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So, You Want to Become a Strategist? Develop a Macro Perspective

March 21, 2017

Part of being a strategist is having the ability to see things at the macro level. This ability is a key aspect of strategic thinking. Various terms that have been used to refer to this ability includes having a “bird’s eye view”, “helicopter view” and the ability to “see the forest instead of the just the trees”. A natural question one would ask is how do we develop this ability. Is there a method to develop this macro view of the organization?

Before we proceed, there are a number of issues that need to be explained about having a macro perspective. 

  • First, it is about seeing the organization as whole instead of seeing things from a functional perspective only. 

  • Second, understanding the organization involves understanding how the organization operates as a system. This includes understanding the synergies that the organization has that enables it to create value and compete. 

  • Third, developing a macro perspective involves understanding the organization in its competitive context. One cannot understand the strategic issues facing an organization without understanding what is happening in its external environment. 

  • Fourth, the macro perspective is not merely about having a snap shot of the organization and its environment. It is very important to have a temporal view of what is happening i.e. what is happening now and what will probably happen in the future.

 

Developing a macro perspective consists of two basic elements. 

  • The first is developing a simple overview of the organization and its environment. This involves pattern recognition to discern the key issues. 

  • The second is developing the ability to see the trend emerging from these patterns. 

 

The simple overview can also be described as the spatial dimension of the macro perspective. This is because it is mainly concerned with how various parts of the organization and its environment are connected. The temporal dimension of the macro perspective is concerned with how the big picture will evolve in the future.

How then does one develop these two dimensions? Understanding the spatial dimension involves balancing between the ability to simplify and yet maintain the ability to explain a complex phenomenon. Achieving this involves developing the ability to think at a more abstract level. Can someone develop this ability to understand the spatial dimension?

Well, it depends on one’s thinking habit? Some people develop a higher level of abstraction by depicting the phenomenon they are observing graphically. They may use icons, cartoons, graphs and familiar images to describe a situation. For instance, a person may use the sinking Titanic to describe an organization in trouble. Another may use a besieged castle to depict the challenges of competition. Some may use flow charts to depict the phenomenon they are describing.

There are also many people who prefer to simplify their thoughts by using figurative speech e.g. by using analogies, metaphors and even idiomatic expression. Thus, we see untapped market being described as “blue ocean”, organizational stagnation as “frog in frying pan”, “chaos” being used to describe uncertainty and an efficient organization being described as a “well-oiled organization”.

Others, especially those more quantitatively inclined, may prefer to simplify their thinking by using equations. This can be in the form of a regression equation to depict the key variables determining an outcome. Others may use tables to show scores and statistics.

The key challenge in developing the spatial dimension is identifying the key variables that should be included in the abstract description. These variables have to be described in the form of a relationship. It has to be able to explain the outcomes and drivers of the outcomes. It requires the ability to see the distinguishing feature of the many things around us and identifying which of these features are changing and affecting us.

 

Developing the temporal dimension involves assessing how things will evolve. This is about our ability to recognize patterns from the information around us. It involves seeing the variables included in the spatial dimension from a behavioural perspective. A key concern is how these variables are changing. It includes understanding who are creating the changes and why they are making it. A strategist need to understand this by looking at 

  • Direction 

  • Velocity 

  • Magnitude of these changes 

 

A critical inference a strategist has to be able to make when looking at the temporal dimension is whether the direction, velocity and magnitude of changes are leading to convergence or divergence. For instance, the success of Apple’s OS and Google’s Android basically has led to a convergence in the smartphone technology. The same can be said of GSM in cellular communication. During convergence, competitors typically innovate around the technology that becomes the industry standard.

On the other hand, there are still many competing technologies in green car technology. There are hybrid cars, electric cars, solar cars and we may also see hydrogen fuel cell cars soon. Divergence tend to create more uncertainty, risk and challenges because it is still not clear which of the technologies will become the standard in the long term. Competitors have to decide which technologies to invest in and help push it to become the dominant standard.

In some industries, there may not be a trend towards convergence. Instead, creating divergence helps open new markets and opportunities. This is the case in the fashion and food industry. Convergence, on the other hand, may create a saturated market with more players offering similar products and chasing after the same customers. Just look at how many different players are claiming to offer Nasi Briyani Gam or Sate Kajang.

Developing the macro perspective, both in defining the spatial and temporal dimensions, is not easy nor straightforward. It requires practice and the strategist should be open to feedback and critique. In fact, the process should be an iterative and a collective one. The ideas raised should be debated, refined and further developed. It should be hypothesis driven where ideas are proposed and then evidence is sought to either confirm or refute them. The process is not a one-step judgement.

So, can everyone become a strategist? Everyone has the potential to become a strategist. But only those who have the discipline to develop a macro perspective in thinking about organizational issues will become a good strategist.

 

 

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