Strategic Thinking Skills
See Also: Risk ManagementStrategic thinking is often looked upon as something that only certain people can do. Somehow, the idea of ‘strategy’ and ‘strategic thinking’ has developed a mystic aura. The other side of the coin is that everyone who has leadership aspirations includes ‘strategic thinking skills’ on their CV and LinkedIn profile.
But what does 'strategic thinking' really mean, and how can you develop strategic thinking skills?
What is Strategy?
In a military sense, ‘strategy’ is defined by Chambers Dictionary as ‘generalship, or the art of conducting a campaign and manoeuvring an army’.
Tactics is defined as ‘the art of manoeuvring in the presence of the enemy’.
In a business sense, strategy has therefore come to mean the long-term vision for the future, and how you plan to get there, with tactics being what you do on a day-to-day basis that supports your strategy, and particularly how you deal with problems.
Strategy, in its simplest sense, is deciding where you want to be and how you’re going to get there, and then taking the action necessary to do so.
So what do you need to do to develop a strategy?
- It sounds obvious but, as a first step, you need to know where you are now. Everything that you do starts from your current position. Even the Grand Old Duke of York, whose skill in manoeuvring has gone down in history, or at least nursery rhyme, couldn’t move downhill until he had first moved up. So gather as much information as you can about where you really are, and don’t accept anecdote as truth. Demand evidence.
- Next, identify the ideal future position at a particular point in time. This could be in five years, ten years or one year’s time, depending on the situation. There are lots of tools out there for doing this in workshops, including visualisation, drawing pictures, ‘blue sky’ thinking and so on, but you can also just spend time thinking about it. It’s important to aim high at this stage, but also to be as detailed as possible. The more detail you can include, the more you know what you want, which is true as much at home as at work. Don’t forget to include things that you really don’t want, as well as what you do want! Do write or draw, as it’s much more concrete on paper.
- Now, from your ideal future position, think about what is really important to you or the company. Where do you or it really need to be? This is about prioritisation. Pare your essential position down to the bones, so that you are really clear what is crucial. Highlight the top three issues or elements, then the top five. Identify any details which really don’t matter. This is why you needed lots of detail at the last step: you can now pick out which details are really important.
- Now it’s time to work out the intermediate milestones from ‘now’ to ‘then’. Now you know where you need to be in five years’ time, where would you need to be in one, two, or three years in order to get there? Concentrate on ‘milestones’ rather than ‘actions’, that is, things you will have achieved, rather than what you’re going to do in practical terms.
- Finally, it’s time to work out actions: what you need to do to get from ‘now’ to your first intermediate milestone, then from there to the next and so on.
Congratulations, you have just completed a strategic plan!
The ‘Miracle Box’
By way of a warning, the world is littered with strategies and project plans that have a large gap in the middle, which is sometimes called the ‘miracle box’, as in, ‘in this space/time, a miracle will happen that will move us from where we are to where we need to be’.
The key issue when developing a strategy is not to fall into this trap.
How? One way is to draw yourself a project map, also known as causal diagrams, or causal maps.
Drawing a Causal Diagram
- Identify all your desired outcomes and put them in boxes down the right hand side of your page or whiteboard.
- Identify all your planned inputs and put them in boxes down the left hand side of your page.
- Now identify who is going to do what with your planned inputs (in other words, your planned processes), and draw those in boxes in the middle. Connect these processes to the inputs that drive them, using arrows.
- Do your processes lead logically to your outcomes? If so, draw an arrow connecting your process to your outcome. If not, you need to add more processes between the current processes and the outcomes until they flow logically.
- Do all your inputs lead logically through actions to outcomes? And do all your outcomes emerge from processes and inputs in a sensible way? If so, well done, you have avoided the ‘miracle box’. If not, have another look…
A causal diagram is useful because it gives you a very clear and visual record of whether your inputs lead to your desired outcomes, and makes it easy to see whether what you’re doing will have the desired effect. It’s a useful exercise to do with a group in planning, because the result is clear and unambiguous to all, and means that suitable actions can then be agreed with everyone concerned.
See also: Project Management
The Final Element to Strategic Thinking:
Keeping your Strategy on Track
Having a strategy is all very well. Achieving it is quite another issue.
This is what really marks good strategic thinkers out from others: everything that they do contributes to their strategy, or at least does not actively work against it.
Before they make a decision, they consider how the possible outcomes fit into their overall strategy. If it doesn’t fit, they don’t do it! And if they really want to do it, and it doesn’t fit with their strategy, they review their strategy to see if it’s still appropriate.
It’s worth taking a bit of time every so often, perhaps once every six months to a year, to review your strategy, and make sure it’s still right for you or the company, and also that what you are doing is contributing to your strategy.
A company away-day is a good opportunity to do this, although many companies use board meetings as a regular chance to review strategy.
At home it can be harder to find the time, but it’s still worthwhile. Sit down with a cup of tea or coffee, and just look at where you wanted to be, and how you thought you’d get there. Is it all still valid, or do you need to tweak it a bit in view of changes to your life? And what difference does that make to what you’re doing every day?
Regular updating keeps it fresh in your mind, and shows that you’re still committed to the overall picture, which makes it easier to make any changes in your day-to-day life needed to achieve your goals.
Further Reading from Skills You Need
The Skills You Need Guide to Business Strategy and Analysis
Based on our popular management and analysis content the Skills You Need Guide to Business Strategy and Analysis is a straightforward and practical guide to business analysis.
This eBook is designed to give you the skills to help you understand your business, your market and your competitors.
It will help you understand why business analysis is important for strategy—and then enable you to use analytical tools effectively to position your business.
Conclusion
Hopefully, you will now understand that strategic thinking is not a ‘mystic art’, but a logical process that stems from knowing where you are and where you want to be, and thinking about how to move from one to the other.
Strategic thinking is an essential part of keeping yourself on track, whether in life or in business, and well worth spending a bit of time on every now and then.