ICG

Work with the Strategy Canvas

They still exist, the classic planning rituals with their detailed analyses and five-year plans. But more and more often, they reach their limits and cannot provide the desired orientation and direction. A more agile understanding of strategy work usually meets the current requirements much better.

First of all: If your business, your market environment, your technological developments are easily foreseeable and plannable, and your key strategic questions are the market positioning and the product portfolio, then the proven strategic analyses and plans will continue to be the method of choice. The methods from SWOT, Portfolio, Core Competencies to the Business Model Canvas are well known and proven. Good preparation and organization of the strategy process and involvement and communication for implementation are key success factors.

Changing requirements

More and more often, however, it is no longer possible to predict the future by projecting the past. Crises with a surprisingly broad impact, caused by an incredibly highly interconnected economic world, are becoming more important. Uncertainty increases, regardless of whether the driving factor is digitization, Covid, climate change or bank failures. Strategy development under uncertainty is important, but requires different approaches than in times of stability.

Strategy as a guard rails and framework

At the beginning of the strategy process, the question should be: What are the expectations for the outcome? If the situation is clear, i.e., if the relevant developments can be easily foreseen, it is still possible to orient the strategy to a future vision and to define the strategic path to get there. When the fog is thick, i.e., when developments are uncertain or ambiguous, the strategy can provide a rough direction and guardrails, supported by commonly held principles and values. Within this framework, opportunities, chances and risks are identified in small steps, action is taken, reflection takes place and the next steps are planned.

Intensive customer and market connection

A strategy process often begins with a careful analysis of the figures and data on market development in recent years to estimate future trends. In the case of stable developments, this makes perfect sense. However, trend breaks and other VUCA effects cannot be recognized by looking in the rearview mirror. In agile strategy work, the market and customer view are integrated intensively from the very beginning. This is achieved by observing customers and users, through prototyping and rapid feedback on ideas, to the integration of customers into developments. In this way, it is also possible to detect weak signals that anticipate disruptive changes.

Quickly get into action

Strategy lives on action – and therefore the right methods of implementation must be chosen. This can take the form of classic, strategic projects, which can be supported by steering teams at longer intervals.

Alternatively, or complementarily, agile implementation models such as speedboats or rapid results can be used to achieve rapid success. Based on the strategic framework, initiatives are set up and anchored in day-to-day business through agile methods and rituals. In this way, it is possible to raise awareness and increase the speed of implementation.

Evaluate, refine and learn

The key is not perfect plans, but implementation experience that evaluates and refines the current situation. In times of great uncertainty and rapid change in the environment, the strategic direction must be adjusted at shorter intervals. Quarterly strategy refinement workshops allow an adaptive strategy process. A strategizing team manages this process. In this way, the strategy is continuously refined. A particularly effective agile instrument for this is the OKR method. Here, measurable goals (objectives) are defined for a specific period (usually three months). A maximum of five key results, concrete and measurable results, are then assigned to each of these objectives. After a certain period of time, often three months, these are reviewed and the next phase is planned.

Exploit virtual opportunities

Traditional strategy work used to take place mostly in closed sessions in seminar hotels with selected participants. Through Corona Restrictions, we have seen how digital tools offer opportunities for highly effective virtual strategy development and implementation. For example, many more experts can now be brought into virtual or hybrid workshops, and the number of participants can be adapted more flexibly to the specific strategic issues.

The Room for Experimentation

“Strategy must be consistent and free of contradictions!” So, it is written in many not so old textbooks. Behind it is the assumption that there is only one reality – and we know it. More and more often we have to say goodbye to this paradigm and allow for both consistency and contradiction.  This is what we call “strategic ambidexterity”. In the case of uncertain topics, thinking is done in terms of affordable loss. Experiments are being allowed, and experiences are being evaluated and learned from. Thus, speedboats can be launched in different directions to quickly identify the better path. The basic understanding of strategic ambidexterity can also resolve the often-observed contradiction: On the one hand, a detailed five-year strategic plan is required – on the other hand, it is unclear what our world will look like in half a year.

Strategy Canvas

Getting out of old thinking habits

In addition to the new rules of the game and agile elements for strategy work described above, there are also new tools for exploring the future. More often than you think, there are already clear signs of future developments. However, we often fail to read these signs correctly. This is because we observe the world with old thinking habits. Exactly at this point we use the Strategy Canvas, a quite simple system to climb out of our usual thinking grooves. The first part of the Strategy Canvas is based on the research work of the German Zukunftsinstitut which deals with the analysis of trends and future developments. The central consideration is the impact, i.e. the effects of events such as Covid-19, climate change, political events, but also the trend around New Work.

We have based our development on the Zukunftsinstitut’s Trend Impact Canvas and further developed it as a strategy canvas for our strategy consulting.

The triggers of transformation

The first part of the Strategy Canvas, the Impact Canvas, can be used to make a very compact and holistic estimation of the strategic environment and the strategic options for action. Simply put, it is about organizing information and reducing complexity. In this way, risks and potential can be identified and relevant areas of action can be derived. The starting point is the question of how a specific (possible) event or trend will affect our business and our organization. Specifically: Something is happening in the world – currently the (after)effects of Covid. And there are sometimes quite generic implications that can be determined (see example below). For the aspects of people, society and the economic environment, good triggers can be found in the research work of futurologists.

The most relevant strategic questions

One can use the Strategy Canvas as a pure analysis canvas by examining the impact/trigger of the trends on the existing markets, products, processes and organization. This helps to formulate the most relevant strategic questions. It is now more exciting to think in terms of new opportunities. Building on the triggers then starts a strategic dialog: What do these triggers mean to me? What impact does it have on my economic and social environment? What impact does it have on my industry? What are the most exciting strategic questions for me at this point? And now it gets creative, now your entrepreneurial spirit is challenged: what does this mean for my offerings, my products? What am I doing newly/differently? And with these new solutions and services, I can then explore what impact this has on my processes and on my organization, leadership, etc. So, with the Strategy Canvas, you can do very compact and holistic assessment of the strategic environment and possible courses of action. It is about organizing information, reducing complexity and thus getting a clear picture of the situation. This allows risks and potential to be identified and relevant actions to be derived.