Enterprise Architecture has always had a slightly unbalanced relationship with strategy. Often the line taken by EA is that its job is to follow strategy, to design, redesign or reconfigure the enterprise to be able to deliver the strategy and the strategy is accepted as a ‘given’ as if it arrived on tablets of stone from on high. There are two problems with this positioning: first, it ignores the critical role that EA could fulfil of designing the information streams that strategy needs and second, strategy rarely arrives in a form that is easily translated into the language of organisational capability that EA uses.
In their new book Patrick Hoverstadt and Lucy Loh describe Patterns of Strategy – a revolutionary new approach to developing business strategy. It’s effective, simple and fast to use, yet extremely powerful. It uses a pattern language to develop strategy as a series of manoeuvres between all the players, from competitors to partners, from the regulator to the marketplace itself. It provides a framework and new vocabulary to understand the underlying forces driving strategic relationships, so that you can tap into these forces and use them to your advantage to achieve the strategic fit you want. For strategists, it has some key advantages, compared to conventional approaches.
- It’s faster – so you can run multiple strategic scenarios and explore multiple options.
- It’s precise – modelling strategy as a set of manoeuvres allows you to quickly plan the changes needed for each manoeuvre and the metrics of success. You can be precise about which capability needs to be more agile, by how much and with what effect.
- Competition & collaboration – most strategic approaches assume it’s all about competition. Patterns of Strategy works just as well for collaborative strategies,
- Business ecosystems – it provides the ability to model the dynamics of a business ecosystem which allows you to predict the likely future states of a strategic environment.
- It connects directly to other approaches – for enterprise design, and for scanning your strategic environment,
That’s for strategists, but for EAs it also addresses both aspects of EA’s problem with strategy. The capability to develop strategy is as much a part of the enterprise as the capability to run a supply chain or to deliver product, and it should be every bit as designable as any other aspect of the enterprise. Arguably it could be the most important bit of the enterprise to get right, but EA struggles to design this and part of the reason is that, as David Norton (of Balanced Scorecard fame) put it:
“Logic says that we have to manage Strategy. But, in many organizations, there is no process to manage it, and the need for such process hasn’t dawned in the minds of those executives.”
As long as strategy is a black box, it’s difficult to design the information feeds that ensure it will be based on good information rather than hunch or reaction to tactical demands. And if you don’t provide the right information into a strategy formulation, why would we expect good strategic choices to come out? It’s like anything else, garbage-in-garbage-out. What Patterns of Strategy does is to make the process of formulation visible and, critically, to make the information needed for good strategy visible and designable. This means that EAs can fulfil a genuinely strategic role of designing the feeds of critical information that strategy needs – the opposite of garbage-in-garbage-out. One aspect of this involves checking strategies against capabilities – given the capabilities you have and the ones that could be developed within the strategic window, which strategies could you really do from where you are? – EAs using their deep understanding of organisation capabilities to highlight strategic options which aren’t immediately obvious. And if that information was available to strategists you’d end up with a lot fewer strategies that were simply impossible to execute.
On the output side of strategy, Patterns of Strategy shows a strategy as a set of manoeuvres the enterprise will undertake relative to other enterprises in its strategic space. And you can be really specific about the capability shifts needed for each manoeuvre. So the translation from strategy to organisational change planning is both simple and fast. In building and maintaining an enterprise roadmap, this is a critical advantage, since the cycle of time of strategy and the cycle times of infrastructure investment can be very different, so understanding how the two interact is critically important to avoid either de-railing the other.
There is a further advantage to the approach for both EAs and strategists. There is lots of (often quite unspecified) demand for organisations to become ‘more agile’. Obviously this is a response to the perception of a faster rate of change in the business environment, but it’s usually focused on making operations more agile – and Patterns does provide the precision to understand where agility might help and how much agility we are willing to pay for. But the highest leverage point for building agility is not in the operations, it’s in strategy. Patterns of Strategy allows you to dramatically reduce your decision-action cycle time – the time it takes to inform, take and action a decision – in some instances by 2 orders of magnitude. If your strategy formulation cycle can be condensed from months to days, or less, and the output is tighter, more structured and provides better insight, then that can itself provide a critical strategic advantage. And in this day and age, that can provide the difference between corporate survival and failure.
Patterns of Strategy is published by Gower and is available in hardback, paperback and kindle.
“Patterns of Strategy is the first major new approach to strategy in a long time. Not re-packaged versions of existing ideas, but a completely new, and radically different, approach. The book offers descriptions of 80 common patterns of strategy in a ‘recipe book’ style, together with detailed advice on when, and how, to use them, and in what situations. It will be a “must have” for strategists. Paul Barnett, CEO, Strategic Management Forum
Copyright Patrick Hoverstadt and Lucy Loh