Vision and the Quality of Strategy
In the first post on the topic of connecting strategy as an outworking of vision for the organization, the points were made that the vision must be clear, shared and substantive if there is any hope of it gaining traction on an organizational level. This naturally led to the suggestion that vision must connect with a strategy that has qualitative value, or it is no different from any other suggestion that may or may not be working in our present time in any given industry. In this post the discussion of strategy is continued by contrasting it with the pursuit of efficiency and ultimately, organizational effectiveness.
Effective Versus Strategic
There are many instances where as an organization (and any configuration of divisions within that organization) in its pursuit of operational effectiveness can completely displace the advancement of vision and strategy. In its worst-case scenario, the pursuit of efficiency may only ensure that wheel spinning occurs with the least amount of friction. But this is not to say the efficiency should not almost always be a goal and a consideration. What it is to say is that efficiency and effectiveness (a debate in itself) do not necessarily take the organization somewhere, vision and strategy can.
Nearly twenty years ago, Michael Porter made a significant point regarding the strategic management process that I think should be kept steadily in view. Namely, that operational effectiveness and business strategy are not the same thing, and should not be confused. He describes a scenario of tireless activity, but maybe the wrong goal:
The pursuit of operational effectiveness is seductive because it is concrete and actionable. Over the past decade, managers have been under increasing pressure to deliver tangible, measurable performance improvements. Programs in operational effectiveness produce reassuring progress, although superior profitability may remain elusive. Business publications and consultants flood the market with information about what other companies are doing, reinforcing the best-practice mentality. Caught up in the race for operational effectiveness, many managers simply do not understand the need to have a strategy.
Porter makes the point that operational effectiveness and business strategy are both imperative to superior performance, but their differences are what will ultimately enable a firm to outstrip its competitors in the for profit world, and surmount challenges in the non-profit world. This difference, and emphasis on difference could prove to be the competitive edge in an ever-crowded marketplace due to the avalanche of available information. As stated earlier, efficiency and effectiveness should always be an operational goal, but there is no one model or degree of emphasis that we can be cut and paste from one organization to the next. Instead, the visionary leader will allow the various challenges to bubble to the surface, then adopt a strategy as appropriate in the immediate context, regardless of the organizational size or type. From there, the pursuit of effectiveness will underpin that vision and strategy and add some of the horsepower needed to carry it out.
Porter, M. (1996). What is Strategy. Harvard Business Review.