Gone are the good old days when it was good enough to analyze the market, look at the company’s strengths and weakness, pinpoint the competitive advantages and draft and endlessly redraft a plan. Life used to be so straightforward. But in the New Normal, in this digital age with its fierce competition, this way of working has lost its relevance. You can’t afford to wait for things to crystallize. If you do, the competition will beat you by a mile.

Higher purpose
Modern strategy execution in the New Normal requires a fundamentally different way of working. Nowadays, the equation that works is Strategy = Execution. This doesn’t mean strategy has become irrelevant. But every strategy requires another strategy: an execution strategy. In a column in the Dutch business paper Het Financieele Dagblad, INSEAD professor Annet Aris wrote, “A classic strategy analyzes market developments, looks at a company’s strengths and weaknesses, pinpoints the competitive advantages that can be exploited and based on these steps, devises plans as to where and how that company can grow. The result is a series of very precisely calculated projections for the next 3 to 5 years. More and more academics and even consultants and digital businesses are tossing this classic approach out. They are replacing strategy with a systematic quest for a higher goal, with lots of trial and error and unexpected outcomes, just like Columbus’s sailing expedition to Asia.”

Small can be big
In the new normal, organizations need a solid, but brief strategy executed in short cycles of tight work packages comprising analysis, design, execution and business cases. In other words, small can be big. What does this mean? It means cutting large ambitions or goals up into smaller chunks, which allow you to learn as much as possible as fast as possible. This method is appropriate not only for small incremental changes, but also, and in fact particularly, for renewal and radical innovation. Organizations must make very deliberate choices and balance their strategic goals and execution capacity. And based on this, they need to pare down their portfolio of initiatives (projects, programs, training courses) every year. For more on this topic, see my earlier blog post Purge, select and balance.

Lazy goals
You can’t do without a clear vision, a sharply defined why, and ditto strategy. I regard the setting of vague long-term goals as sheer laziness. And while rigid blueprints may have lost their relevance, planning remains key. Leadership development expert Harry Starren calls this the planning paradox: you need to plan and look ahead, but also be prepared to change tack at the drop of a hat. It’s all about balance. Lucid corporate visions and strategies are still rare, but more and more companies are working on developing a coherent mission and a concrete, inspirational long-term vision and strategy. Which is an entirely different kettle of fish than a vague long-term goal.

Punch above your weight
Strategy expert Richard Rumelt hits the nail on the head in Good Strategy/Bad Strategy when he writes that many organizations have no strategy, even if they think they do. What they call strategy is often no more than a (long) list of performance indicators, or worse yet, a vague wish list. Strategy means tackling challenges head on. The essence of a good strategy is that it outlines the challenge and provides a roadmap, which form the basis for a concrete, coherent action plan. If this sounds rather obvious, be aware that few companies and institutions actually have such strategies. Thinkers like Jim Collins and Hans van der Loo have shown repeatedly that profitability depends on a clear vision. A well-defined vision is what enables a company to punch above its weight. Organizations with a robust and widely supported vision are over 25% more profitable than organizations that lack one.

It is easy to see why strategy execution has fundamentally changed. Figure 1 below shows why modern strategy execution and change management thrive on effectiveness and agility rather than perfectionism.