05. What Constitutes Strategic Thinking – III
Now that we’ve established the difference between Strategic and Tactical thinking let us revisit the caselets from the earlier lesson. And, based on our understanding of the differences between both thinking patterns we’ll ascertain if the actions mentioned in each caselet are strategic in nature, or otherwise.
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a. Is seeking to understand the specifications of a product
b. Uses a well thought through process to help identify the best possible vendor to supply that product.
Does this constitute strategic thinking?Presenter 2: The admin team is concerning itself with how a set goal or objective can be met, in this case seeking to understand the specifications of a product and then finding a vendor to supply that product. This is tactical thinking. The goal, identifying a new product requirement, has already been set, and the admin team is merely focused on executing it.Presenter 1: Yes, that is tactical thinking, as it is focused on the “how” question.Presenter 2 (Picks up a cue card): Okay, I’d like your views now on the second case. The legal team studies the laws of the land and identifies ways to secure a competitive advantage for the organisation’s products. It then advises management on how they can utilise that law to raise the entry barrier and make it harder for competition to enter the same market.
Is this strategic thinking?Presenter 2: Yes, it is. It answers a “what” question; one that is independent of any defined project goal or objective. Instead, it is focused on proactively helping the organisation navigate towards a specific end; in other words, it concerns itself with setting a goal or the strategic direction for the organisation, in this case, gaining a competitive advantage. That constitutes strategic thinking.Presenter 1: Mmm.. interesting… In this case, the legal team performed this task proactively. However, what if the legal team had been tasked with the job of studying the laws of the land to find ways to secure competitive advantages for the organisation’s products?Presenter 2: Had the strategy, i.e. the need to find ways to secure competitive advantages already been decided by senior management and the task of studying the laws of the land being handed down to the legal team, the legal team’s actions would have constituted tactical thinking. They would be now focussed on the “how question”, i.e. how can we find a way to secure a competitive advantage?
Presenter 1: Yes, this would fulfil the definition of tactical thinking
Presenter 2: Yes, it would.
Okay, your turn now to assess a case.
The senior management decided to change security policies for a particular business unit within the organisation. The Risk Team highlighted how changing the policy in one business unit will upset the delicate balance that exists between business units and the potential fall out this transpiring.
Is this strategic thinking?
Presenter 1: When the question on “how will something that we are contemplating affect the other moving parts in the ecosystem?” has been answered, it depicts strategic thinking like it is in this case. In this case, the Risk team looked at how things changing in one business unit can have a knock-on effect on other business units. This is clearly a case of strategic thinking.
Presenter 2 (To the camera): Did you get that one right? Most people we know don’t.
Presenter 1: Okay, your turn now to play Sherlock: The Compensation and Benefits team, which had been tasked with the job of devising a suitable incentive structure for the business team, conducts an industry benchmarking study and comes with the best incentive plan in the industry.
Presenter 2: How is it that I am getting all the cases on tactical thinking? This is tactical thinking as it is focused on finding a way to best perform a task, i.e. devising a suitable incentive structure.
Presenter 1: What kind of action, in this case, might have constituted strategic thinking?
Presenter 2: Had the Compensation and Benefits team proactively decided to look to identify changing trends in employee compensation and benefits and then steer the organisation’s practices towards ensuring that it is ready for such changes, it would have constituted strategic thinking.
Presenter 1: And what strategic thinking question would that have answered?
Presenter 2: Two, actually; though, both related. Namely, “what does the future look like? And, how do we prepare for this future?”
Presenter 1: Yes, anticipating and preparing for the future is one of the questions that the strategic mind is concerned with.
Presenter 2: Precisely. Okay, here’s the last case: The IT team had been approached by one of the business heads to develop a system that would automate some of the work that they performed manually. The IT team seeks to understand the plan that the business has for itself for the next three years, to identify how the system design can be more comprehensive and future proof.
Presenter 1: This one is a bit tricky. This is Strategic Thinking. Now, the IT team’s intervention was reactive. i.e. they were merely responding to the business head’s request for help with automation. However, the IT team looked to study the organisation’s plans for the next three years to try and create a system that would be future proof. They sought to answer the questions ““what does the future look like? And, how do we prepare for this future?”
That’s strategic thinking.
Presenter 2: Interesting!
Presenter 1: Yes it is.
Presenter 2 (Looks into the camera): Okay, in a nutshell then. Strategic thinking seeks to answer the following questions:
1. What are we trying to achieve here?
Presenter 1:
2. Why are we trying to achieve this goal and not something else?
Presenter 2:
3. What would a well-done job look like?
Presenter 1:
4. How does this interconnect with other moving parts in the ecosystem? What impact can this have on other moving parts in the ecosystem?
Presenter 2:
5. What does the future have in store for us? How can we best prepare for this future?”
Presenter 1: Cultivate the discipline of thinking along these lines, and you would be honing your ability to think strategically.
Presenter 2: The five questions that we have shared with you require you to possess three distinct mindsets. Adopting these mindsets provides you with a what we at CitrusLearning/ Actuate call a Big-Picture Orientation.
Presenter 1: These mindsets, which we will be exploring at length, are the focus of the remainder of this course. But before we go any further, please take the quiz accompanying this lesson.