Using emergent strategies to lead effectively

What is the role of emergent approaches to strategy formulation and implementation for organisations in the current climate?

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This article is taken from the latest issue of Relocate magazine – the must read for HR, global managers and relocation professionals.
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In times of fast-paced change, global 
leadership requires careful attention to
 strategic goals. Forward planning, however, 
is likely to be undermined by unforeseen 
events. 

Strategy = organisational scope + direction

Strategy concerns the scope and direction that an organisation may take over the long-term. Its purpose is to achieve a competitive advantage in a changing environment through the best use of internal and external resources to maximise the expectations of stakeholders.In essence, strategy is necessary to identify future goals and objectives, and to plan out the approaches needed to achieve them. Strategy involves global leaders making choices, each of which will have intended – but also unintended – consequences. As such, strategic decision-making requires careful attention to the options and the paths to be taken in the future.

What is a classical approach to strategy? How does it work?

Classical approaches to strategy typically use deliberate, planned actions and processes to achieve profit-maximising outcomes. Drawing upon the field of economics, classical strategy formulation usually involves top-down planning based upon a conscious, rationalistic decision-making process, with strategy formulation separated from implementation. This means that top global leaders (such as chief executives) determine strategy, formulating the plans to be enacted, which are then operationalised through policy and practice. Classical approaches to strategy formulation and implementation are premised on the existence of a hierarchical organisational structure, with operational managers responsible for strategy implementation.Spring Issue 2020 out now

Climate change: disrupting the control and command style of strategy

Long-term strategic planning and strategy implementation in the classical style is, of course, subject to organisational and environmental complexities. With rapidly changing internal and external conditions, including flattening organisational hierarchies and changing demands in stakeholder expectations, this control and command style of strategy determination and application is becoming less appropriate. For example, with the increasing scientific knowledge that we see concerning environmental issues such as climate change, classical strategic decision-making might set long-term goals such as carbon neutrality several decades away. Public opinion, however, is leading to stakeholder demands of less environmentally damaging business approaches right now. The pressure to amend strategic approaches to the production, packaging and delivery of goods, for example, is calling for strategic change far sooner than governmental climate targets.

Strategy shaped by social systems

Classical approaches to strategy are thus suggested as giving way to a more systemic approach, whereby strategic goals and processes are increasingly shaped by the social system in which they are embedded. Drawing upon the field of sociology, the systemic approach to strategy reflects the values of societies.Strategy determination remains deliberate, but is driven by pluralism. By using a more systemic strategic approach, organisations can still plan ahead and formulate strategies that are appropriate to particular contexts, but their strategic goals and processes become increasingly shaped by local social and economic systems, and factors such as culture. Hence, global leaders wishing to determine strategic goals and their implementation will acknowledge a range of contextual factors in different societal, political and financial regimes – and strategise accordingly.
More from Dr Sue Shortland:

Evolutionary approaches to strategy: survival of the fittest

As an alternative to the deliberate approach to strategy, organisations might consider using a more emergent approach. The evolutionary strategy, with its backdrop in biology and using Darwinian principles, highlights that market unpredictability militates against heavy investment in strategic plans. The evolutionary approach suggests that the market, not global leaders, secure profit maximisation and determine strategies. If using this approach, leaders will need to keep their options open; the firms that survive will be the fittest and most efficient.In essence, an evolutionary approach will follow the principles of the competitive process of natural selection and the market will dictate strategies to be adopted. If it is accepted that long-term strategising is ineffective, rather than using long-term planning, leaders will experiment with many small initiatives. They will then choose the winning ones and abandon the failures. Of course, it should be recognised that firms must be able to differentiate between courses of action and likely outcomes, and be capable of adapting their goals and approaches to achieving these if their firms are to survive.

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A processual approach to strategy: a continuous and adaptive process

A further emergent strategic approach that global leaders might consider is referred to as processual, whereby the strategy emerges from the day-to-day activities of the firm, rather than being a function of the market. In this approach, which draws upon the field of psychology, strategy is a continuous, formative and adaptive process. It represents a pragmatic response to events in which global leaders continually make compromises and adjustments. This approach acknowledges the limits of human cognition, the imperfections of human behaviours and action, and the realities of organisational life. In recognition that organisations are complex, strategy formulation and implementation become inextricably entwined.Strategies can emerge with much confusion and in small steps; they are often only recognised in action. Strategy may sometimes only be identifiable in hindsight. This approach makes use of the organisation’s core, distinctive competencies, placing these at the heart of a firm’s competitive advantage and sustainability.

"Satisficing" for the greater good

The processual approach also recognises the range of different organisational stakeholder interests and pays attention to the consideration of alternative approaches to address these. As such, strategies may result in ‘satisficing’ behaviours. Satisficing refers to actions taken by global leaders who are unwilling to maximise one goal at the expense of another, but wish to reach a high level in both. In this way, outcomes can become acceptable to a wider range of stakeholders.

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