Strategy determines Tactics

• Having just read another splendid, thought-provoking book, ‘NEXUS’ by Yuval Noah Harari, author of the best-selling ‘SAPIENS’, one sub-section covered the need to align board-level strategies with front-line managers’ tactics if the former are to be achieved
• Key extracts follow but first the book prompted a few thoughts
• In war, end-game strategy must be understood by all ‘captains’ in the field or chaos may well prevail – for example, from our outside viewpoint, we wonder what strategy is behind the death and destruction tactics now being inflicted in Ukraine, Israel, Gaza and Lebanon
• In peacetime, whether at national or business level, strategy formulation is the first of five basic steps that must be followed for any significant and long-term productivity improvement viz:
  • Corporate planning
  • Good productivity measurement
  • Analysis of action needed, where and when
  • Productivity improvement projects
  • Continuous improvement

• Our own book, ‘Productivity Knowhow Revisited’, states the following about corporate planning:
  • A good corporate plan is a punchy summary of where an organisation aims to be in five years’ time and, broadly, how it is to get there
  • Essentially, the plan should define the organisation’s ‘business model’ – how it will be better than its rivals and harder to copy – how it will make money
  • It should act as a reference point, like the conductor of an orchestra, keeping all employees working harmoniously together and ‘moving in the same direction’
  • Glen Moreno, Chairman of Pearson and a director of Man Group and Fidelity, said: “A corporate plan is the reallocation of scarce capital resources towards the best opportunities for growth in earnings and returns”
  • Author, Stephen Covey, said: “Plans are the knowledge about what to do and why – others then have to provide the how to do and employee motivation for want to do“
  • According to Peter Drucker, the corporate plan should provide answers to: “If we were not in this business, would we be going into it now?”
  • Jack Welch, when CEO of GE, said an organisation’s strategy should define the ultimate aim of: “How it intends to win in business:
    • It’s actually very straightforward
    • It’s an approximate course of action that you frequently revisit and redefine according to shifting market conditions
    • It’s about funding the big ‘aha’, setting a broad direction, putting the right people behind it and then executing with an unyielding emphasis on continual improvement
    • It’s resource allocation, given you cannot be everything to everybody, whatever your size”
  • They’re the written equivalent of the inspirational briefings that General George Patton or Vice Admiral Horatio Nelson gave to their commanders before battle – not prescriptive in every detail – they deliberately left tactics for their commanders to decide – the latter didn’t need, or want, any more

Key examples extracted from the book ‘Nexus’ – subsection: ‘Alignment of Objectives’: 

• Facebook:
  • Their algorithm has the strategic aim: ‘To maximise user engagement’
  • They believe hate/ outrage encourages many more people to access their posts/ pages
  • This has led to ‘fake news’ being spread and even widespread persecution of races as in Myanmar
• Carl von Clausewitz wisdom (1830s):
  • He was a Prussian general who fought during the Napoleonic Wars
  • He believed:
    • War is the continuation of policy by other means
    • War is not an emotional outbreak, a heroic adventure or a divine punishment
    • Military actions are utterly irrational unless they are aligned with some overarching goal
• Napoleon Bonaparte (early 1800s):
  • Napoleon had a string of military victories giving him temporary control over vast territories – but they failed to secure lasting political achievements
  • Instead, they drove most European powers to unite against him, and his empire collapsed a decade after he crowned himself emperor
  • And, in the longer-term, they ensured the permanent decline of France
  • Hence, the mere ability to secure military victory is meaningless – the key is to know what political goals will military success achieve
• George W Bush (USA v Iraq War, 2003):
  • This was a recent example of a military victory leading to political defeat
  • The Americans won every major military engagement but failed to achieve their long-term political aims – neither a friendly regime in Iraq nor a favourable geopolitical order in the Middle East
  • The real winner was Iran by the war turning Iraq, Iran’s traditional foe, into Iraq’s vassal and greatly weakening the USA’s position in the region
• Conclusions:
  • Both Napoleon and George W Bush fell victim to the alignment problem
  • Short term military goals were misaligned with long term geopolitical goals – only once the political goals are clear can armies decide on a military strategy that will hopefully achieve them
  • From the overall strategy, lower-ranking field officers can then derive tactical goals
  • There is a clear hierarchy between long-term policy, medium-term strategy and short-term tactics
  • Tactics are rational only if they are aligned with some strategic goal – and strategy is considered rational only if it is aligned with some political goal
  • For example:
    • Suppose, during the Iraq war, an American commander comes under intense fire from a nearby mosque – he has several options for his response including:
      • Retreat his company
      • Storm the mosque
      • Blow up the mosque
    • From a military perspective, it’s maybe best to blow up the mosque – he could easily do so, avoid risking the lives of his soldiers and achieve a clear victory – from a political perspective, this might be the worst thing to do – footage of blowing up a mosque would galvanise Iraqi public opinion against the Americans and create outrage throughout the wider Muslim world
    • Storming the mosque likewise, plus the cost in American lives could weaken home support for the war
    • So retreating and conceding tactical defeat might well be the most rational decision

• Sad to say, many managers think their corporate plans are a waste of time and effort
• And they’re right about most of them
• An annual ritual conducted around Xmas time by a few senior managers whilst those who have to implement them know little about them
• And, once written, even their authors tend to ignore them