Strategy is not X | Hacker News Reader

Strategy is not X

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120 pointsumerf60 comments

Interesting that he's not sure what a strategy consists of after reading the book. I read the same book and it does give a definition, with three essential parts, but frustratingly doesn't then link the examples back to show how they illustrate the definition.

Rumelt says good strategy consists of:

"1. A diagnosis that defines or explains the nature of the challenge. A good diagnosis simplifies the often overwhelming complexity of reality by identifying certain aspects of the situation as critical.

2. A guiding policy for dealing with the challenge. This is an overall approach chosen to cope with or overcome the obstacles identified in the diagnosis.

3. A set of coherent actions that are designed to carry out the guiding policy. These are steps that are coordinated with one another to work together in accomplishing the guiding policy."

A number of writers (Mintzberg being perhaps the most notable one) point out just how inconsistent definitions of strategy are. It’s hard!

I enjoyed Rumelt, but to some eyes, he over-simplifies. “Strategy as theory” for example isn’t well represented. There’s room for it perhaps in the second and third points, not so much in the first.

Thanks for referencing that. Maybe it's semantics, but as someone coming at this from a game design perspective, 1 and 2 are clearly strategic, but I'd have said 3 is tactical rather than strategic. Tactics are the mid-level actions/subgoals that are used to implement a strategy. You can have a strategy without tactics - though usually you will need them in order for the strategy to succeed.

Rumelt is fairly keen on a strategy having actions because otherwise it doesn't get linked to what people actually do. I don't know what actions he would consider strategic, but I guess things like 'enter/exit the market for X', 'develop the capacity to do Y in house' would be fairly obviously not tactical.

Actions and tactics in this sense are different. An action at a strategy level might be "cull products not aligned with a focus on the athli-leisure market" or "create a new line of footwear positioned around the fashion tastes of the West Coast market", or "investigate new formulations to reduce reliance on lithium".

They're not tactical - no-one has yet made a decision on how those things will be done, or what elements of the business will enact them, or what the management and operational implications will be and how they'll be dealt with.

It's a level of abstraction above tactics.

Thanks, I bought the book now.

I’m with you here. It was quite clear what is and isn’t a strategy by the end of the book. I even made a YouTube video summary of this topic outlining these points.

I think if you start with 1. you can figure out the rest from there. If you can’t see what’s broke, you can’t fix it.

I've seen the advice in other contexts that "if you get into a crisis, step one is to define what success is and what's failure". Otherwise you end up flailing around without accomplishing anything.

Definitely agree here. I've seen this firsthand in crisis ranging from car crashes to service outages. If nobody has a definition of success in these situations, then everybody is going to be chasing a soccerball like a group of toddlers and nobody is going to score a goal.

It always shocks me how many leaders struggle with what a strategy is in the business world. Typically, as the author mentions, they either present a goal, “XXX sales in Q1,” as a strategy or a checklist of tactics or actions. A strategy can be as little as a sentences or an entire plan, but it should be formalized. It is the “why” question. It answers the question of why you have people doing the things they are doing and keeps everyone on the same pages

A simplified example might be:

// Goal

xxx sales in Q1

// Strategy

Sell product at below competitor cost to capture market share and increase profit through efficiency of scale.

// Tactics

- decrease product price 10%

- promote price difference in advertising

- implement cost saving measures in customer support

I agree. It’s crazy how many senior people don’t understand strategy and can’t deal with complexity.

Ex, I once worked at a company that required creation of a two sided market (buyers and sellers). I proposed that we bootstrap the market by creating a variant of our product to enter an existing, complementary market. By offering a cheaper solution in the complementary market with clear benefits for users, its likely we would have been able to establish a user base that we could then use to stimulate the seller side of the market, thereby achieving our goal of creating a brand new market.

The strategy our management consultant CEO went with was to put ads on LinkedIn.

Nobody works there any more.

My theory is that people have been trained and rewarded for being “not wrong”. Strategy requires you to take a stance and get specific. Sometimes the strategy will not work.

I think we need to do a better job of encouraging this sort of thinking. I don’t remember where I heard but it was something along the lines of “we tell kids they can be whatever they want and then actively discourage them when they take the necessary steps to do those things by operating outside the box”. So this type of thinking becomes normal. Then when it comes to strategize people try to follow “best practices” and “proven techniques” which is kind of the opposite of strategy.

Yes, I like this comment a lot. Any true strategy will need to have a specific outcome, and therefore can fail if the outcome is not reached.

On the other hand, if you (or in my case the CEO) listen to any one of the thousand consultants who will tell you that, say, advertising on social media is a guaranteed path to sales, you can’t ever be wrong because you’ve implemented - as you say - “best practice” and “proven techniques”; you did your job but “for some reason” - externalities - it didn’t work. There was no strategy involved, but we don’t need to talk about that.

This kind of thinking drives me nuts.

Your theory also helps explain why people buy Exchange, or JIRA, or IBM in the olden days.

People want all the rewards with none of the risk. But what’s funny is they are still taking the risk of failure. It’s more that they can fail and shift all blame away by saying “we did it all right, it just didn’t work”. It’s easier than doing the work themselves.

I just think we would all be better off if we told people it’s OK to try and fail, as long as we learn from those failures. We need to support people trying new things. If we just follow prevailing wisdom, we can only tackle problems that are already solved.

And I think these comments summarize why consultants like Accenture, KPMG, McKinsey, etc survive today. They are for leaders who want to shift strategy risk away from their own responsibility. Whether a strategy succeeds or fails; consultants have a finite lifespan with the organization

Yea absolutely. So much of it is a shell game (in some companies) where you attempt to shift blame and take credit for successes. Those type of consultancies help facilitate the game.

Yeah as a (former) small business owner I’ve been thrown under the bus by consultants more times than I care to recall.

You’re an easy target when you don’t have the political pull to point out the absurdity of what’s going on.

What’s always been surprising to me is that more people don’t recognize it. My background didn’t give me the education I’m wish I had either, in fact I got the opposite. But it didn’t take all that long in the real world to see it. Maybe people just accept what they see and roll with it.

Yeah most of the gigs I’ve worked at where the big consultants have been involved have been all about the billable hours that the consultants can charge, and the internal managers who facilitate these transactions - in order to be able move to a cushy job in the same company, some months later.

It’s quite literally corrupt, but everyone seems to know and nothing gets done - because politicians are part of the revolving door. People like us who actually care about doing a good job are just cannon fodder.

Mostly I’ve just learned to avoid such projects like the plague. As a small enterprise software player, the best customers where those who still had skin in the game.

An aside - JIRA was a great product in it's time. It was free to use for any open source project. And many many open source projects willfully chose it, when there was no money involved.

The reason that open source projects chose it (as a cheap bug tracker) and the reason that corporates choose it (as a substitute for understanding what agile really means) are different tho, which is largely my point.

Isn't strategy the answer to the how question? Why is usually called "vision", even though in many cases it amounts to "making money with the tools and knowledge we have."

I define strategy as how you are going to leverage your strengths and overcome your weaknesses (in comparison to competitors) in order to achieve your vision.

From a top down perspective, strategy is a how. As you say, it is how you accomplish your vision. But from a bottom up (implementation) standpoint, it can also be a why. Why are you doing these particular actions? As part of the strategy to accomplish the goal.

A well articulated strategy acts as a linking layer between ultra-high level goals and lower level decisions. We don't expect all actors in a large enough organization to re-derive all of their plans from first principles (nor do we want them to always do that), so a well defined strategy is essentially a pre-determined framework to operate in.

Someone else mentioned Mintzberg, well worth a read. It will shatter many folk theories of what strategy is.

Having said that I'll give a vague answer.

Strategy is consciously deciding on one policy while sacrificing another. If we play a high line, we can't low block around the penalty area. If we press like mad, we can't conserve our energy. If we play the tall guy up front we are committing to crossing the ball, not passing it on the ground.

So basically it's a question of what we're doing and what we are choosing not to do, aka tradeoffs.

The reason things get vague is that we often get mixed up about what is the goal and what is the policy to get there.

So all those things sound tactical to me, they wouldn't persist from game to game or even session to session. You would need to adjust them according to your opposition.

Whereas strategic decisions would be about how you select your players or how you balance players fitness against their freedom to do what they want. Stuff that would transcend individual games or even seasons.

That whole tactics vs strategy thing is IMO a red herring, it's an attempt at creating a distinction where none exists.

You have policies that are exclusive of other policies, sometimes they are quick to change, sometimes they are longer commitments.

Which Mintzberg book(s) would you recommend?

IIRC Strategy Safari.

I think about this topic a lot. I think I am fairly good at tactics: devising the "checklist" and executing on it. I don't know if I am any good at strategy. I haven't tried, and I wouldn't know where the line between tactics and strategy lies.

It doesn't sound like the book being reviewed answers my question. Are there such books? Is it just a matter of "doing" strategy, to know what it is and how to do it well (trial by fire). Or are there books I could read on the subject?

The book is really quite good. The Checklist Manifesto might also be of interest.

The parts of strategy (for some definition of strategy) that are missing from tactics are (1) Diagnosing problems (2) Setting policy. Things like “How do we solve problems” or “How do we find problems” vs “What is the solution to this problem”.

Maybe something more pithy like: “Tactics are what you use to fight on the battlefield, strategy is what gets you there”?

Really appreciate the way you explained this. For some reason it helped me reach a breakthrough on a slide deck narrative I’ve been working on. Thanks for sharing.

I have had similar struggles as you, we can nail rock/OKRs/plans etc... but I always felt like my strategic lens was lacking.

I've read the book and yes, it will answer your question. It shares the theory and does a great job of walking through cases to reinforce the point. Been a founder/CEO for 10 years and this book changed the way I think about strategy.

My favorite part:

Diagnosis - why are we in this mess (define the problem or challenge)?

Guiding policy - what method are we going to use address the challenge?

Coherent action - typical OKR stuff, what do people need to do in what time period?

In previous strat plans I did have some of these elements but this framework helped ensure I was consistently considering the right pieces and was thorough in my analysis.

>between tactics and strategy lies

My two cents.

In business ( And straightly in the sense of business, because the context changes if you apply to War ). I would consider tactics as something that sit between Strategy and Execution. Strategy as direction, or vision and goal. Whether you should enter a specific market, or pursue certain market opportunities. Tactics as steps and moves to achieve that goal. Execution being the actual work.

That is speaking as someone who is annoyed by the media and VCs repetition of "Execution eats Strategy for Breakfast" in the past 10+ years. My hypothesis or theory is that because VCs are already sold to your goal or vision ( strategy ), they just want you to execute it.

I’m asking this only because I’m curious to know what your answer would be, so even if my question persents some pushback to what you wrote, please know it is only my interest go “dig a bit deeper”.

The way you define strategy here “ Strategy as direction, or vision and goal.” is exactly what the linked article (and the book) says strategy is not. I.e. “Strategy is not your goals” and “Strategy is not a vision statement”.

So, assuming you know what you are talking about, thats an interesting juxtaposition. What are your thoughts on the article/book saying vision and goals are not Strategy? (Eg. why do you think it is?)

Sorry I dont have time to write a short, concise and coherent answer which will probably take hours. So I will write a long one :) But take this with a grain of salt. And may likely be controversial / unpopular opinion on HN, as it always has been in the past.

The article mentions it is not a vision statement or goal. Those are true in the example given. Your goal isn't MAU, revenue increase or time on app. Except this is such a low level vision that of course those are not right.

In an abstract division of Strategy and Execution, one can further divide Direction as higher level than Strategy, tactics before execution. So you have Direction > Strategy > Tactics > Execution. As you can see the middle part here is where the it is unclear. Most people only talk about Strategy and Execution, and I think we can, or should all agree if we had to put Direction and vision in the two, they will definitely belong to the Strategy part and not the Execution part.

Lets put an example. Tim Cook's Direction of Apple changed in 2014, in 2015 he announced Apple would be a Services Company, with the Strategy of Product as a Services and Doubling Services Revenue by 2020. That is a high level overview in case of iPhone sales stagnation. His job is to align the company as a whole in that direction.

Eddy Cue, in charge of Apple's Services will now have a direction of Doubling Services revenue, his strategy ( as it turns out ) was to bring in Apple TV+, Fitness from Apple Watch, and Apple Music. While pushing for additional increase in in every corner of Services Revenue. ( AppleCare, App Store etc )

Somewhere along the ling you will have managers, And their Direction will be to increase App Store revenue, Strategy will be to things like Apps Store Search Ads, tactics include forcing Sign up on Apps that were previously ignored or exempt etc etc.

At every level the word direction, strategy, tactics means different thing. And not everyone can have an high level overview.

The one thing I learned in twenty plus odd years in society, is that vision and direction is a very rare thing. Most people are very much lost in life. To the point I will say it is a natural born talent. You could give them all the same information. The same "Map". Some could only focus on the middle part, some could only read part of the map at one time. Some could read the whole map but still cant understand it. While some can see the faint hint of area beyond the map. Extrapolate information from and beyond the map. If you focus in a small part of the map, your Strategy will becomes what is listed in the article, MAU or revenue, short term interest. And the word strategy will change from where and how you view the map / situation.

Take a look at Intel, in terms of Strategic mistakes and execution failure in recent years. I commented on those in 2011 long before anyone thought Intel was doomed to fail. And now 98% of people think Intel is going to fail, I think Intel is going to succeed and be competitive within 4-5 years.

The reason why I hate the execution eats strategy for breakfast quote, is because the equation has always been success = Strategy x Execution. Execution has a large variables. It can be from 1 which is dysfunctional to a 100 like a start up. But execution will always be a positive integer. Strategy, despite the range of number may be less than 10, is the only thing in the equation that can have a negative number. You could execute perfectly at 100 but you will still be doomed to failure if your strategy has a negative number.

Some ( or nearly all )people tends disagree with this take. It was only in the past 3-4 years I found a rare video from Steve Jobs talking about execution and strategy when he retuned to Apple with the exact same take. People were saying Apple had execution problem in the 90s. When in fact they had a Strategy problem. And yet at the time no one see it as such.

My take is that strategy is a set of abstract, high level goals that you specify in order to achieve an objective over a long period of time. Eg, “Create a product for market A in order to build a sufficiently large user/revenue base that will allow us to enter market B”. Think Tesla Roadster, Model S, Model X which then provided enough revenue to build the Model 3.

Tactics are a set of concrete plans and techniques used to achieve each of the strategic goals, in order. “Add these features to the product to make it desirable in market A”. Or, “offer a high volume purchasing commitment to a supplier in order to reduce the cost of batteries”.

You would typically deploy very many tactics over a long time in order to achieve the strategic goals.

The main difference between strategy and tactics is that when (if!) you get to the end of your strategy, you’ve made it; you’ve achieved what you set out to do.

One way to look at strategy could be how do you predict the second order effects. Using a sports metaphor to understand, strategy would be that "Our opponents are ABC, whose strength is D. Our team would go in initially with X plan, looking to tire out or unbalance the opponents/counter D, then at minute 60, they will have to do Y, we will counter that with Z, and we will win."

For 10 min delivery - a potential (although not good) strategy could be, we start with quick commerce delivery eliminating of long wait times and uncertainty in orders, and once the habit is formed and we know the items our customers want (and when they want it), we will predict demand accurately to store only the items they usually need, and we will reduce the cost of excess inventory and the storage needed for it, making it an efficient market.

I really liked this comment from the summary:

> OKR is an strategy-alignment exercise, not a strategy-creation activity.

I think my company has been treating it too much like the latter.

> I think my company has been treating it too much like the latter.

I think that's very common.

HQ idea of strategy "here is your P&L for next year. We need your strategy by Monday".

I can't remember where exactly I read it, but it stuck with me. "In business, strategy is what you are doing that your competitors aren't doing." This struck me as a pretty good and succinct definition.

If you are just doing what your competitors are doing, you have no strategy, which is about right.

For example, Netflix's strategy in its early days against Blockbuster (well documented in the book "7 Powers") was to not charge for late fees and to have awesome web-based movie recommendations. These were two key things they were doing that Blockbuster (and every other DVD rental store) wasn't doing. The "no late fees" thing is a particularly awesome strategy since it "counter-positioned" against Blockbuster's main profit center.

Eventually, Blockbuster copied this strategy, but by then, it was too late, and, Netflix had shifted its own strategy toward, "Build the website from which everyone streams movies, remove the need to physically mail or pick up DVDs altogether." Even today, that strategy has been copied (Hulu, HBOMax, etc.) so their new strategy is, "Develop original Netflix movies/shows and the best overall catalog of movies/shows of licensed content, and have ubiquitous apps that work the same exact way on every device."

As you can see, all of these are strategies... and they are likely ones that opinionated executives like Reed Hastings had a say in. I'm sure many tasks, goals, and so forth for many different teams within Netflix fell out of these strategies at different times.

When a company is missing a strategy, they need opinionated and empowered leadership to shift strategy, sometimes painfully. But, that's not usually easy, especially when the company is historically successful on an old strategy, one which is no longer sound. When Netflix shifted from DVDs to streaming, it meant a lot of layoffs, and I'm sure many long-time professional relationships were soured by the experience.

It's also very hard for individual contributors in a large company to shift the company's strategy. But it's not impossible. Arguably this was the original thinking behind Google "20% time". A project like GMail shifted Google's strategy, but it came out of experimentation by engineers. Easier said than done, though.

Strategy is not tactic. That's is. Strategy is a long term plan, these days nobody accept long term plans, long term in modern neoliberal vocabulary means 6 months, even an year sound too long.

On tactic side things aren't much better: most thing that being sheep might pay well, for success, and in case of failure "...but... It's not my fault! I've done like $name!"...

After WWII élites reason that an ideological society it's risky, at a certain point Citizens might revolt, so better a society of grown children, unable to march on their own foot at all (ideology means marching but just following someone), so we are actually in a society of stereotypical Ford-model workers NOT just at the bottom of the society but almost at any level and as a result nothing can really work.

In the end if you do not know your enemy, where you are, you are just a rabbit in a cage why thinking long term? You just expect some food at regular intervals. Why tactic? All others rabbit are equal to you, getting a bit more or a bit less of food does not change much. No books can really tech, no practice can be of help, a social change is needed, and in absence of strategies and tactics that means just waiting for a disaster. That's "the strategy" and the tactics of modern time for most...

Nitpick: There is a typo in the first three words. Wouldn't ordinarily comment on typos, but it leaves a strange impression right off the bat.

I feel like this post concludes by validating the counterpoints about what it says isn't strategy. Each of these things show self reflection. If self-reflection is what makes for good strategy, then these are certainly trying to take steps in the right direction.

A vision statement is the product of reflecting on who are we. Checklists and templates are products of reflecting on how we do things. Goals are a product of reflecting on who we think we could be tomorrow.

If I were to venture out, a lot of these things are part of a good strategy. And yes, if you set bad goals or have bad checklists or have a bad vision statement, it might just be that the self-reflection was poor. Imagine if Airbus made a checklist of “[X] Don’t let the plane crash into the ground”, probably not rooted in deep reflection.

The book they reference is quite good, though.

> If I were to venture out, a lot of these things are part of a good strategy.

Bingo!

Strategy cannot exist without establishing the destination and stating the destination is useless without specifying how one intends to get there.

He missed one: Strategy is not tactics.

For example I see sports pundits do confuse strategy with tactics all the time. I guess you need to be a chess/go player to really understand these concepts.

> I guess you need to be a chess/go player to really understand these concepts.

How did you reach this conclusion?

Differentiating between tactics and strategy illustrates different levels and priorities in the overall game plan. It might still be valid to use these words interchangeably at some level.

For example; how to set up an ambush is a tactical question, but when and why might be strategic questions. Tact is near synonymous with "how to act".

Yes. It might even be that what is tactical on one level is strategical on another. For example: an investment agency might have as a strategy: "we do arbitrage on different markets that have latency between them". A tactic might be: "We use AI to optimize our decisions". On for the people involved with the AI, the decision of AI is strategical, and the tactics are like "do we use NNs ? or statistical modelling, or both or ... ?"

Another opinion which is less helpful than most others I’ve read. E.g it ends with “..i’m not sure”. Whoa deep.

I've been thinking of a definition of strategy for quite a long time alongside a friend and colleague. We opted for the following: Strategy the link of useful choices which need to be taken to reach a new desirable state starting from the current state.

To me, strategy is a plan of action within a system that dynamically resists your attempts at progress, usually due to the presence of other agents similar to yourself. Chess is a good microcosmic example.

So "strategy" doesn't apply to tasks like going to the moon, curing cancer or getting into shape?

“system that dynamically resists your attempts at progress” applies to all of those in spades, and then some, with a cherry on top!

Competition maybe not to cancer, but to some extent the other two (cold war and competitive fitness - why do you “want” a six pack?)

If going to the moon involves incorporating the reactions of competitors into your plans, then yes. Otherwise I believe the word "method", "plan" or "technique" would suffice. For example, I have always been mystified by the the term "branching strategy" (in the context of source code version control systems). It is just a method, but the word, alas, now feels too pedestrian for most. One at least needs to go with methodology.

Business modeling is about the system that makes your company work.

Strategy is about how your business model / system is going to compete with other players on the market.

In Europe, you're getting a QR code for COVID vaccination. You have to show that QR code at certain locations to be allowed to enter. Usually, you get that QR code printed on an A4-page.

You decide to print that QR code on little plastic cards. You partner with pharmacies (sales channel) and a printing company (production). That's part of a business model.

Now you're realizing that your business model can be copied easily. You realize you've got a first mover advantage and that you've got to aquire pharmacies as fast as possible to defend against competitors. That's a strategy.

If you decide to deliver the first 50 cards per pharmacy for free (trial), that might be a tactic.

The opening sentence contains at least one grammatical error. I can't tell what the article is getting at. Later it devolves into emojis.

strategy is all the stuff that comes between the objective and and its actualization

If all that stuff is strategy, then what are operations and tactics?

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