Strategy (110 page)

David Sally compared what could be learned from experimental games with what might be predicted by game theory. The “explosion of experimental work in the past 20 years,” he wrote in 2003, revealed that human beings, “despite their advantages in the areas of reasoning, rationality and
mentalizing, can be the most befuddling and the least consistent game-players.” At various times they came over as “cooperative, altruistic, competitive, selfish, generous, equitable, spiteful, communicative, distant, similar, mindreading or mindblind as small elements in the game structure or social setting are altered.”
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A lot of responses to events were intuitive, undertaken without much hard thought or analysis of alternatives, and produced judgments that were quick and plausible. Individuals were not natural strategists. It required a conscious effort.

There are no endings. If you think so you are deceived as to their nature
.

They are all beginnings. Here is one
.

—Hilary Mantel

C
HAPTER 1 CONCLUDED
, after a discussion of primates and the more primitive human societies, by identifying some elemental features of strategic behavior. Such behavior emerged out of social structures that invited conflict, recognized the distinctive attributes of potential opponents or allies, displayed sufficient empathy to find ways to influence their actions, and were able to prevail through deception or coalition as well as brute force. These features have regularly come to the fore as we have considered strategy in both theory and practice. We have also come across a number of definitions of strategy, many of which are perfectly serviceable, although none quite capture all these elements. Some have been quite specific to particular spheres, notably the military, referring to engagements, maps, and deployments. Others have been more general, referring to the interaction of ends, ways and means, combinations of long-term goals and courses of action, systems of expediencies and forms of domination, dialectics of opposing wills and interdependent decision-making, relationships to environments, advanced problem-solving, and a means of coping with uncertainty. The preface offered “the art of creating power” as my short definition. This has the advantage of allowing the impact
of strategy to be measured as the difference between the outcome anticipated by reference to the prevailing balance of power and the actual outcome after the application of strategy. It helps explain why underdogs find strategy most challenging. It does not, however, provide guidance for practitioners. To this end this chapter explores the value of considering strategy as a story about power told in the future tense from the perspective of a leading character.

Those who want to be sure that their strategy is well done can draw on many forms of advice, from professional manuals to self-help books to specialist consultancies to academic journals. Some prescriptions are exhortatory while others are more analytical; some struggle to rise above banalities while others are couched in terms barely intelligible to lay readers lacking higher mathematics or the ability to penetrate postmodernist codes. Some insist on a paradigm shift. Others suggest nurturing an inspirational personality or urge close attention to detail. Faced with such diverse and often contradictory advice it is hard to avoid the conclusion that while strategy is undoubtedly a good thing to have, it is also a hard thing to get right. The world of strategy is full of disappointment and frustration, of means not working and ends not reached.

The various strands of literature examined in this book all began confidently with a belief that given the right measures demanding objectives could be achieved on a regular basis. The Napoleonic phenomenon led Jomini and Clausewitz to explain to aspiring generals how they might win decisive battles and so decide the fate of nations. The recollection of the French Revolution and gathering social and political unrest encouraged the first professional revolutionaries to imagine equally decisive insurrections from which new forms of social order would emerge. Over a century later, large American corporations—apparently unassailable and enjoying benign market conditions—were encouraged by Chandler, Drucker, and Sloan to look to strategy as a guide to the organizational structures and long-term plans that could sustain this happy state of affairs.

In all three cases, experience undermined the foundations of this confidence. Victory in battle did not necessarily lead to victory in war. The ruling classes found ways to meet popular demands for political and economic rights that diverted revolutionary pressures. The comfortable position of American manufacturers was rocked by international competition, notably—but not solely—from Japan. Yet these setbacks did not lead to the initial frameworks being abandoned. Military strategists continued to yearn for a route to decisive victories even as they were frustrated by grinding campaigns of attrition or popular resistance and guerrilla ambushes. Revolutionaries continued to seek ways to mobilize the broad masses to overthrow governments even as the Western democracies legitimated expressions of discontent and paths to
reform, and as these encouraged quite different and generally more productive types of political strategy. It was only in the business sphere that the flaws in the early strategic models were so evident that they were soon left behind by a frenetic search for alternatives which came to involve a range of competing, often contradictory, and confusing propositions.

The problems experienced with strategy were a natural consequence of its Enlightenment origins. Progressive rationalism, later identified by Weber as an unstoppable secular trend manifest in the rise of bureaucracies, was expected to squeeze out emotions and romance, thereby removing intrusive sources of error and uncertainty. The prospect was one of human affairs ordered on the basis of accumulated knowledge. But relevant knowledge was hard to accumulate or present with sufficient precision to guide practitioners, who were faced with a series of competing demands and uncertainties and often had little real choice but to “muddle through.”
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The assumption of rationalism, influencing not only the theorizing but expectations of how it would be received and acted upon, turned out to be inadequate.

Strategies were neither designed nor implemented in controlled environments. The longer the sequence of planned moves, the greater the number of human agents who must act in particular ways, the more extensive the ambition of the project, the more likely that something would go wrong. Should the first moves in the planned sequence of events fail to produce the intended effects matters could soon go awry. Situations would become more complex and the actors more numerous and contrary. The chains of causation would become attenuated and then broken altogether. Without going as far as Tolstoy, who dismissed the idea of strategy as presumptuous and naïve, it was evident that successful outcomes would depend on trying to affect a range of institutions, processes, personalities, and perceptions that would often be quite impervious to influence. Warning against the belief that history was full of lessons, Gordon Wood argued that there was but one big one: “Nothing ever works out quite the way its managers intended or expected.” History taught “skepticism about people's ability to manipulate and control purposely their own destinies.”
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Strategies were not so much means of asserting control over situations but ways of coping with situations in which nobody was in total control.

Did this leave strategy with any value? “Plans are worthless,” observed President Eisenhower, drawing on his military experience, “but planning is
everything.”
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The same could be said about strategy. Without some prior deliberation it might be even harder to cope with the unexpected, pick up the cues of a changing situation, challenge set assumptions, or consider the implications of uncharacteristic behavior. If strategy is a fixed plan that set out a reliable path to an eventual goal, then it is likely to be not only disappointing but also counterproductive, conceding the advantage to others with greater flexibility and imagination. Adding flexibility and imagination, however, offers a better chance of keeping pace with a developing situation, regularly re-evaluating risks and opportunities.

A productive approach to strategy requires recognizing its limits. This applies not only to the benefits of strategy but also to its domain. Boundaries are required. As strategy has become so ubiquitous, so that every forward-looking decision might be worthy of the term, it now risks meaninglessness, lacking any truly distinguishing feature. One obvious boundary is to insist on its irrelevance in situations involving inanimate objects or simple tasks. It only really comes into play when elements of conflict are present. Situations in which this conflict is only latent are rarely approached in a truly strategic frame of mind. Rather than assume trouble people prefer instead to trust others with the expectation of being trusted in turn. Within a familiar environment, working with an “in-group,” overtly strategic behavior can lead to resentment and resistance without commensurate gain. People can be at the wrong end of power relationships without either realizing or caring, because of the way they have been encouraged to think about their life circumstances or because of their habitual reluctance to challenge established hierarchies and conventions. What makes the difference, so that strategy comes to the fore, is the recognition of conflict. Some event, or shift in social attitudes or patterns of behavior, can challenge what had previously been taken for granted. Familiar situations may be seen with fresh eyes and those previously part of the “in-group” come to be viewed with suspicion as defectors to the “out-group.”

If emerging situations of conflict bring strategy into the picture, a desire to play down conflict can take it out. This can even be the case with official documents with strategy in the title which are largely designed to demonstrate a capacity for long-term thought. In these documents strategy is packaged as an authoritative forward look, reflecting the approved views of a government or company. Hew Strachan has complained of how strategy has come to be abused in this way, at the expense of its original role as a link between ends and means. By extending strategy into all governmental endeavors the word is “robbed” of its meaning leaving only “banalities” behind.
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Certainly many “strategy” documents deliberately avoid the topic,
lack focus, cover too many dissimilar or only loosely connected issues and themes, address multiple audiences to the satisfaction of none, and reflect nuanced bureaucratic compromises. They are often about issues that might have to be addressed rather than ways of dealing with specific problems. Consequently, their half-lives are often short. To the extent that such documents have any strategic content they are about a broad orientation to the environment, what became known in business strategy as “positioning.” It may well be that in a broadly stable and satisfactory environment, in which goals are being realized with relative ease, there may be little need for anything sharper and bolder. Only at moments of environmental instability, as latent conflict becomes actual, when real choices have to be made does something resembling a true strategy become necessary.

So what turns something that is not quite strategy into strategy is a sense of actual or imminent instability, a changing context that induces a sense of conflict. Strategy therefore starts with an existing state of affairs and only gains meaning by an awareness of how, for better or worse, it could be different. This view is quite different from those that assume strategy must be about reaching some prior objective. It may well be more concerned with coping with some dire crisis or preventing further deterioration in an already stressful situation. So the first requirement might be one of survival. This is why as a practical matter strategy is best understood modestly, as moving to the “next stage” rather than to a definitive and permanent conclusion. The next stage is a place that can be realistically reached from the current stage. That place may not necessarily be better, but it will still be an improvement upon what could have been achieved with a lesser strategy or no strategy at all. It will also be sufficiently stable to be a base from which to prepare to move to the stage after that. This does not mean that it is easy to manage without a view of a desired end state. Without some sense of where the journey should be leading it will be difficult to evaluate alternative outcomes. Like a grandmaster at chess, a gifted strategist will be able to see the future possibilities inherent in the next moves, and think through successive stages. The ability to think ahead is therefore a valuable attribute in a strategist, but the starting point will still be the challenges of the present rather than the promise of the future. With each move from one state of affairs to another, the combination of ends and means will be reappraised. Some means will be discarded and new ones found, while some ends will turn out to be beyond reach even as unexpected opportunities come into view. Even when what had been assumed to be the ultimate goal is reached, strategy will not stop. Victory in a climactic event such as a battle, an insurrection, an election, a sporting final, or a business acquisition
will mean a move to a new and more satisfactory state but not the end of struggle. What has gone before will set the terms for the next set of encounters. The effort required to achieve victory may have left resources depleted. A crushed rebellion may add to the resentment of the oppressed; bruising election campaigns can hamper coalition formation; hostile takeovers make merging two companies more difficult.

One reason why it is so difficult to anticipate how situations might develop over many stages results from the need to address many relationships. Strategy is often presented as being solely about opponents and rivals. In the first instance, however, colleagues and subordinates must agree on the strategy and how it should be implemented. Achieving an internal consensus often requires great strategic skill and must be a priority because of the weaknesses caused by divisions, but the accommodation of different interests and perspectives can result in a compromised product—suboptimal when dealing with a capable opponent. The larger the circle of cooperation required, including third parties who might become allies, the harder it can become to reach agreement. While there can be tensions among supposed friends, there can also be areas of shared interest that provide the basis for a negotiation. Rival states might prefer to avoid all-out war, political parties to maintain standards of civility, and businesses to avoid pushing prices down to unprofitable levels. This interaction between cooperation and conflict is at the heart of all strategy. There is a spectrum marked by complete consensus (absence of any disputes) at one end and complete control (disputes smothered by one party's domination) at the other. Both extremes are rare and almost certainly unstable as circumstances change and new types of interest emerge. In practice, the choice may well be between degrees of conciliation or coercion. As the best way of coping with superior strength is often to put together a coalition or break up that of the opponent, strategy is apt to involve compromises and negotiations. “The pursuit of relative power,” Timothy Crawford has observed, “is as much about subtracting and dividing as about adding and multiplying.” This can require difficult forms of accommodation to keep a party neutral and away from the enemy camp.
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All this explains why strategy is an art and not a science. It comes into play when situations are uncertain, unstable, and thus unpredictable.