I am boggled that my video on planning versus strategy has gone viral, poised to hit over 1 million views in just a little over two months since Harvard Business Review put it up on June 29. But from the comments and reviews, people are really intrigued — including a fascinating guy who used the whole video, slice by slice to do an analysis of Tesla’s strategy versus GM’s plan. His has gotten almost another 100K views! Lots of the questions I have gotten have been about why is there such a predominance of planning over strategy in the business world? So, I decided to dedicate my 44th Year II Playing to Win/Practitioner Insights (PTW/PI) piece to Why Planning Over Strategy: And How to Fix the Problem. You can find the previous 96 PTW/PI .
Why Planning Over Strategy?
As with many things in life, an outcome that doesn’t make sense, ironically, is often the product of a process that makes lots of sense. There is an enormous amount of planning in the modern world of business and very little strategy — for a reason. I have laid out the causal map (with feedback loops) above and will talk through it below.
Dominance of Analysis in the World
The world is on a zealously science-obsessed tangent by which it is attempting to apply science to everything whether suitable for scientific analysis or not, as I have written about repeatedly before , and most extensively but behind a paywall). This science-obsessed view favors analysis of the known over any other kind of thought or work. There is an implicit assumption that whatever is will continue to be (and that assumption has to be implicit because if it was explicit, it would be embarrassing to the assumption’s holder).
Analysis Encouraged in Business
The world’s penchant for data analytics causes analysis to be strongly encouraged, supported, and rewarded in business. And planning fundamentally concerns the analysis of the known and setting forth a sensible set of initiatives that collectively manage the known — or at least appear to until things change and then the ensuing problem is blamed on ‘unforeseen chance events.’
Strategy, in contrast, imagines a desirable future and makes a set of choices with the best chance of bringing it about. It is fundamentally not analytical, which causes it to conflict with the analytical bent encouraged in and supported by business.
Business World Friendly to Technocrats
This belief in analysis that drives a love for planning renders the business world very friendly to technocrats. Technocrats focus more on inputs than outputs. They are driven to check all the boxes and follow the prescribed procedure (often prescribed by themselves for themselves). Planning is all about inputs: these are all the things that we are going to do, and since we have been thorough and analytical, all these initiatives are justifiable.
In contrast, entrepreneurs are laser-focused on outputs. They don’t check the boxes and rarely follow any prescribed process. And strategy, as I argue in the video, is all about producing outputs that you don’t directly control.
Feedback Loop — Makes Business World More Analysis-Friendly
The preponderance of technocrats in business makes the world of business even more friendly to analysis and planning, which attracts more technocrats to ply their inclinations and skills in a friendly and supportive environment.