After a few days of marking exams, I have come to realize that most people don’t seem to know the difference between an issue, strategy, objective and tactics. So here is a primer on the nature of business strategy.
An issue or opportunity is determined through your analysis. An issue is either related to a weakness in the resources available to your organization, or a threat from the external environment for which you are not currently prepared. An opportunity is related to a strength in your organization that is currently not being leveraged, or a situation in the external environment that creates an opportunity which your competition is not pursuing.
A strategy is the set of choices that you make to invest your money, time and focus. It typically excludes other choices, and is focused at a high level. Usually a strategy is difficult to reverse.
An objective is the anticipated outcome of a strategy. It is measurable and usually has a time frame.
Tactics are the series of actions you plan to take to achieve your strategy. They are smaller, can be reversed and have less long-term implications than the overall strategy.
Here is an example of an issue/opp, strategy, objective and tactics.
Over 50% of executives in the municipal government sector in Ontario will be retiring in the next five years, leaving many municipal governments with unprepared leadership during a highly challenging period.
- Identify and develop high potential internal candidates to ensure a smooth succession over the next five years.
- Recruit the next generation of leaders to back fill lower positions.
- Ensure 100% of all executive positions are filled internally.
- Ensure that the organization achieves its long-term strategic objectives while undergoing leadership succession.
- Ensure that vacant positions due to promotions are filled with potential future leaders, as measured by leadership competencies and 80% retention rates.
- Identify leadership and knowledge competencies needed for each senior executive position.
- Identify current skills, knowledge and leadership competencies and evaluate the gap between current and needed.
- Identify current high potential candidates.
- Conduct evaluation of Hi Po skills, knowledge and competencies.
- Create leadership development plan for all high potential candidates.
- Identify organizational practices needed to support development, including formal performance evaluation, development programs, recruiting, retention and succession planning.
- Create a “coaching” culture.
- Identify development or “stretch” assignments for each hi po.
- Identify long-term competencies for hiring entry and middle level employees.
Okay, you get my point. So why does this matter? It matters because the choices that we make at a strategic level have a major impact on tactical choices. Often we jump right to tactics, without understanding the implications of our strategic choices. In my example above, my strategy makes a clear choice to focus on internal development of leaders, rather than look externally for leaders. That informed the tactics that I selected. If I had chosen to look externally for leaders, I would have had a much different set of tactics. But if we jump straight to tactics, the strategy is assumed. It is at the level of strategy that we need to have the debate about our direction.
By confusing strategy and tactics, we miss an opportunity to have a real debate about the direction the organization will take to address the issue or opportunity, and perhaps, to avoid a serious mistake. So embrace the strategic debate.