Historically, strategic planning has been considered the single most important function of the CEO. In her book “The Strategist: Be the Leader Your Business Needs”, Cynthia Montgomery, argues that through the years, many CEOs have outsourced strategy development to consultants and business analysts, armed with frameworks and techniques to help the CEO analyze their industry and position their firm for competitive advantage. They are hired to create the strategy for the CEO and the company. So much so that strategy is no longer a top-of-mind responsibility for many senior executives, but simply an annual exercise. After the consultants finish their work the CEO can say, “Well we did our job, and that’s finished for another year. Now we can get back to work”.
Montgomery maintains that, “Although a company may change what it makes, the services it provides, the markets it serves, and even its core competencies, its continued existence depends on finding and continuing to find a compelling reason for it to exist. Shepherding this never-ending process, being the steward of a living strategy, is the defining responsibility of a leader.”
Montgomery maintains that “strategy has been narrowed to a competitive game plan, separate from a firm's larger sense of purpose. This has led to the eclipse of the leader's unique role as arbiter and steward of strategy."
Professor Montgomery says it's time for CEOs to again become strategists.”
Montgomery explains that leading strategy requires confronting four questions:
- What does my organization bring to the world?
- Does that difference matter?
- Is something about it scarce and difficult to imitate?
- Are we doing today what we need to do in order to matter tomorrow?
For the leader, "becoming a strategist starts with getting clear on why, whether, and to whom your company matters." While that may sound obvious at face value, ask yourself, “Do I have that clarity in my company?”
Montgomery goes on to say that a compelling purpose is just the beginning of a strategy. "It gives you the right to play, and puts you in the game."
Strategists also must lead the charge in creating organizations that can deliver/implement their intentions. That means building a business culture with mutually reinforcing parts. "Strategy must be the animating force in a company. There must be a clear solid link between strategic ideas and action."
Who is a strategist?
Professor Montgomery also stresses the importance of recognizing how a strategist lives and leads. Incorporating the role of the strategist into one's identity is important because leading strategy is not an annual task but a never-ending quest. Shepherding this never-ending process, being the steward of a living strategy, is the defining responsibility of a leader.
A question for you as a leader
You're at the podium addressing a group of new employees. One of them asks about the strategy of the business. You have two minutes to explain. Could you do it?