Strategizing in Relentlessly Changing Markets

Much too often we hear that everything changes so quickly, and that change is accelerating. Change is here; change is constant; change or die, or whatever. I agree, it is actually getting a bit tiresome.

But if you scratch the surface of the latest consultancy white paper, there are actually a few questions we need to sort out in our organizations that have to do with change. But it really doesn’t matter if change is fast, disruptive, revolutionary, or transformative (or feel pick any buzzword on the hype curve). When the external arenas change, to stay relevant, ‘in fit’ with our environment as a strategist would say, organizations need to change as well. And while concurrently developing our future, we need to deliver now. And that is no easy task.

So, how can we ensure success tomorrow while delivering today? Historically, to become competitive and hence successful, it has been enough to focus on economies of scale, customisation, innovation, or brand building – exploiting competitive advantages by being big, best, fast, or beautiful. The real challenge, since the turn of the millennium, is being able to change enough things fast enough, while at the same time getting through the day; and since then, this challenge has been substantially accentuated by the financial crisis in 2008 and the spread of the Corona pandemic in 2020. Now COVID-19 is (probably) ebbing out. So, new external arenas, new internal organizational changes. Again.

Changing much and fast requires clear focus, and that’s where strategy comes into play. These days, strategy must be more about acting and adapting and less about analysing and planning. Organizations need to abandon the prevailing mindset that strategy making is something done by senior management. Strategy and change are so tightly intertwined that both must permeate the entire company.

A good strategy is one that is realized. The realisation of strategy is what determines competitiveness and success, not the planning of it. Involving more people from different levels and functions in strategizing makes it easier to set relevant goals and strategies that more people understand and want to get behind, which considerably improves the likelihood of realisation.

Organizations are populated by people. All of the value created in an organization is created by employee behaviour. Times change. Markets change. People's behaviour changes in every new context. But the laws that govern human behaviour remain constant. We use behaviour that worked in the past.

An organization’s strength in being able to repeat a past success can therefore also become a weakness. Today's truths are at risk of stagnating in the changed landscape of tomorrow. In order to create an innovative climate inclined toward change, organizations need to find ways to question the prevailing norms in the industry, organization or team.

Feedback in all forms drives behaviour. By focusing on behaviour and on reinforcing behaviour that creates actual results, it is possible to create an organization with a climate where employees perform because they want to – not because they have to. A lack of feedback is also a form of feedback. It is all too common for organizations to fail to consciously work to actively reinforce the ‘right’ behaviour. Everything is all right if no one says anything is a common attitude that can easily lead to a punitive culture.

My experience from several hundred organizations tells me that organizations spend far more time on planning, defining, and sending out signals to the organization about what needs to be done than they do on follow-up, analysing reasons to certain results, drawing lessons from this, providing feedback to the organization, and adjusting courses of action. Extensive behavioural research [1] shows that the balance to strike if we want to affect behaviour is the inverse. By completely rethinking the split and dedicating more of our time to follow-up, learning and feedback, we can create an organization that becomes more adaptable to its environment and achieves better results.

Long-term success requires organizations to work with a behaviour focus. By shifting parts of the responsibility for developing the organization onto its employees, we create a willingness on the part of employees to contribute to their organization's future. Encouraging employees to ask questions, to try out new ideas and take certain risks, providing opportunities for them to dedicate some of their working hours to projects in other parts of the organisation and setting up working methods to systematically manage new ideas – that is how we create an organization that harnesses ‘the potential of the entirety’ while improving the chances of identifying new business opportunities and becoming successful in the long term.

[1] See, e.g., B F Skinner (1966) Science and Human Behavior, The Free Press, New York; M Sundel and S Sundel (1999) Behavior Change in the Human Services: An introduction to principles and applications, 4th edn, SAGE Publications, London; B Sulzer-Azaroff and G Meyer (1991) Behaviour Analysis for Lasting Change, Wadsworth/Thomson Learning, Belmont