Rethinking strategy: 3 approaches in action
In business, "strategy" is one of the most overused - and misunderstood - concepts. Too often, it’s reduced to a detailed plan or a quick fix, robbing it of its depth and transformative potential. But when done right, strategy is a dynamic framework for clarity, focus, and sustainable success.
Let’s explore three perspectives that redefine what strategy is (with real-world examples) and what it is not.
Strategy as value creation
"Strategy is a unique way of creating sustainable value creation." - Jeroen Kraaijenbrink
At its core, strategy is about crafting enduring value - not just for shareholders, but for all stakeholders, including employees, customers, and society. This involves answering critical questions:
What unique value do we bring to the table?
How do we create and sustain that value over time?
For example, Apple has mastered the art of value creation through its ecosystem approach. Apple doesn’t just sell products; it creates an interconnected world of devices and services (iPhone, Mac, iCloud, Apple Music). The seamless integration is its unique value proposition, offering users convenience, reliability, and a premium experience.
This focus on long-term value creation sets Apple apart. It doesn’t just aim to sell individual products but builds customer loyalty that ensures repeat business and a competitive edge.
Value creation means thinking beyond transactions. It’s about building relationships, solving real problems, and delivering outcomes that matter - not just now, but in the future.
Strategy as a philosophy of being
"Strategy is a series of questions." — Inspired by Seth Godin
Strategy is not just a plan either; it’s a mindset. It’s about constantly revisiting questions of identity, purpose, and focus:
Who are we, and who are we not?
What do we stand for?
What will we choose to do - and not do?
Patagonia offers a clear example of this. Known for its environmental activism, Patagonia famously ran a campaign urging customers not to buy its products unless absolutely necessary.
This counterintuitive strategy reinforced its commitment to sustainability and resonated deeply with its customer base. It wasn’t just a marketing gimmick - it reflected the company’s core identity and values.
A strong strategy guides actions with purpose, ensuring every decision aligns with the "big picture." It’s about saying no to opportunities that don’t align with who you are.
Strategy as learning
"Strategy is a set of hypotheses." — Amy Edmondson
Gone are the days when strategy was about having all the answers upfront. In today’s fast-paced world, strategy must be adaptive. It’s about forming hypotheses, testing them, learning from mistakes, and iterating.
Netflix provides a great example. It started as a DVD rental service. When streaming technology emerged, it pivoted to online streaming. Later, it began creating its own content, disrupting the entertainment industry once again. Each shift involved experimentation and risk-taking, informed by data and customer feedback.
Netflix’s ability to adapt and learn has been a cornerstone of its success. By treating strategy as a process of continuous refinement, it has stayed ahead of competitors and shaped an entire industry.
Strategy isn’t about getting it perfect from the start. It’s about being willing to test, fail, and refine - turning insights into action.
What strategy is not
To truly harness strategy’s potential, it’s essential to debunk common misconceptions:
Strategy is not a rigid plan.
Plans are important, but they’re not the same as strategy. Plans often fail when circumstances change. Strategy provides a framework for decision-making, allowing flexibility and adaptability.
A classic case is Kodak’s failure to adapt. The company stuck to its rigid plan of dominating the film industry, ignoring the rise of digital photography. Its inability to adapt its strategy to new realities led to its downfall, despite having early access to digital technology.
Strategy is not a quick fix.
It’s not a set of short-term actions designed to “fix” problems. It’s about building a sustainable path forward.
WeWork is a cautionary tale. They provided flexible office spaces and co-working environments for businesses, entrepreneurs, and freelancers. The business model focuses on leasing large office spaces, designing them with modern and attractive features, and then subleasing smaller portions of these spaces to clients on short-term, flexible contracts. However, its rapid expansion lacked a clear long-term strategy. The focus on short-term growth, at the expense of financial sustainability, led to a highly publicized collapse in 2019.
Strategy is not a solo endeavor.
Effective strategy is collaborative. It requires alignment across teams, departments, and leadership to ensure buy-in and execution.
Microsoft’s turnaround under Satya Nadella is a prime example. Nadella prioritized collaboration and cultural change, aligning teams around a unified strategy focused on cloud computing. This shift revitalized the company and drove significant growth.
Unlocking the true power of strategy
By reframing strategy as value creation, a philosophy of being, and a learning process, we can unlock its full potential:
It’s not about rigid frameworks or fixed answers - it’s about adaptability.
It’s not about quick fixes but building long-term value.
It’s not about solo efforts but fostering collaboration and alignment.
The question isn’t “What’s the plan?”, but instead:
What value do we create?
Who are we, and what do we stand for?
What are we learning, and how do we adapt?
When you answer these questions, strategy becomes more than a buzzword. It becomes the compass that guides your decisions, actions, and growth in an ever-changing world.