Strategy for fast-changing chaotic environments
When the world is in chaos and business conditions are changing rapidly and unpredictably, conventional strategic planning processes no longer seem to work. However, instead of abandoning strategy, we need it more than ever, and we need to build strategic shock absorbers into our planning processes, according to Jeffrey Sampler in his book Bringing Strategy Back: How Strategic Shock Absorbers Make Planning Relevant in a World of Constant Change.
The book outlines four strategic shock absorbers:
- Accuracy, including decision triggers, which minimise the time required to react, and the strategic wedge, which opens up new opportunities
- Agility, which includes creating a positive bottleneck to funnel information to the right places, and making strategy a bottom-up process
- Momentum, involving focusing on the end rather than the means, and having intellectual buffers rather than physical buffers to build up intangible advantages leading to better decision making
- Foresight, including identifying strategic assumptions and monitoring them to ensure they remain accurate, and systematising alternative strategies so that the company is ready to move at the right time
Interestingly, the companies used in the book as examples are companies from India and Dubai. According to the author, the business environment in these countries has been chaotic with a high rate of change, so companies located in Western countries should look to them for lessons in how to survive and thrive.
The book will probably appeal more to strategy enthusiasts than to typical business managers. In my opinion, the author has some interesting and useful ideas, but there is room for argument as to the extent to which they should be applied in any particular organisation.