Strategy and Change

3Three Lenses

STRATEGY IS ABOUT trade-offs. In every organization, the chief executive faces difficult decisions on myriad issues such as which market opportunities to pursue, where to invest scarce resources, and how to ensure results through the right governance and controls. They make these decisions in the context of environmental factors like emerging trends, competitor actions, customer priorities, and the requirements introduced by regulations or employee expectations. In Chapter 1 we called this the decision ecosystem, represented here in Figure 3.1.

As leaders work within this decision ecosystem, they make fundamental choices in deciding how to define their strategy and how to drive strategic change. GE elected to take a top-down, directive approach to strategy. In doing so, they decided against the kind of bottom-up, incubating approach favored by 3M. Walt Disney was prescriptive in driving his vision—he was known for dictating the placement of trash cans at his theme parks. Nelson Mandela chose to take a relatively more collaborative approach, using the Truth and Reconciliation Commission to facilitate a shared understanding of the nation's troubled history. These kinds of trade-offs are embedded in the way every organization works—we can see them in the processes they establish, the culture they promote, and the kind of people they hire. Once established, these practices function as organizational competencies—the unique skills and abilities used achieve the organization's ...