Bad Strategy

Developing a bad strategy is often worse than simply throwing the dice.

In a recent blog post, Sharad Gupta offered his perspective on four signs that may indicate a bad strategy, namely:

  • Failure to define the key challenge
  • Goals are considered strategy
  • Bad strategic objectives
  • Lots of complex words

While these four are certainly valid, and can be seen time and time again in the strategic plans of even the largest and most powerful businesses, I would add to these with the following:

  • Failure to embed good strategy governance
  • Incorrect identification of the organisation’s beneficiaries
  • Poor strategic intelligence gathering and the use thereof
  • Failure to develop an effective strategy implementation and management plan
  • Failure to monitor, measure and test the performance of a strategy against its intended impact
  • Failure to adapt a strategy to changing market conditions, or if it is not ‘performing’.

Of these 10 potential signs, I would consider the following three the most important, and even sinister, signs of a bad strategy:

  • Incorrect identification of the organisation’s beneficiaries – how can an organisation hope to develop a strategy that will deliver the outcomes its beneficiaries want if it does not even know who its primary beneficiaries are?
  • Developing poor strategic objectives – how can you possibly develop an effective strategy if the overall objectives, or that which the strategy aims to achieve, are wrong?
  • Failure to adapt to changing market conditions, or if it is not ‘performing’ – are you listening Kodak?

Investors and the financial markets, prospective acquisitors, suppliers and partners can derive a lot of insight about an organisation by considering the elements of its strategy that are in the public domain (as our friends at Future Value would agree), but I would argue that, at a minimum, interested parties should look to make sure that the organisation has identified its beneficiaries correctly, that it does have good strategic objectives, and that it has a proven focus on assessing the performance of its strategy.

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One Response to Signs of a Bad Strategy

  1. […] a recent blog post, we talked about the signs of a bad strategy. One of the worst signs is the development of poor strategic objectives. How can you possibly […]