What is driving your strategic intent?

In addition to training, I also consult with organizations in the area of strategic planning, governance and enterprise architecture. On many occasions I’m asked to help with evaluating their business strategic plans and make sure they represent the direction the business wants (and should) pursue.

The term strategic intent comes up quite often. What exactly is strategic intent and how does an organization go about determining what direction to take?

Strategic Intent was first discussed by Gary Hamel and C.K. Prahalad in 1984, but it gained wider prominence when they published an article about it in the Harvard Business Review in 1989. Simply stated, strategic intent represents a succinct and cohesive vision of an organization’s aspired direction of growth.

This strategic focus plays an important role in shaping how resources are allocated and what future capabilities might be required to achieve this direction. Many of my client’s challenges include questions like “Are we going in the right direction?” or “Do I have the right resources and capabilities to achieve this new vision?” These are great questions to ask. Blindly following direction without a plan is like throwing mud at the wall and seeing what sticks. And yet many companies do exactly that. Or, perhaps worse, completely miss an opportunity because they are working with faulty data or assumptions.

We are living in an ever-changing environment. Marshall Goldsmith wrote a book entitled What Got You Here Won’t Get You There. And while he was talking mostly about personal leadership development, I believe the same premise can be applied to organizations.

Former Intel CEO Andy Grove said it best: “A corporation is a living organism; it has to continue to shed its skin. Methods have to change. Focus has to change. Values have to change. The sum total of those changes is transformation.” Organizations are influenced by many factors in their environments. It could be opportunities (such as new or retiring technologies), threats (such as competitors) or constraints (regulations, for example). This ever-changing environment impacts the strategic context of the organization as defined by Peter Weill and Marianne Broadbent in their book Leveraging the New Infrastructure: How Market Leaders Capitalize on IT. This strategic context incorporates not only the strategic intent but also an understanding of the organization’s core competency, current strategy and business governance. This changing environment impacts what products or services to deliver, and more importantly, what investments (in terms of people, processes and technology) the organization must make in order to achieve the desired results.

Rather than blindly going in a direction without understanding which direction is best, an organization should first do its homework and identify and analyze the key drivers of change in the strategic or business environment. One common method is to use the PESTLE Analysis tool. The abbreviation stands for Political, Economic, Social, Technological, Legal and Environmental factors. The tool allows users to assess the current environment and potential changes. I will talk more about PESTLE in future articles.

An organization’s strategic intent should answer not only “What are we trying to accomplish?” but also the question “What is driving us to go in that direction?” In fact, an effective strategic intent not only provides a sense of direction but also a sense of discovery where the organization can learn about best practices in its industry (and avoid making the mistakes of others), and sense of destiny that defines the future vision of what the organization is aspiring to become.

Do you know your organization’s strategic intent? How do you identify and analyze your key drivers of change? I would love to hear your thoughts.