Assumptions abound!

What  is an enlightened organisation? How could we define such a state of being that delivers ethical and sustained high performance?

An organisation that is aware of its assumptions and continues to explore and uncover new ones – this might well qualify as either a definition or a defining characteristic.

I’ve already written two blogs that reference assumptions significantly – see Leading (meaningful) change and Schools of Strategy. However, some recent experiences have inspired me to add more on this subject – so you have a trilogy on assumptions!

Strategy

I love strategy. I have studied it for 40 years (and continue to do so). I have designed, created and implemented it wherever I have worked (in collaboration with colleagues). So far so normal.

What I want to explore here are observations on strategy as a business process across the UK non-profit world and the role of hidden assumptions, because unexamined assumptions limit effectiveness.

The principal assumptions I have observed are:

• The organisation must have an over-arching strategy (sometimes covering a 10 year time horizon).

• Each function e.g. fundraising, marketing etc, has a departmental strategy and plan that supports implementation of the organisational strategy.

This project planning approach to strategy has its roots in the work of Michael Porter in the 1970s and 1980s – and reliance on this method alone is questionable in today’s world.

These main assumptions are reinforced by five more that accompany this scenario:

1. Strategy emanates from the top; most charities operate from a pyramid/hierarchical management model i.e. a CEO supported by the directors of the main functions (a ‘leadership’ team of circa 5 people).

2. The detailed, linear project plans assume that you can predict and control the future.

3. Strategy is translated into detailed budgets (one year horizon or longer).

4. Strategy is essential to achieve success/impact (however defined), to the point that it is impossible to succeed without a strategy. And it would be considered reckless not to have one.

5. Implementation of the strategy will flow like a river as soon as it is released.

Not much thought is given to the people dimension of strategy i.e. the capabilities and skills of the staff, and their collective ability/bandwidth to deliver the strategy. As the wise Jeffrey Pfeffer points out: “More important than having a strategy is the ability to implement it.” He argues persuasively that the real sources of competitive leverage/advantage is often overlooked – the culture and capabilities of the organisation that derive from how you [lead]/manage your people.

The consequence of this linear, analytical approach is that the leadership team (individually and collectively) tends to stay within the confines of their existing knowledge - reinforcing rather than opening perspectives.

The real kicker, of course, is that none of these assumptions are valid or true – they are all illusions. We now know that organisations can be highly successful without a formal strategy e.g Buurtzorg.

Emergent strategy is just as relevant, if not more so than linear planning. Open strategy has shown that strategy should come from the ‘bottom-up’ (as opposed to top-down) – and this connects with Mintzberg’s views on emergent strategy.

The same organisations that are thriving without linear strategy processes are also doing it without the convoluted budget processes that are still the norm. No strategy and no budgets – it’s amazing what human creativity can produce and make work.

What is also striking is that these progressive organisations invest heavily in people development and skills training.