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The difference between a strategy, emergent or formal, and a plan

Henry Mintzberg, a Canadian professor who studies management, has concluded that only 10 percent of most companies’ actions arise out of their formal strategic planning. Fully 90 percent of the results projected in most formal strategic planning processes never come to fruition. As explained by Willie Pieterson, Reinventing Strategy: Using Strategic Learning to Create & Sustain Breakthrough Performance (John Wiley 2002) at 46, the largest portion of activity comes from “emergent strategy.” This organic, evolutionary progress results from a series of ad-hoc initiatives, reactions, trial and error, and choices that managers make in response to daily pressures, without guidance from any overarching strategic concept. So-called strategy is Topsy, it just grows.

General counsel, and those who report to that position, create large doses of emergent strategy, in part because their range of strategic initiatives are so limited (See my post of Dec. 15, 2005 that doubts law department strategic planning; and Dec. 19, 2005 on active inertia.) .

In Pieterson’s opinion, good strategy begins with divergent thinking, which questions basic premises. Good planning, by contrast, is above all an exercise in convergent thinking, which picks among the given choices the most effective one (id at 46). Both depend on execution (See my post of Oct. 10, 2005 where executive weaknesses undermine strategic decisions.).

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