I still care very deeply about the role of strategy in associations, and I think it's an area that needs some real work. So I will post now and again as I encounter articles or work that generates insights about the topic.

For example, Cynthia Montgomery has an article in the January HBR that lays out what is now the "new" conventional wisdom about strategy: it doesn't take the form of an unchanging plan, rather it is an "organic process that is adaptive, holistic, and open-ended."

I agree with that, but she also seems to over-emphasize the role of the CEO in my opinion:

The need to create and re-create reasons for a company's continued existence sets the strategist apart from every other individual in the company. He or she must keep one eye on how the company is currently adding value and the other eye on changes, both inside and outside the company, that either threaten its position or present some new opportunity for adding value. Guiding this never-ending process, bringing perspective to the midst of action and purpose to the flow—not solving the strategy puzzle once—is the crowing responsibility of the CEO.

I think laying that kind of responsibility on the CEO is what generated the overly analytical, predictive style of strategic planning that she criticizes: since everything is on your shoulders, you'd better be able to show exactly how it will play out, and then you can control everything. The world doesn't work that way. I wish her article talked more about how you empower the whole system to be focusing on value. Forget the "crowning" responsibility—just empower the system to do what it needs to do.

Notter and De Cagna’s approach to strategy, at least as far as I understand it, is a much more iterative approach than has been used traditionally by associations or most other organizations. For organizations that want to successfully embrace social media, an iterative approach is essential. Start with a clear set of strategic assumptions and a commitment to learn, dive in and experiment with the social media tactics that seem to make most sense strategically, and then adapt strategy, tactics, or both as needed.

(I know--easy to write, much harder to do)

Amen, Jeff, except that I disagree with the last line. Okay, most things worth doing are easier said than done, but I don't think doing what you are saying is as hard to do as people think it is, particularly among associations.

That's why I have been trying to broaden what our "approach to strategy" is, because I think where associations get derailed is in where strategy and implementation overlap. They typically have not designed their organizations in ways that empower the kind of experimenting and (most importantly) learning you are talking about. My last post about the "empowered association" talks about that.

You will have to make changes in processes, roles, expectations, etc. if you want to have your people both run with new ideas AND tie the results back into ongoing conversations about strategy. But once you make those shifts, I think it's actually pretty easy to do. When people are not limited by the way things have always been done, I think you'll be surprised at how willing and able they are to have experiments and better learning conversations as part of strategy development and execution.

I am now thinking that perhaps the whole dead/alive debate is more part of the problem than the solution. The following is a brief piece I wrote as part of the book that Jeff and I are working on. As such, it's not written in typical blog style. It's also longer than most blog posts, so you may have to click through to read the whole thing.

The association community has been actively debating the value of strategic planning over the last few years. Although it is still heralded as a best practice among many association executives, it has also been mocked on a regular basis at the major association conferences, and there are many (including the two of us) who have pronounced strategic planning dead. This defiant proclamation, however, only spurred the creation of "new and improved" strategic planning processes with shorter plan documents, more frequent revisions, and broader stakeholder participation, among other improvements. In 2005, we advocated abandoning strategic planning in favor of building capacity for improved strategic thinking, strategic conversations, and strategic action. The concept garnered some interest back then, but when we make that argument today, conventional wisdom responds with "But that is what we do in our strategic planning."

We now realize that we made a mistake. When we started engaging in a conversation about strategy in the association community, we centered the discussion on whether or not to use strategic planning. We saw (and still see) fatal flaws in strategic planning processes, so we set out to explore alternatives—both through ongoing conversations in the association community and through strategy consulting projects with association clients. We went into our work assuming that we would be able to demonstrate a viable alternative to strategic planning. What we discovered, however, was something different, and it really isn't about strategic planning. We discovered what it takes to create a truly empowered association.

That is what we should have been debating all along—making associations more powerful. This goes beyond whether or not you use strategic planning, or even how you design your strategy process. Both strategy questions and process questions are relevant, but they are not central. Through our work we discovered the more central question:

How do you build an organization that has the power to continuously create new value within a changing environment?

That is the simplest expression of the power we are talking about in the empowered association. Being able to continuously create new value within a changing environment will drive the success of any association. While this may seem somewhat obvious, it is still unfortunately rare in the association community. As we discovered when we started engaging in this debate, most associations focus on the process. They end up choosing a strategy making process that they believe will enable them to adapt to their changing environment. Unfortunately, the strategy making process does not encapsulate the organization’s power to create value. New strategy processes might make incremental improvements, but they rarely enable the association to truly reach its potential.

The process question becomes completely transformed, however, when you look more carefully at how to build a more empowered organization. Empowered organizations certainly understand strategy, but the power extends far beyond process. It reaches into structure, behavior and culture—it can even have you rethinking your job descriptions. It is about clarity and discipline. It is about your entry-level worker, your Board leader, and everyone in between. Debating the merits of strategic planning has distracted us from a fuller exploration of the power that drives associations' success.

So we are changing the conversation. Put aside the questions you have about your strategy process and focus instead on why your association lacks power. Here are some questions to get you started:

At what level in your organization does creative thinking about the future break down? How deeply does (fill in the blank here: board, staff, volunteers, committees, senior management team…) understand the true drivers of success for your association? How do you balance operational details and strategic direction? Are your Board meetings truly worth the time, effort and expense? What blinders does your organizational culture place on your people? How engaged are your staff? How engaged are your members? Why? Can everyone—from memory—tell you what the association's priorities are? Why can't your staff react to major shifts in your industry? Do your meetings people and your government relations people talk to each other? What did you learn from your activities last year? How do your entry-level staff lead the organization? What kind of experiments have you run in the last year?

These are just some of the questions that will reveal how powerful your association is—or isn't. And if you answer these questions and realize you need to make your association more powerful, I guarantee that there is not a strategic planning process on the face of the earth that will turn things around. Don't ignore strategy, of course. Those questions clearly illustrate the importance of the way you do the work of strategy, but if you really want to change things—if you want an empowered association—you need a different framework. You need an approach that will allow you to change ALL of the things that will generate more power, not just your annual strategy process.

The book Jeff and I are writing will provide that framework.

What do you think?

Jeff and I have used the concepts in Blue Ocean Strategy in our strategy work as well, and I am encouraged to see more association executives adopting the ideas.

I've reviewed the book here, but the basic premise of the book is that organizations who can figure out how to change the rules of the game will be able to find "blue oceans" where they are effectively without competitors ("oceans" with lots of competitors become "red" from the feeding frenzy. I know, it's kind of gross.).

What is required is a new and clearer view of what will drive success. This allowed Southwest Airlines to become the biggest in the world while other major airlines languished—they defined themselves as a mass transportation company. They decided not to compete with other airlines, but with your car.

The article in Forum talks about the challenge of doing the same thing in a membership organization for plastic surgeons. They, too, are struggling with clarity about what will really drive success—shifting from being the most skilled, to forging lifetime relationships of care.

That kind of clarity is rare, and I agree that the concepts in Blue Ocean Strategy can help leadership groups think differently about it. It’s that "middle level thinking" I keep talking about. It led the Plastic Surgeons to create a "strategic positioning statement." Pomerantz notes:

This statement, in our opinion, differs from a vision or mission statement, which in many respects are primarily inspirational. A positioning statement tells our members, staff, and the public about who we are and what makes us unique.

Your strategy and culture are joined at the hip: Lets face it, your culture has a big influence on how your company does things. This influence certainly extends to your strategy. Just think about different generic strategies: cost leadership, differentiation, fast follower, … Each of these require a different set of cultural characteristics to be successful. Along the same lines, for any change in your strategy, you will need to identify the cultural behaviors that need to be changed and managed.

Strategy is jointed at the hip of other things too: structure and leadership just to name two. So how is it possible to have a stand-alone strategy making process that does not tie into these other things?

The good news is, unlike Windows, you can create your own strategic operating system. And when you build it correctly, you simply don’t need the patch. Really. In the new operating system, strategy doesn't happen the way it used to. You don't need a new version of strategic planning (the patch), you need to change the way you run your organization so your people are empowered to be strategic.

Donald Sull has an article in MIT’s Sloan Management Review that makes some of the exact points Jeff and I have been making. He begins his article with a refutation of strategy as a linear process. If you think of it as linear (create strategy, then implement strategy, then evaluate what worked), you end up saddled with huge limitations. For example, it’s hard to let new or contradictory information in mid-process, and commitment to plans can escalate quickly (and dangerously). Most managers, he argues, work around these limitations by adopting an interesting management philosophy: make your best guess, and place your bets.

Sull argues (and I agree) that there is an alternative. Strategy should be considered an iterative loop, rather than a straight line. The loop, quite simply, includes four pieces: make sense of your situation, make choices about what to do (and not do), make those things happen, and then make revisions based on new information. Jeff and I tend to frame it a bit differently, although we agree with Sull’s basic premise. What I really liked in the article, though, was Sull’s emphasis that this different approach to strategy making needed to exist throughout the organization:

These steps can be embedded within formal processes, such as strategic planning [noooo!--jn], budgeting, resource allocation, or performance management, but they should also be contained within the myriad informal conversations that fill out the typical managers’ day. And these discussions should not be concentrated at the top; they must take place at every level of the organization. Strategy will remain stranded in the executive suites unless teams throughout the organization can effectively translate broad corporate objectives into concrete action by making sense of their local circumstances, making choices on how best to proceed, making things happen on the ground and making revision in light of recent events.

Incorporating this concept throughout the organization is the key. Strategy has to live everywhere. It’s everyone’s job. But you can’t just announce that to your people in a memo. You have to actually look at the way you run things in your organization to ensure that everyone, at every level, has the capacity to do the work of strategy.

As I am sure all readers of this blog know, Jeff and I have been arguing in favor of “dead” for several years now. And (to repeat) this is not because we think strategy is unimportant. In fact, it is the importance of strategy that motivates us to spread the word of strategic planning’s death. As I mentioned recently, I think the process of strategic planning tends to generate weak strategy—that’s why it SHOULD die!

So we started our attempt to change the conversation with an article in Executive Update two years ago that talked about strategic capacity—the organizational capacity for strategic thinking, strategic conversations, and strategic action.

Meyer and Frankel’s article says some similar things—they stress the importance of strategic thinking, and they state (as many now are) that TRADITIONAL strategic planning is dead (emphasis on traditional). This is the most common argument I’m hearing now. “The way we USED TO do strategic planning is definitely bad, but our new and improved version really is great.”

I’m not convinced.

So what does the new and improved version look like? In the article, Meyer and Frankel suggest that boards need to be doing more strategic thinking. This will require changing what they focus on during board meetings (more on strategy, less on oversight). They must link strategy and budget. They must make sure the organization has the capacity to deliver on its plan. The strategy should be based on data, and you should measure it, and you should partner with others to get it done.

That sounds familiar. We have been telling our boards to do these things forever. I completely agree that boards need to do these things, and I definitely think they need to develop their capacity for strategic thinking, but I strongly disagree that telling them to do this will transform those plans that are gathering dust into “living and breathing” documents as Meyer and Frankel argue.

In fact, the goal of turning a strategic plan into a living document crystallizes the problem for me. Strategic planning is all about the plan! We need a better plan. The plan must be a living document. No!

What about the strategy?! Think about it for a minute. All organizations need a clear strategy. They need to have a shared understanding of what will drive their success and where they should invest resources in order to create the most/best value for stakeholders. This is certainly about anticipating the future, but not about predicting it. What strategy does for you is provide a guide—something that will help you in the future when you are faced with important, strategic decisions. Without a strategy you will simply act randomly in those situations, or (more common) you will fall back on what you had done previously (don’t get me started on “We’ve always done it that way”). Remember, the strategy has to be a dynamic guide because you don’t yet know what specific, key strategic decisions you will face in the future (if you already knew the future, then you wouldn’t need a strategy, would you? You’d just need instructions).

Strategic plans cannot provide that dynamic guide (no matter how much strategic thinking your board does) because they are mapped out down to activities and tasks.

Strategic plans are not guides; they are instruction manuals.

Instruction manuals work for simple problems (where the future is predictable, everyone sees things the same, and cause and effect is clear), but they do not work for complex ones, like running an association. For that you need a strategy. A clear guide. A clear direction. More specific than your mission, but less detailed than your operational plan. It’s the strategy that needs to be living and breathing, not the document.

You can also have plans, of course. I have no problem with groups of people figuring out exactly what they are going to do between now and X in order to support the strategy. Plan to your heart’s content, and be sure to feed back any learning you get while implementing your work into ongoing conversations about strategy. But the plan is secondary to the strategy (that’s why it is dangerous to bolt your plan to your strategy, as strategic planning does). When the world throws you a curveball (and you know it will, you just don’t know how or when), you use your strategy to guide your reaction, not your plan. Once you determine your reaction to the strategic issue, then you figure out what you need to do about the existing plan(s).

Sorry for such a long post! Can you tell I think this is important? Here’s the bottom line: we are losing sight of what really good strategy looks like, and strategic planning is a big part of the problem. Strategic planning actually makes it harder to develop effective strategy, because strategic planning confuses the work of strategy and the work of planning. Yes, we need to develop our boards’ strategic capacity, but we must go far beyond that. We need a better way of developing and modifying strategy (all the time, not just once a year!) and then ensuring that planning, budgeting, and implementation flow from that strategy. Let me rephrase that: we need better organizations that have the capacity to do the real work of strategy.

This will require abandoning the mindset of strategic planning. It will require change in the way you’ve always done things. It might require substantial change to longstanding organizational processes, structures, and even culture. But the payoff is huge.

Dynamic complexity has to do with how clear and quick the cause/effect relationships are. Is the link clear and is the result quick? Or is it more of a long-term, fuzzy, systemic thing?

Generative complexity is about the predictability of the future. In some systems the past is a good predictor of the future (although for most organizations, I don’t think this is true).

Social complexity has to do with the level of shared assumptions and perspectives of the people in the system.

These three types of complexity can be applied to understanding the title of his book: “tough problems.” Tough problems are high on those three scales, and they can’t be solved using methods that we use to solve easy problems.

Simple problems, with low complexity, can be solved perfectly well—efficiently and effectively—using processes that are piecemeal, backward looking, and authoritarian. By contrast, highly complex problems can only be solved using processes that are systemic, emergent, and participatory.

So, here’s the rub: your association’s strategy is a complex problem. The way you do strategic planning is probably piecemeal, backward looking, and authoritarian. Using the same process, but trying harder this time, isn’t going to cut it. And "systemic, emergent, and participatory" are not just buzz words. It really is a new way of doing the work of strategy.

One of the questions I want to explore is: why is growth so important? Why does your budget have to grow? Why does your membership need to grow?

That first question doesn’t belong with the other two. The first one is bigger, and not really about measurement (like the other two are). Growth is important, because the opposite is atrophy. Living things grow—not necessarily in size all the time, but they grow, develop, change, evolve. If they don’t, then they die, or at least start to die. Associations, like any organization, are living systems, so they need growth in that sense, and they need it all the time. This is the essence of strategy: how are we going to grow/succeed? Growth (in this big picture sense) is extremely important.

Budget and membership number growth is another story. I agree with Scott that they aren’t ends in themselves. I suppose it’s obvious why we focus on them. In general, growing memberships are associated with growing budgets, and growing budgets, in general, give you more resources to do stuff. This would give you more reach, power, impact, etc.

So it certainly makes sense that we focus on these numbers. But Scott’s point is that there are untested assumptions here. How do you KNOW you are really making a difference with those extra dollars or extra members? From his post:

The distinction is this: I think too many associations get caught up in designing products and services for the purpose of attracting people. It would be better to design those products and services so that they provide meaningful experiences for people. It's a subtle difference, but I think an important one. And pretty much by design, planning and budgeting guarantee the former approach, because inevitably the goals include revenue growth--more people joining, more people buying a book, more people certifying—these are the things we measure.

This is precisely the point we have been trying to make about the dangers of strategic planning. The work of strategy and the work of planning are two different animals. If you try to “fuse” them together (like Strategic Planning does), you invariably end up with the problems Scott is talking about. Yes, your operational planning and measurement need to connect to strategy, but they should connect through feedback and learning, not through a linear strategic plan document. If you connect them in a “fused” way, you invariably end up weakening your strategy (Our strategy is to grow by 3% this year). You take your eyes off of the ball. You stop talking about what will REALLY drive the growth and success of your enterprise. You essentially STOP doing the actual work of strategy.

If you want growth, you need to do the real work of strategy. And, as Scott points out, by its very design, “strategic planning” makes it harder to get there.

This is why we so strongly urge more discipline about the language we use when doing this work. So many people tell us, “It doesn’t matter what you call it. You can still call it strategic planning, you just have to make sure the plan is more flexible, updated more often, involves more people…”

No. It really does matter what you call it, because it starts to set a pattern in people’s brains. When you use certain language, certain behaviors fall into place without you necessarily realizing it. You don’t really see how the planning focus takes your attention away from the work of strategy—until it’s too late.

In Scott’s example, he says don’t measure the number of people you attract, measure whether your products are meaningful to them. Okay, but why? How does providing that meaning generate success for the organization? If you don’t have the answer to that question, then you haven’t done your strategy work! And too many associations haven’t. They don’t have a clear picture of what drives success. This is something that is below your mission, but above your program details. It is that missing “middle level” of thinking that I referred to in the Always Done It That Way book.

If you were clear on what drives organizational growth and success, then you would know WHY providing meaningful experience to members is so important. And of course you would design your products around that—because it works to your strategy! And you would learn how to measure that. You might also have other sets of measurements for tracking operational progress, but you would never lose sight of the strategy, nor would you stop learning from what you are doing. Strategy should drive your planning. Strategy should drive your measurement. Strategy should drive your learning. Strategy should drive your growth. And since we started doing “strategic planning” it has become harder to do this.