Strategic Living versus Strategic Planning

Victor Pinedo
President of Corporate Transitions International

Recently a client requested our organization to help them with developing a Strategic Plan for his company. My immediate reaction to this client was: We don't do strategic planning. Strategic planning is OBSOLETE. What we could offer you would be a visioning process, which would allow you and your management team to do some strategic thinking. The client looked at me and asked: "What's the difference? It's all about the company's strategy. Is it not the same thing?"

As I reflected on his question I realized that although both "planning" and "thinking" dealt with strategy, there was a fundamental difference. Upon further reflection, I became aware that we were talking about fundamentally different approaches to the planning process. As a matter of fact, this conversation was really about much more than the strategic planning vs. strategic thinking. We were really talking about a developmental process, which moved from strategic planning to strategic thinking to strategic living to strategic being. Let's define these four concepts, as I understand them.

Strategic Planning

Strategic planning, as defined by Wikipedia, is the process of determining the company's objectives and courses of action, and the allocation of the necessary resources to achieve them. It consists of the process of developing strategies to reach a defined objective. As we label an aspect of planning "strategic" we expect it to operate on the grand scale and to take in "the big picture" (as opposed to "tactical" planning, which by definition has to focus more on the tactics of individual detailed activities). "Long range" planning typically projects current activities and programs into a revised view of the external world, thereby describing results that will most likely occur. "Strategic" planning tries to "create" more desirable future results by (a) influencing the outside world or (b) adapting current programs and actions so as to have more favorable outcomes in the external environment. The focus of strategic planning is on movement from the present to the future. It looks at where the organization is today and plans the future as an extension of the present

Strategic Thinking

This is the process by which an organization envisions its future and develops strategies, goals, objectives and action plans to achieve that future. Contrary to strategic planning, strategic thinking is influenced by the vision of the future the organization wants. We call this Future Pull. It comes from a sense that humans are creators and can create the future state they want. After creating the future vision, the organization will look at each goal, to determine where the organization is vis-�-vis this goal and create the strategies to reach it. In strategic thinking, people see the vision as a tool to develop the future.

Strategic Living

Too often, the strategic thinking process is implemented by an organization in the same way as the strategic planning process. This takes us to our differentiation of strategic living from strategic thinking. In strategic living, members of the organization see their vision as a projection of their purpose and values into the future, and therefore, achieving the vision becomes synonymous with achieving their life goals and their own purpose. Because of this different viewpoint, the members of the organization will look at achieving the organization's vision as part of their life, and therefore they will work on achieving the vision on a 24/7 basis. The process of achieving the vision is thus not considered work – it is considered life.

Strategic Being

Strategic being goes one step further, as the vision becomes part of every member's being.

Members of the organization feel that achieving is living their life purpose. Thus, they become part of the vision and the implementation process becomes life itself. There is a total integration of the members of the organization as they achieve the organization's future, which is really an extension of their own future.

Why do we need to move from Strategic Planning to Strategic Thinking or Strategic Being?

Now let me explain why I believe strategic planning and even strategic thinking are obsolete in today's global economy. I am convinced that leaders and organizations need to move toward strategic living and eventually organic strategic being, if their organizations are to survive. Is there a scientific explanation for these changes? Our studies over the years have shown that there is a direct correlation between organizational maturity and the mode of strategic exercise or event that the organization chooses. To understand our work in the last 30 years, we began in Netherlands Antilles in 1973 and has subsequently been applied and reevaluated in Brazil, Mexico, the USA and Venezuela. We learned that, although all human beings have the potential to mature, some would stop maturing (stagnate) at certain points in their development. Stagnation inevitably results in feelings of frustration and anger, and, as we have seen, these emotions can cause the sudden shocks that end in tsunamis. Loevinger (1970) developed an instrument that can measure the point where a person has stopped developing and what behavior and value system we can expect from an individual at that stage. The behaviors we discovered in our study highly correlated with the difference levels or stages of maturity measured by Loevenger's instrument:

  • Impulsive
  • Self-Protective
  • Conformist
  • Conscientious
  • Autonomous
  • Integrated

We characterized each level using four dimensions: impulse control, interpersonal style, cognitive style, and conscious preoccupation. Note that most people do not match a single level completely. We describe a person being at a particular stage depending on how closely his or her four characteristic dimensions fit that stage. A person's level of maturity can be anywhere on the spectrum, even between levels. Thus, the ego levels are simply well understood points in a continuous spectrum of human maturity.

As we interviewed people at the various levels of maturity, we discovered that more mature people feel they are the "creators" of their future, while more immature people feel they are "creatures" of fate. To measure the way people feel about their sense of creativity, we used an instrument developed by Dr. Julian B. Rotter (1966), who talks about the "locus of control." A person can be at any point in the spectrum, based on his her Creature/Creator feelings. Our research included plotting ego stages (maturity) stages against feelings of Creature/Creator. Based on our results, we came up with the following picture.

Figure 1: Creature/Creator feelings at different maturity stages

Figure 1 shows the various stages of maturity plotted against how strongly the individual feels that he or she is a Creature or a Creator. Note that the Creature sentiment is highest in immature individuals who have stagnated early in their development and who show Impulsive or Self-protective (that we refer to hereafter as Opportunistic) behaviors. It is at its lowest at the more mature stages such as Conscientious, Autonomous, and Integrated. The feeling of being a Creator, on the other hand, is lowest at the Impulsive level and the highest at the Integrated level.

Our studies also had two other interesting findings. The first one was that as we looked at most organizations and even society at large we found the following distribution of maturity:

Figure 2: Distribution of Maturity in Society

We also found that there was a very different ability to think about strategy at the different levels of development. At the less mature stages of life people feel more like Creatures of fate who have inherited the past and had to go through the exercise of planning and strategizing for the future out of their present state, while the more mature individuals and organizations who saw themselves as Creators were part of the life process and saw the strategic process as one in which they had to create the future out of their own purpose in life. The more mature persons had developed both on a cognitive and emotional level, and had integrated these processes in the way they went about living.

At the Opportunistic and Conformist level we found that mostly strategic planning is a way of life, and the strategic process looked something like this:

  • Rational
  • Linear
  • Orderly
  • Business future predictable
  • Resides with senior leadership
  • Sufficient lead time
  • Focus on the future
  • Clear, integrated plan (strategy)
  • Simple, compelling vision
  • Relies on a predictable future
  • About controlled adaptation
  • Predicated on a stable "fit" over time
  • Results clearly forecast
  • Change in discrete steps
  • All planned out
  • Carefully orchestrated (prepare, prepare, prepare, execute!)

At the Conscientious-Autonomous levels we found the Strategic Process to look more like Strategic Thinking and Strategic Living. The strategic process looks like this:

  • Intuitive
  • Random
  • Tumultuous
  • Business future note predictable
  • Rests with the business units
  • No lead time
  • Focus on yesterday, today, tomorrow's possible futures
  • Semi-coherent, emergent strategic direction
  • Simultaneously address where to go and how
  • Responds to an emergent, unpredictable future
  • Uncontrollable, too many things happening at once
  • About discovering opportunities for growth, letting profits emerge
  • Continuously reinventing the business and emergent results
  • Continuous, endemic change
  • Relies on discovery, expects surprise
  • Many diverse moves, "most good, some brilliant, a few failures"
  • Loosely orchestrated (act, prepare, act, act)

The world is changing as we see in many aspects of society. Major frequent and rapid changes are occurring in the business world. Globalization is having a tremendous impact, and technological advances are taking place at an unprecedented rate, especially in telecommunications. With the event of the Internet everything is happening in REAL TIME in an ANY TIME ANY PACE world: Any time, Any Place, Real Time (=No time). Transparency is becoming a daily reality. All stakeholders have instant access to who you are. Our world is turning into on-line real time, which is also leading to a major preoccupation with Ethics and Sustainability. These changes have led to a world in which we seem to be living from one crisis to another. for example:

  • Airlines are going through a crisis...
  • The big auditing Companies are in crisis...
  • Telecommunications is in crisis ...
  • Latin America is going through heavy crisis...
  • The Political world is in crisis...
  • The Catholic Church is going through a major crisis...
  • The American Economy is in crisis...
  • People and organizations are going through an identity crisis...
  • The Middle East is going through one crisis after another

It seems that not going through a crisis is out of fashion! We used to have time for strategy development and design; Used to have time for detailed analysis and forecasting as part of SWOT exercises; Used to have time for design teams, visioning activities, site visits. The "return on design time" was obvious because strategies and structures were sustainable. Then things began to speed up. Large-scale interventions were an attempt to speed up deliberations about strategy and structure using tried-and-true methods. Now it looks as if change is so accelerated in the business world that there isn't time to logically derive a strategy from an organization's current capabilities. We may no longer be able to use the "old" design model. It looks like the future will not be an extension of the past. If the future isn't like the past, relying on what made us successful may lead to failure. What we don't know could kill us.

In my book Tsunami: Building Organization that Can Survive Tidal Waves I make the case that the structures we have created and process we have developed in our world to date have been built out of the Opportunist/Conformist value system. If we do not change these ways of life, our organizations and our ways of life are in danger of being swept away in the same way that the giant Tsunami sweeps away countries and peoples.

We have watched our world become more global, and we have seen many business and political tsunamis. Some recent examples include: Tyco (& Kozlowski, Walsh, Swartz, Belnick), WorldCom, The Andersen trial, Enron, Global Crossing, Adelphia, Royal Ahold, Chavez's rise to power in Latin America and even Bin Laden and September 11th, Iraq and the Middle East. All of these have occurred because of the tremendous frustrations, anger and stress which the elitist hierarchical structures are causing at the bottoms of our schools, our companies our countries, and our world.

These events have a common cause: the hierarchical, elitist value system. This system is driven by the belief that some people are naturally better than others, and all that this implies. This naturally creates frustration and anger in those at the lower levels of the hierarchy, which only proves the need for hierarchy in the minds of those at the top. This results in a stronger hierarchy and still more frustration and anger. This cycle repeats and reinforces itself, as it did in Cura�ao until it brought about the tsunami that destroyed so much of Willemstad. As our world has become more global, this cycle has emerged in companies, in countries, and even between regions (for example, the First World vs. Third World phenomenon).

Hierarchical elitism is immature behavior. Because immature individuals are dependent on their environment (as opposed to being in control of it) for the satisfaction of their needs, they find the rigid structures of hierarchy protective and comforting. They also find the rigid structures appealing, especially elitist structures, because they see them as a way to gain personal power and advantage over others. Thus, hierarchical elitism is inherently unproductive, as it encourages "every man for himself" behavior. More mature individuals are interdependent and cooperative, and see achievement in terms of the organization, rather than the individual. Their structures are less hierarchical and more egalitarian. Thus, they are much more productive. Strategic planning will only reinforce our past structure, perpetuate immaturity and cause Tsunamis.

Our world has been going through many social and business tsunamis. September 11, for example, changed our world forever. Chavez's revolution in Venezuela is still producing ripples on our world's economic oceans. Iran, China, and North Korea are tsunamis waiting to happen. In the business world we have seen tsunamis like the .COM collapse, the Wall Street crash, and the destruction of ENRON, WORLDCOM, Parmalat, and AHOLD.

I believe it is time for us to work on maturing ourselves, our organizations, and our countries. It is time for us to start thinking and living strategically, to assure all future generations of a dynamic a creative regeneration. The Leaders of our world in crisis have a choice: 1) To continue trying to extract more results from systems in crisis, Or 2) To assure the creation of a more mature organization, guaranteeing its success, its economic sustainability, and contribution to society.

References

Loevinger, J., et al. (1970) Measuring Ego Development (Vol. 2). San Francisco: Jossey-Bass.

McClelland, D. C., et. al. (1953) The Achievement Motivation. New York: Appleton-Century-Crofts.

Pinedo, Victor Jr. (1978) Loevinger's Ego Stages as the Basis of an Intervention Model. In J. William Pfeiffer & John E. Jones. (eds) The 1978 Annual Handbook for Group Facilitators. La Jolla: University Associates Press.

Rotter, J. B. (1966) Generalized Expectancies for Internal Versus External Control of Reinforcement. Psychological Monographs. 80, no. 1.