Five Perspectives of Strategic Masters: Plan, Pattern, Positioning, Outlook, Strategy

Strategy#

Five Definitions of Strategy: Plan, Tactic, Paradigm, Positioning, Perspective#

Strategy is everywhere: whether it's planning for personal life, the guiding principle for the growth and development of an organization, or various activities such as war, making friends, learning, dating, or even playing chess, all require strategy.

This not only shows the importance and universality of strategy, but also its complexity. To the point where when it comes to strategy, most people think that strategy arises from the spontaneous insight of a strategist who has a holistic view of the situation, to the point of giving up on considering strategy as an object of study.

So what exactly is strategy, and how can we apply different strategies to improve our strategic capabilities?

It is difficult to give a clear definition of strategy, and it is more like the blind men touching the elephant. The more diverse and rich the perspectives, the closer we may get to its essence.

Below, I will discuss the five definitions of strategy, or rather, the five perspectives of understanding strategy.

In this article, I will explain strategy from the following five perspectives: plan, pattern, outlook, positioning, and tactics.

The first two definitions of strategy: plan vs. pattern

Plan#

When we talk about strategy, we often associate it with planning, and images of a determined young person making an annual study plan at their desk, or a group of well-dressed white-collar workers huddled together in the office pointing at the PowerPoint presentation come to mind.

Regardless of the specific type of plan, this perspective that almost equates strategy with planning is a future-oriented perspective, that is, we are trying to predict and plan for the future, whether it is our own behavior or changes in the environment.

In this scenario, the definition of strategy is equivalent to planning for the future.

Strategy is a long-term action plan aimed at achieving specific goals or objectives, while a plan is a detailed outline or step-by-step approach for implementing a strategy or achieving specific results.

Strategy is the best plan carefully chosen to accomplish a specific task or goal. This strategy involves practical thinking and is a part of planning.

Planning is a part of management. It is the first step in the management function. Planning is related to the future. Planning involves assumptions.
Comparison table

What is a plan?#

It is the second step after strategy, which means formulating a strategy by coordinating all the plans to achieve a goal. Planning includes thinking about what to do next and how to do it.

They are operational plans, strategic plans, tactical plans, and contingency plans. Strategic planning is an important plan formulated to achieve a specific goal or purpose.

On the other hand, a contingency plan is a backup plan prepared to be used if the main plan does not work out as expected.

Main Differences Between Strategy and Plan#

Strategy is the first step, followed by a plan.
Strategy is choosing the best option and implementing the plan, while a plan is drafting the plan separately.

Pattern#

But if we shift our focus to the end of the day or the year-end summary meeting.

When we review our actions during this period, we almost certainly find that our plans always fall behind changes.

On the year-end report and to-do list, there are either a few task names that were not foreseen before, or the designer who originally planned everything quietly crossed out the content that should have been completed.

At this point, when reviewing our actions during this period, we find that the strategy has already changed due to inefficient execution and sudden attacks of unexpected events:

Plan + Pattern#

So what is the relationship between plan and pattern? It can be described with a mathematical equation.

Plan = Deliberate plan + Speculative plan

Pattern = Plan - Speculative plan + Emergent strategy

In other words, a strategy that an organization or individual has truly achieved includes the most deliberate and practical strategy from the previous plan (which means not only being able to do it, but also doing it) and some strategies that have emerged later to deal with unforeseen or sudden events.

Control and Learning#

Planning (whether implemented or not) is essentially an attempt to control. To achieve complete success in planning,

the following conditions must be met:

The planner must have strong information acquisition and processing abilities in order to predict accurately.
The implementer must have precise and effective execution.
The environment must be very stable with minimal changes.

However, these three conditions are rarely met in reality.

Therefore, in addition to control, we must be prepared to face unexpected events. As a process of adapting to new things, it can also be understood as learning.

Therefore, in the entire process of designing, responding, and completing a strategy, we not only need to have good judgment of the situation and ourselves, but also need to have the ability to quickly adapt and respond to unexpected events.

This emphasizes the importance of learning ability and adaptability. Many times, we become obsessed with planning and imagine the future as a certain, unchanging, and controllable world. Therefore, from the beginning of planning, we put ourselves on a clear and definite path, and neglect the cultivation of learning ability or fail to prepare for deviations from the course.

Recommendations#

Based on the above model,

1. On one hand, consider your own characteristics, and on the other hand, consider the external environment.

2. Identify the unchanging needs in external demands. We should not always follow the ever-changing external environment, so it is crucial to discover those constant needs.

My recommendation is to engage in ancient activities such as reading, socializing, debating, and meditation. These activities that have not been eliminated by time have proven their value in any era.

As for learning, it is important to focus on those unchanging qualities that are always needed, such as cultivating perseverance, developing rapid learning abilities, and building relationships with others. This is the best way to cope with a changing environment.

The earlier the development stage, the more capital there is for positioning.

Because in the early stages, many organizations and characteristics are not yet defined or structured, and there is more flexibility in making changes, and the cost of creating something new is relatively low.

Strategy is Tactics#

Strategy formulation and strategy implementation

Strategy formulation is the process of formulating a strategy, while strategy implementation is the process of implementing that strategy. Strategy formulation focuses on choice and decision-making, while strategy implementation focuses on translating those choices into action and making changes.

Strategy implementation is simply the execution of your plan. Managing activities also falls under strategy implementation. There are several cases of delivering strategic plans. Strategy implementation is all the activities from the starting point to the endpoint of delivering a product.

What is strategy formulation?#

Strategy formulation is the process of formulating plans and choosing appropriate things. The long-term goal of strategy formulation is to reach the destination with a perfect plan. Formulation involves planning, decision-making, resource allocation, doubt clearance, and time management discussions. Every process and plan to be achieved within a given time frame will be considered in achieving the goal.

Strategy formulation includes six steps. They are setting goals for the organization, evaluating the organizational environment, setting quantifiable objectives, targeting under departmental plans, performance analysis, and strategic choice. Each step has a separate process and goals to be achieved within a given time frame. These steps are arranged in chronological order to maintain the correct sequence for better delivery of outputs.

Strategy is the medium between producers and consumers. If the strategy is effective, it is profitable. The strategy depends on the problem and the situation. The formulation of the strategy also depends on the problem, the ability of the employees, and the time. Considering the factors that affect the formulation of the strategy is crucial. Organizational strength, employee potential, and limitations are the main factors to consider in strategy formulation. Quantitative goals need to be set for each employee in the organization.

The main difference between strategy formulation and strategy implementation

Planning and organizing resources belong to strategy formulation, while the execution of these actions belongs to strategy implementation.

Strategy formulation can be done with a few people, but strategy implementation requires the coordination of multiple people.

Strategy formulation is an initial process with logical abilities, while strategy implementation is the next level process with leadership abilities.

Strategy formulation requires more effort before action, while strategy implementation requires strength during the execution process.

Strategy formulation is an entrepreneurial activity, while strategy implementation is an administrative activity.

Strategy formulation and strategy implementation are the two most important stages in the strategic management process. Strategy formulation is the process of formulating a combination of strategies and choosing the best strategy to achieve the goals and objectives of the organization, thus achieving the vision of the organization. It involves many steps that are executed in chronological order.
On the other hand, strategy implementation is the process of executing the chosen strategy, that is, translating the chosen strategy into action to achieve the goals of the organization. There are many students of management who often use the two terms interchangeably. However, there is a subtle difference between strategy formulation and strategy implementation.

Definition of Strategy Formulation
Strategy formulation is about designing strategies and choosing the best execution strategy to achieve the desired organizational goals and objectives. It is the second stage of the strategic management process. The following are the three main aspects of strategy formulation:

Corporate-level strategy

Business-level or competitive-level strategy

Functional-level strategy

Strategy formulation involves assessing the current business strategy and identifying improvement measures. Identify the key areas where the business needs help from the external primary environment. In this stage, the current issues of the organization are addressed first. Alternative actions are prepared considering all the projects. After that, the corresponding strategies will be formulated for implementation, considering all the matters.

Strategy Implementation Model#

It includes guiding the ongoing strategy so that it can work efficiently and taking corrective measures to improve its performance from time to time. It involves the following activities:

Resource allocation, such as people, materials, money, machines, etc.

Designing the organizational structure for handling new strategies.

Training talent.

Determining functional processes.

Designing systems within the organization.

The implementation of strategy involves managing all the activities from the starting point to the endpoint of delivering strategic plans.

What is strategy implementation?#

This is the third and final stage of the strategic management process, in which the formulated strategy is put into practice to achieve the goals of the organization. Strategy implementation is the process of translating planned decisions into action.

In the earlier four perspectives, we discussed strategy from the front, back, inside, and outside perspectives, but we neglected the "left and right" perspective, which is emphasized by the perspective of tactics.

Strategy can be understood as a tactic, specifically the tactics used to defeat opponents.

When strategy is understood as tactics, our perspective shifts to our competitors on the left and right, focusing on the process of competition with them. The Art of War by Sun Tzu is a classic book that treats strategy as tactics.

This part of the content can be studied in game theory.

The synthesis of the five perspectives
All five perspectives are in play

Each of the five perspectives mentioned above is difficult to use individually, and they should all be considered when formulating a strategy, but this consideration does not require equal treatment.

Therefore, the question that needs to be answered is: in the face of different situations, which perspectives should we pay more attention to?

This depends on the situation we are facing.

Different strategic perspectives are relatively suitable for different environments.

## Situations where the strategic perspective is more suitable:#

When there are obvious competitors.
When the environment has a zero-sum game nature, where one side's victory means the other side's defeat.
When the environment has relatively fixed rules.
When there is a high degree of operability and a variety of means that can be used.

Based on different situations, we consider different strategies to achieve the desired results.

In the three stages of strategy, they are: mission, vision, and values.
Among them:
Mission - Why does your company exist and what value does it create?
Vision - Where does your company want to go and what does it want to become?
Understanding is: when doing business, it is important to have a clear purpose and goal, as well as what to achieve.

Time dimension (how long your company wants to operate, whether it is phased or can be passed down for generations);
Employee dimension (how employees have changed due to the company);
Customer dimension (how customers have changed after using your products and services);
Scale dimension (how big the company wants to become, what is the positioning)

First: Why do small companies become bigger?
Then: What happened during the growth process?
Continue: Why do large companies have lower efficiency?
Finally: Why can't large companies be fast?

I. Why do small companies become bigger?

Of course, usually only companies with good business development will grow bigger. So, the most direct reason is: there is too much work to do, and more people must be added.

After adding people, naturally there will be work to assign. Since it is assigning work, there naturally needs to be some division of labor. For example, if a company only has one programmer, naturally all the work will be done by him. After adding a few more people, it is possible to divide roles into front-end, back-end, DBA, testing, operations and maintenance, and various other roles.

Different types of work naturally require collaboration. Meetings, documents, hierarchical relationships naturally need to be gradually established. These can be considered as "reasonable costs".

II. What happened during the growth process?

Auxiliary departments begin to appear: After the number of people increases, there is a need for dedicated HR personnel; after the company expands, there is a need for dedicated cleaning personnel; unified logistics support also becomes a rigid requirement;
Coordinating departments begin to appear: PMOs and other offices are used to coordinate multiple projects; meetings increase, and there is a need for a department specifically for coordinating meetings; conflicts between departments require a higher-level joint meeting for coordination; there is a need for standardized procedures, and a department specifically for developing process standards begins to appear;
Supervisory departments begin to appear: With more people, it is inevitable that there will be bad actors, so there needs to be an "Ethics and Discipline Committee"; with more work, it is inevitable that there will be mistakes, so there needs to be a "Quality Assurance Committee"; with more external transactions, it is inevitable that there will be risks, so there needs to be a "Contract Risk Review Committee";
Competitive departments begin to appear: Under the influence of certain management philosophies, multiple departments with similar goals are established to promote efficiency through internal competition;

These departments are not unnecessary, right? The boss is not a fool!

III. Why do large companies have lower efficiency?

First, we need to understand what is considered high efficiency and low efficiency. The same task, if it is small and simple, small companies often do it faster, and even better; while large companies tend to do it slower, or even worse.

However, if it is an extremely complex task, small companies may not be able to complete it at all, while large companies, even if they are slow, can at least get it done.

So, our question should be transformed into: "If a task could have been done quickly and well, why is there so much waste in large companies?"

The fundamental reason is that the management model of large companies is not flexible enough and lacks "scalability". Let's use the example of setting up a computer server: "When the traffic increases, we can keep adding servers. However, when the traffic decreases, everyone forgets to remove the servers."

IV. Why can't large companies be fast?

A sense of grandeur, even small matters are often made a big deal.
Risk awareness, no one dares to say, "Most of the time, a certain process is unnecessary."
Involvement awareness, how can this matter be unrelated to our department?
Self-preservation awareness, as long as the process is strictly followed, even if something goes wrong, the responsibility will not fall on me.

In the final analysis, it is a lack of continuous improvement awareness (or in other words, when a company becomes so large that even those who want to improve face a deep sense of powerlessness)