Rethinking Strategy

CHAPTER 7 The strategic challenge

Proficiency at strategic design is an internal capability that is difficult to replicate

The fluidity of change ensures that a strategic outlook can never be ‘a magic formula for success for all time’.¹ Over time, the advantages that flow from having a market-leading strategy are diminished by shifting market conditions or the innovation of competitors — hence the need to continually develop new and distinct strategies to thrive in a constantly changing environment.

This need for ongoing strategic transformation shifts the internal emphasis from developing a one-time best strategy to designing the best strategy process. In turn, proficiency at strategic design becomes what David Teece calls a dynamic capability, an internal process delivering strategic value that is difficult to imitate. With such proficiency, volatile conditions become your preferred environment and uncertainty provides the basis for a sustained competitive edge. This is the strategic advantage delivered by scenarios.

In chapter 4 I introduce an integrated and dynamic process for strategy development specifically designed to optimise organisational performance in an uncertain and turbulent environment. At the core of this process sits scenario planning. Part III describes this strategy process in detail, with each chapter corresponding to the relevant components of the process shown in figure 7.1.

Figure 7.1: an integrated and dynamic strategy process

As the organisation ...