Strategic thinking has become a career-building skill in the business world. It is often mentioned in job profiles for management positions, tends to be included in performance evaluations at all managerial levels, and is highly appreciated in the boardroom. During a time when artificial intelligence and big data are so prevalent, it has become a human skill that is difficult to replace. Many experts agree that anyone can acquire the ability to think strategically, and that this skill can also be developed inside organizations. The question is how to do it.
What It Is
First, it is useful to dispel the myths that strategic thinking is synonymous with foresight and correct prediction of the future, or that it involves a high degree of sophistication and mental complexity reserved only for the few who make it to senior management positions and have earned the right to spend remunerated time philosophizing about business. On the contrary, strategic thinking is present and necessary at every level of any organization. Because survival instincts are one of its key components, strategic thinking is highly democratic, and one of its worst enemies is suffered by all: the dullness of everyday routines that distract from and hamper its operation.
When we talk about strategy in a business context, we refer to making choices and being able to compete in a sustainable way. In his book Good Strategy, Bad Strategy, Richard Rumelt notes that “the core of strategy work is discovering the critical factors in a situation, and designing a way of coordinating and focusing actions to deal with those factors.” Therefore, strategic thinking is thinking with strategy—employing orderly reflection for better decision-making to ensure a company’s future viability.
This capacity for reflection involves the ability to:
• Craft clear goals.
• Identify possible routes for reaching those goals, along with the necessary resources to achieve them.
• Analyze the interactions between the variables for each alternative.
• Understand the ways in which each planned action will draw us closer to the goals.
• Assess the risks and possible collateral consequences, plus the intended results in every possible scenario.
Henry Mintzberg (HBR, 1994) proposed that the most successful strategies are visions and not plans, suggesting that strategic thinking is closer to synthesis than analysis with the connection of points arising from information and experience and their meaning as a unit. Analysis, on the other hand, seeks merely to identify such points. This is the reason why, in the processes of thinking strategically, management experience, intuition, and instincts are complementary to the rationality, academic knowledge, and robust information analyses that might be required. In terms of information, for example, strategic thinking means understanding which pieces we need to seek, analyze, and structure in order to make a decision. Furthermore, it means laying out options even if our information is incomplete, living harmoniously with uncertainty, visualizing possible paths in order to imagine likely results, and anticipating reactions and consequences in a logical and educated manner.
Developing Strategic Thinking
Developing strategic thinking skills on a personal level requires curiosity and risk-taking. As Nina Bowman has stated (HBR, 2016), questions are the language of strategy. Acting strategically involves being a critical observer who asks, listens, and dares to observe from different angles in order to become aware of surroundings and other people´s views. Likewise, stepping away from your own circle of influence to see the forest rather than the trees, and to detect patterns and cause-effect relationships, is critical in transcending tactical thinking. Thinking strategically requires a certain irreverence and uneasiness with the present, confidence in the malleability of the future, willingness to imagine from a wider perspective, and the ability to embrace the risks of uncertainty.
Robert Kabacoff (HBR, 2014) has suggested that developing strategic thinking skills at the organizational level requires that members are provided with clear information about the chosen strategy so that each person understands how daily tasks relate to its execution. Members must be fed strategic information about what is happening within and outside of the business, as ammunition to promote thinking with— and from— the strategy. The organization also needs to design spaces for strategic thinking, for example, by providing mentors for those who show high potential, and by educating leaders at different levels about the concepts and tools of strategy. The latter will sharpen their ability to observe and analyze, thus improving their contribution to the formulation and execution of the chosen strategic path. A strategic collective vision that is far-reaching and long term opens the door to imagination—the wonderful human ability to simulate the consequences of present decisions. Imagination is the foundation of strategic thinking, giving birth to hypotheses and seeing the future as a collection of possibilities.
Always keep in mind that boosting the capacity for strategic thinking requires that people and organizations take the time to reflect. Thinking is also true work.
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