Strategic Thinking

Strategic thinkers do three things:

1.    They think about the large-scale environment around them.

2.    They think about the future.

3.    They engage others in doing the same, resulting in a “deeply shared, well-tested view of the future.”

Napoleon the StrategistBiographers of Napoleon Bonaparte talk about his ability to size up a situation with a single coup d'oeil, (pronounced koo-DOY), meaning “a stroke of the eye” or “glance.”  Napoleon was so knowledgeable about his strategic situation—the landscape, the enemy, available technology, similar situations from the past—that he could understand and respond quickly to ever-changing circumstances.  In the first Gulf War, in 1990, Norman Schwarzkopf took advantage of the latest technological advances to obtain “real time” data on the strategic situation in Kuwait and Iraq, which enhanced his ability to understand the strategic environment and think strategically. 

In addition to paying attention to current conditions, the strategic thinker is oriented toward the future.  He or she is “intent driven,” looking at the dynamics of the competitive environment with purposes and desired outcomes in mind. With strategic intent in mind, the strategic thinker also understands that strategy must emanate or diffuse to others.  In preparation for the next phase—articulation of strategy—the strategist initiates conversations, beginning to activate the “group mind” to refine and craft strategy.

Of course, there is debate among experts as to what exactly constitutes strategic thinking.  Michael Porter, perhaps the most widely cited expert on organizational strategy, says that “strategic thinking rarely occurs spontaneously.” As if to prove his point, Porter provides a dry, deliberate, and distinctly unspontaneous methodological approach to the quest for competitive advantage.  Other eminent strategy theorists have argued just the opposite—that strategy-making can also be thought of as a creative process, as rich in spontaneity and magic as any other art. After all, even mathematicians like Poincaré and Newton held that their most prized insights burst in part from spontaneous thought.  Certainly, nothing about the field of strategy is any more formulaic and logical than that of mathematics. 

Henry Mintzberg... Influential Strategic ThinkerHenry Mintzberg argues that organizational strategy is often emergent. That is, we do not arrive step-by-step at the answers to strategic questions as we do at the result of a math equation.  Rather, strategy emerges and changes as the strategist observes the world and reflects upon the dynamics of the competitive environment. 

In articulating his “pin-prick” model, Evan Dudik suggests that having a single, straightforward “strategic plan” can be debilitating.   He argues that overly specific strategic plans limit an entity to one particular set of attempts and outcomes, which is tantamount to “putting all your eggs in one basket.”  Rather, Dudik suggests, a variety of strategic initiatives should be pursued as a mass of pin-pricks, rather than following one favored strategy, striking in one forceful but clumsy blow.   Just as a general might authorize a series of skirmishes to identify weak points in an enemy’s position, so might the strategist instigate a variety of exploratory actions, monitoring each for signs of a larger opportunity. In this manner, rather than nurturing one big idea, the strategist maintains a portfolio of ideas, each of which has some chance of becoming a strategic breakthrough  Abraham Lincoln recognized the importance of keeping his options open.  He said, “My policy is to have no policy. I shall not surrender this game leaving any available card un-played.”  That is to say, Lincoln reserved leeway for events to dictate strategy—a notion now known as emergent strategy  (Sandburg, The War Years, p. 200).

The ability to keep options open, to avoid locking in on a particular approach, is influenced by one’s brain dominance and other forces of personality.  Confronted with an important strategic decision during the 1998 NFL player draft, the San Diego Chargers employed Jonathan Niednagel for his psychological insight.  That year, the Chargers “owned” the right to choose any player “on the board” from the pool of players leaving the college ranks.  The top two players that year were Peyton Manning of the University of Tennessee and Ryan Leaf of the University of Oregon.  Using a personality instrument known as the Myers Briggs Type Indicator (MBTI), Niednagel found that Manning had what is called an “ESTP” profile, while Leaf was an “ESTJ.”  The difference between the two men, according to the MBTI, boiled down to “P versus J.”  In Myers Briggs parlance, the P stands for Perceiving, and is characterized by flexibility and spontaneity.  The J stands for Judging distinguished by a tendency to be deliberate and structured.  This dimension of personality seems to affect how quickly an individual comes to a decision.  Judging types have a high need for closure, and will tend to make final decisions quickly on the basis of information available.  Perceiving types prefer to keep options open, and are prone to revisit and reconsider decisions as situations change.

Peyton Manning's flexible thinking style gives him a competitive advantageWith this information in hand, Niednagel offered a strong and unwavering prediction.  While there was not much difference between the two quarterbacks in terms of physical ability, Manning would be far more suited to the NFL game.  Manning’s proclivity toward the perceiving (P) end of a psychological continuum meant that he would be able to scan the football field for fast developing options and make appropriate snap judgments.  He possessed the “glance,” the coup d'oeil. Niednagel predicted that Leaf, on the other hand, would be shackled by his judging (J) personality profile.  He could be expected to lock in on a particular receiver downfield and would not be able to perceive the other options available to him as each football play developed.  Manning was selected first overall in the 1998 NFL Draft. Ryan Leaf was the second pick that year, going to the San Diego Chargers, who ignored Niednagel’s warnings.  Subsequent events validated Niednagel’s analysis.  Peyton Manning, of course, went on to a Hall-of-Fame-caliber career in the NFL.  Ryan Leaf struggled through a brief and unsuccessful career as an NFL quarterback. 

The story of the two quarterbacks illustrates the extent to which thinking style affects the ability to make quick tactical decisions on the field and serves as a fitting analogy to long-term, strategic decision-making.  Locking in on options—following through on specific, carefully orchestrated strategic plans—can indeed limit a strategist in pursuit of long-term mission and desired outcomes.

Strategic thinking, then, is characterized by openness to new and different ideas.  And one way to generate new and different perspectives on strategic situations is through the use of metaphor, or its close relative analogy, perhaps the most advanced form of human thinking.  As Aristotle said in Poetics, “the greatest thing by far is to be a master of metaphor.”  It is “a sign of genius, since a good metaphor implies an intuitive perception of the similarity in dissimilars.”

In their Harvard Business Review article entitled “How Strategists Really Think,” Giovanni Gavetti and Jan W. Rivkin show that reasoning by analogy plays a major role in the thinking of successful strategists.  As an example, these writers point to Intel chairman Andy Grove’s story of how he came up with an important business strategy.  Attending a management seminar, Grove heard the story of how fledgling “mini-mills” in the steel industry began in the 1970s to offer a low-end product—inexpensive concrete-reinforcing bars known as rebar.  Establishing market share with the low-end products, these steel companies then began to migrate up the hierarchy of products toward the higher-end, more lucrative steel products.  U.S. Steel, which had ceded the low-end products to the smaller and seemingly insignificant players, was caught unawares by the companies attacking the market for their core business and lost market share over a number of years. 

An epiphany struck Andy Grove as he sat in that management seminar, thinking about the steel industry. Using what Gavetti and Rivkin call “analogical thinking,” Grove saw that Intel was sitting in a similar situation to that of U.S. Steel in the 1970s.  Intel had theretofore leaned toward ceding low-end computer chips to niche players, a strategy that, Grove now realized, would put Intel in a dangerous situation.  He began to see low-end computers as “digital rebar,” a metaphorical image that helped him in articulating his strategy to Intel management. “If we lose the low end today,” Grove said, “ we could lose the high end tomorrow.”  As a result of this thinking, and the deliberations that followed, Intel redoubled its efforts to market the low-end “Celeron processor” for low-end personal computers. 

The opportunity to engage in metaphorical or analogical thinking exists for any one of us at any time.  We all walk around with a vast library of experiences—from work, education, hobbies—to draw upon as we engage in strategic thinking.  The trick is in becoming more open to seemingly unrelated thoughts and allowing appropriate time for brain processing in the theta mode.

To engage in strategic thought, you must think and reflect on the big picture—on the diverse players and forces in your environment.  Think about the future.  Use your right brain for intuition and wisdom. As Isaac Newton said “truth is the offspring of silence and meditation.”