Michael Raynor falls in the gap

Update: This post is adjusted since I attributed some of the answers to Guy Kawasaki and not Michel Raynor who actually answered the questions.

Today Art Hutchinson pointed me to Guy Kawasakis blog and the post on Michael Raynor's book The Strategy Paradox called How to Change the World: Ten Questions With Michael Raynor. It struck me as Kawasakis post set the light on a very good example on how to talk about strategy within it's own realm. E g taking little, if any, notice of the fundamental changes at lower levels which is what both changing the game radically, but also underpins the fundamental uncertainty today.

I started to get real interested when Raynor started to talk about the different levels:

The rest of the solution lies in calibrating the focus of each level of the hierarchy to the uncertainties it faces.

Yes, this sounds terrific! But then he ends at the middle manager level saying:

Managers should ask: How can we best execute on the commitments that have been made in order to achieve our performance targets? To put it on a bumper sticker, they have to “show us the money.” There are no strategic choices to make at this level, because the time horizons are too short—six to twenty-four months. Strategies simply can’t change that fast.

By the last sentence he is defining the whole game from a strategic level where the uncertainties are believed to come come from the outside the organisation which makes the lower levels strategically irrelevant. The point I was trying to make in my (to long) post Mind the gap a couple of days ago was that this exclusive view from top of "Mount Strategy" is a fundamental part of the problem. And even more so in the future. When Raynor refers to Stephen Wolfram saying:

First, any system must have boundaries that define it, since any system without boundaries would be the universe itself. Second, no system is entirely closed. Therefore, every system is subject to exogenous, and necessarily unpredictable, shocks that introduce randomness into the system.

he is right! But Raynor misinterpret what this means. The shocks that introduce randomness into the system can also come from what is thought to be the conceptual foundation for the strategic level of thinking. Strategic thinking is actually constituted by and dependent on the work at the lowest level. In this sense the strategic world could be a separate system not just from the outside world, but also from the lower levels on which depends and claims to include.

Yes, I agree with Art's post, that

A need for divergent scenarios that empower management teams to think systemically across and around boundaries--recognizing but not being hemmed in by them [my emphasis]. The goal: strategic resilience whatever may come.

But to do that you have to cross the gap and embrace both levels to do a good job.

4 thoughts on “Michael Raynor falls in the gap

  1. Guy Kawasaki

    You lost me: this is an interview with an author. I did not write the answers--the parts you quoted. I simply asked the questions. The text you attribute to me were from the author.

    Guy

  2. Martin

    Ooooops!

    Guy, I'm terribly sorry!! I read your post as you were answering the question by using the ideas from the book. I will adjust my post (especially the title!!).

    Again, sorry!!

    /martin

  3. Michael Raynor

    I think you make a good point, Martin, in drawing attention to the fact that organizational uncertainty is a relevant and salient source of unpredictability. For my purposes, though, a fair bit turns on separating that from bone fide strategic uncertainty because an organization's strategy consists of the choices it makes that define the parameters of how the company creates and captures value. What happens within those parameters matters a lot, and is subject to material uncertainty, but it's not strategy or strategic uncertainty per se, it's operations and operational uncertainty (or implementation, or execution, or just getting stuff done -- and the inevitable speed bumps that come your way when trying to do that).

    So, for me, strategic uncertainty is de dicto exogenous to the organization. I certainly have plenty of room in my framework for the phenomenon I think you're describing (and spend some time discussing it in the book) but I've found it helpful to treat it as a phenomenon distinct from strategic uncertainty and strategy making.

  4. Martin

    Michael, thanks for commenting and I am, as you clearly understand, not posing any critique about your book, per se. I haven't read it (yet)... so I am not in the position to critize it at all! Since I work with strategy consulting and scenario planning uncertainties are my trade, so your book is probably provides an important angle on the issue.

    In one of my parallel threads I am in the process of trying to understand the anomalies I think I see when I read texts and hear discussions on strategy, but also in many strategic discussions. One is understanding the strategic gap which dives organizations in two parts everywhere. Another connected issue is about understanding in what way the technological and conceptual changes in our society and how we humans organize and see the world, changes the upper levels of discussions about the world.

    One angle on this is that we often miss or misjudge the changes that are of a conceptual kind i e are hidden in concepts we believe are stable. (related to Kuhn and paradigms??)

    E g some theorists as well as practitioners are starting to realize that the concept of "company" or "corporation" is not any more relevant for analyzing many value creation processes in both business and society. The reason behind that is of course many, but one of the deepest seems to be the use of new comminication technology which change the way both individuals and organizations communicate and create new connections. It even seems to redefine some of the fundamental premises for the ideas on which we build the ideas about our world.

    I am heading in the direction that there are other relevant dimensions of strategic thinking overshadowing e g the strategic/operations dichotomy. And I am not even talking about emergent strategy or other ideas that builds on Granovetter and others... I am thinking about conceptual issues when some of the fundamental concepts building a certain strategic perspective some times isn't valid since it is implicitly constituted by a number of ideas and facts that no longer are certain or even holds true. Maybe I could call it a conceptual problem of strategic thought?

    So what I think this says about your discussion is that some important strategic uncertainty may also lie within the concepts you use to define the strategic platform you start from.

    One reason for starting to delve into the strategic gap is that this gap insulates the strategic level from everything else and maybe most important from the foundation which make it possible to talk about things at a strategic level at all.

    I am not at all ready with this thinking, so I apologize for being a bit fuzzy about.

    Again, thanks for the comment and I apologize for using your name as an example of something very different than what you are aiming at with your book!

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