arrogance, or greed, or – most often – fear that leads many managers to avoid making a real choice.

I once worked with a jurisdiction to assess the threat of terrorism and develop an appropriate prevention strategy. Realistic threats specific to the jurisdiction were outlined. The current capabilities of the jurisdiction were reviewed. Some gaps between the perceived threats and current capabilities were identified and a set of risks defined. The analysis implied some likely priorities, but determining explicit priorities requires a set of choices that – very appropriately – could not be made by the analysts.

Even with superb staff work in-hand leadership resisted making choices. The most consequential risks outlined by staff related to agro-terrorism, an attack on the water system, and biological or radiological WMD. The jurisdiction almost certainly did not have the resources to deal effectively to prevent and mitigate all three threats. But leadership refused to choose and – in essence – left the jurisdiction equally vulnerable to all three threats

Another client was a pioneer in the development of a new product. The product was well-received in the market. The product could, however, be adapted to many purposes and was highly replicable. As the pioneer, the client had the unique opportunity to choose its preferred channels and categories. The founder refused to choose. He wanted to own and defend every niche. This was beyond his capacity. Within three years the company had gone from being the market leader to being an also-ran in every niche.

Michael Porter writes, “Strategy is making trade-offs in competing. The essence of strategy is choosing what not to do. Without trade-offs, there would be no need for choice and thus no need for strategy.” (Porter, Michael; What is Strategy? Harvard Business Review, November-December 1996)

The Books of Moses include a number of “thou shalt not’s.” Saying no – and knowing when and why to say no – may be the most crucial decision made by senior leadership. The decision not to do one thing is often critical to focusing on and actually achieving another.

“General management is more than the stewarding of individual functions,” writes Porter. “It’s core is strategy: defining and communicating the company’s unique position, making trade-offs, and forging fit among activities. The leader must provide the discipline to decide which industry changes and customer needs the company will respond to, while avoiding organizational distractions and maintaining the company’s distinctiveness. Managers at lower levels lack the perspective and the confidence to maintain a strategy. There will be constant pressures to compromise, relax trade-offs, and emulate rivals. One of the leader’s jobs is to teach others in the organization about strategy – and to say no.”

When you choose to say no, you must also be able to articulate why and communicate how the no reinforces the chosen strategy and will advance the goals of the enterprise. This explanation will usually relate to either strategic integration or strategic consistency, or both.