Written by John Sutherland and Jacqueline Stavros
The origins of strategy are deeply rooted in our warfare history. Current strategic models and thinking have a bias towards ‘killing off the competition’. Even if this was appropriate in the past, it is inappropriate now in our interconnected world, where the idea of ‘us and them’ only serves to increase conflict. We need to choose a new heart for strategy – one that is consistent with the principles and spirit of Appreciative Inquiry (AI).
This article explores the development of strategy from the battlefields of war to the boardrooms of our client organizations. It shows how the current warfare mindset has stayed in place despite many years of new thinking and writing. It considers the implication it begins to explore what an Appreciative Strategy might look like and sound like, and introduces a field book of practical tools for use in strategic consulting.
The Roots of Strategy
The roots of organizational strategy lie buried in the soil of our warfare history. The influential writings of generals such as Sun Tzu and Carl Von Clausewitz have been key nutrients for our current strategic thinking. In fact so strong is the warfare mindset that even modern works, like Mintzberg’s (1998) ‘Strategy Safari’, take it for granted that the object of strategy is to compete rather than collaborate, to become the strongest force and to dominate the market. Warfare thinking is still big business. Sun Tzu’s book (1971) on the Art of War has recently been in the top ten selling list for business books. Competing for the Future (1996) by Hamel and Prahalad has been called a classic.
Organizations such as Rainbow Warriors (Greenpeace) and War on Want tell us that warfare thinking even permeates charitable organizations. In the United Kingdom (UK), CCT (Compulsory Competitive Tendering) ensured it entered the public sector. Even the Queen’s symbols of power are a mace (a club you hit people with) and a sword. Warfare lies at the roots of our modern society and is so taken for granted that we no longer notice its impact on our thinking. Even the words we use are telling. Consider the origin of these well-known terms:
Ø Task force
Ø Bullet points
Ø Making a killing
Ø Front-line troops
Ø Communication lines
Ø Command and Control
A warfare mindset often brings with it other unwelcome guests to our strategic framework. The most fundamental is a scarcity mindset. Fear-based scarcity and dominance models automatically lead to a battle mentality (It’s us or them), a desire to hoard the earth’s resources (Better grab it whilst you can) and abuse our human resources (Get as much out of them as you can). In terms of planet, people, and prosperity, fear-based models can only work in the short-term before obvious problems of exhaustion occur. The outward sign of our battle mentality is the automatic acceptance of competition as the modus operandi for business. If we plan our strategy based on the premise of scarcity and threat, we tend to adopt a dominance model and thereby create the enemies we dread, through our aggressive actions. The SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), for example, is still widely used by organizations (commercial and public sector). Weaknesses and threats are classic examples of warfare thinking. They result in expending energy on protecting potential vulnerability and picking a fight with other players in the same market.
By using such models we run the risk of continuing a mindset that divides and rules, competes and conquer, and creates a world of winners and losers. Even if this was appropriate in the past it is increasingly out of step with our interconnected global village. Today we realize that when we “beat” our so- called enemies it can very often have a negative impact on the whole system of which we are a part. Thereby doing more harm than good in the long run. We cannot build the future we all want with a warfare mindset. There are other models and choices that will be presented in this article.
Table 1: SWOT Model
Where we can outperform others
Where others can outperform us
How we might exploit the market
What/who might take our market
The SWOT analysis summarizes the key issues from the business environment and the strategic capability of an organization that are most likely to impact on strategy development. It is perhaps the mostly widely used business model. The original idea behind the model can be traced back to Philip Selznick’s book ‘Leadership in Administration’ (1957). This model will be further explored in the article by Stavros, Cooperrider and Kelley in this issue on ”Strategic Inquiry with Appreciative Intent: Inspiration to SOAR!” Appreciative Inquiry (AI) recognizes that the framework and focus we use for our development are fateful. In practice, AI practitioners and leaders tend to be values-based rather than fear-based. Marge Schiller, et al., (2001) noted that Appreciative Leaders tend to “live their values aloud”. AI practitioners often work in open partnership, sharing what they have with each other. The warfare mindset does not reflect our best practice but is still strongly in evidence in organizational thinking and business models. So, have any of the recent developments in strategic thinking improved matters?
Developments in Strategic Thinking
Strategic thinking is making sense of how you think of strategy. Strategic thinking involves gathering information, formulating ideas, and planning the action (Wootton & Horne, 2000). Each of the following steps involves a different thinking ability (p. vi):
Reflective Thinking Skills? >>>>> >GATHERING INFORMATION
Step 1: Analyzing what’s changing
Step 2: Doing an audit
Step 3: Reflecting on what you know
Imagination and Visualization Thinking Skills? >>>>>>FORMULATING IDEAS
Step 4: Predicting where you’re going
Step 5: Deciding where you should be going
Step 6: Minding the gaps
Creative and Consensus Thinking Skills? >>>>>>PLANNING ACTION
Step 7: Creating more options
Step 8: Checking them for sense
Step 9: Deciding how to implement
Strategic thinking has developed a wide range of approaches over the last forty years. For an excellent overview of the twists and turns, the interested reader is referred to Mintzberg et al.’s (1998) review in ‘Strategy Safari’. They describe ten different schools of strategy that have emerged in recent times. The critical milestones in this story have been the way strategy began as a planning process and has evolved into a learning process, as it became clear that planning ahead did not allow for the ‘expected unexpected’. The role of power, politics, and culture in influencing what actually happens, as opposed to what was intended, has also been noted. With hindsight, we need a mix of strategy as planning and strategy as learning. We need to think ahead to the future we want to co-create and take account of the changes that take place as the future unfolds towards us. Planning without learning, or adapting our plans in the light of new events, leads to plans that soon become out of date. Learning without planning leads to ‘creeping incrementalism,’ where we keep making a series of small adjustments to our original plan, but fail to stand back and see the big picture or spot the need for transformational change. Transformational change involves change at both the internal level — individual and organizational — and the external level: uncontrollable factors in the environment like industrial, political, economic, societal, competition and technological. Other important drivers of transformational change are leadership, organizational values, vision, mission, strategy, and culture (Burke et al., 2000).
One valuable development has been the involvement of larger groups of employees in developing vision and strategy. The work of Jacobs (1994) and his ‘Real Time Strategic Change’ provides an effective way of working with large groups. However, whilst much attention has been given to ‘how to do strategy’ (how to make it work), less attention has been given to ‘what strategy is for’ (the purpose of strategy). There has been little fundamental challenge to the warfare mindset, although some writers, for example Bob Garratt (1995), have given strategy a neutral stance of achieving the organization’s purpose.
One notable exception to this is the work of Peter Hawkins (1991), who wrote his paper on ‘The Spiritual Dimension of the Learning Organization’. The paper is in essence a call to apply all three of Gregory Bateson’s (1973) levels of learning to the notion of the learning organization.
No demonstration of changed behavior, just receipt of new information (like a training course that has no impact on actual behavior back at work)
|Level 1 learning||
Learning from a simple or single set of alternatives, as in skills-building for assertiveness training
|Level 2 learning||
Choosing which sets of learning to use for level 1 learning, as in bringing in new learning to support a business plan or culture change
Level 3 learning
Making a paradigm shift, as in the realization that we are all interconnected and our ‘enemies’ are aspects of ourselves that need integrating
Hawkins cogently argues that you cannot have effective Level 2 learning without the ability to step outside into Level 3 learning. It is an excellent article that has not aged with the passage of time. For our purposes, the key element in Hawkins’ paper is the call to step outside our current mindset, of adapting to changes, long enough to reassess our core purpose. Yes, we can be more effective and efficient and return more shareholder value, but what is the organization for? What difference would it make if we ceased to exist? What is our service? We need to adopt Level 3 learning in our choice of strategic mindsets in order to adopt a framework more befitting AI. Dan Saint’s article in the last part of the Ai Practitioner will address a few of these questions by arguing for a focus on the triple bottom line.
Despite Hawkins’ paper and the arguments for the triple bottom line, strategic writers and business schools still teach strategy based on a warfare mindset. We are still competing with each other for survival, and thereby endangering all our lives. It is time for a fundamental reassessment of the heart of strategy.
We need a mindset that works with the principles of AI - a strategic process that can interface seamlessly with our other AI work within organizations and communities. So what can a review of the key principles of AI reveal about the kind of strategic model we need?
The Implication of AI’s Eight Principles on Strategy
(Source: Principles applied from Whitney and Trostenbloom (2003). The Power of Appreciative Inquiry, pp. 54-55)
We propose beginning this reassessment with a review of eight key principles that underpin AI and how these principles influence our strategic mindset.1: The Constructionist Principle
Words Create Worlds
The way we encourage an organization to explore itself and its purpose is fateful. For this reason it is crucially important that we are choice-full about the strategic framework we adopt. If we carry on using a warfare mindset we know that we will be creating more fighting between organizations. If we choose an appreciative mind-set we will be creating more focus on what works best within organizations, between organizations and their communities, and environments.2: The Principle of Simultaneity
Inquiry Creates Change
Inquiry is itself intervention. Even if we have helpful models and frameworks, our focus still needs to be steered towards that which we most want to create. The very first questions asked are fateful. Any action, movement or sound will create a simultaneous re-action. Too many business leaders seem to focus their strategy on fending off the competition or avoiding going into debt. Our task is to help them re-focus on what it is they really want to create for themselves, their community, and their environment. One way into this arena is to help them ensure that their business dream is truly aligned with their personal values and vision.
Appreciative Strategy lends itself to focusing on a value-based, rather than a fear-based, world: a world where there is abundance and we give ourselves permission to follow our hearts and focus on our vocation – the service that we truly want to bring to the world. In this world we can earn enough to live the life we want to lead.
As we move towards the expected shift in global consciousness around 2012 we need organization and business leaders to be in the vanguard of those who recognize that, since they create their reality, they can live their dreams to the fullest. “The best way to predict the future is to create it” as stated in Peter Drucker’s work.
3: The Poetic Principle
We Can Choose What We Study
An organization’s story is constantly being co-authored. Stories have a powerful impact on the organization’s life together. Narrative approaches to strategy are based on story telling. Stories are told both as the strategy is formulated and as a means of communicating the newly formed strategy. Story telling results in strategies that are understood and discussed throughout the organization, making them much easier to implement. Narrative approaches lend themselves to involving wider groups in strategic debate, ensuring a fuller involvement of staff and other agencies in our strategic process.4: The Anticipatory Principle
Image Inspires Action
No organization exists without there having first been someone holding a vision of what it might achieve. We move towards our shared projection of our shared future. New paradigm organizations are likely to make far more rapid progress if they are pulled towards a positive vision of their future than if they are pushed by a fear of what might happen. Many current business strategies are focused on escaping a current or feared predicament, for example loss of market share, patent or a competitive advantage.
Our strategic process needs to harness the power of anticipation and ensure that strategies are developed to bring about visions which stakeholders genuinely want to see come into being.5: The Positive Principle
Positive Questions Lead to Positive Change
The more positive the questions used to guide a group of people, the more long-lasting and effective the change effort tends to be. Our strategic focus therefore has to be unconditionally positive. We will be encouraging our clients to reach for the stars and work from their highest selves and moments. This principle helps to shape the positive core.6: The Wholeness Principle
Wholeness Brings Out the Best
By bringing all stakeholders together in a large group format to assess the current strategic posture, explore strengths and market opportunities, to design strategy, and create strategic plans, it is clear that everyone has a voice (an insight) in the creation of strategy. Using a whole systems approach to strategy planning stimulates creativity and builds individual, organizational and multi-organizational capacity.7: The Enactment Principle
Acting “As If” Is Self-Fulfilling
As Mahatma Gandhi said: “Be the change you want to see in the world.” Positive change occurs when the process used to create the change is enacted. This is the transformational change discussed earlier in strategic thinking. To achieve the most preferred future, live your strategy in the present. The AI approach creates moments for organizational stakeholders to enact their dreams, management and leadership styles.8: The Free Choice Principle
Free Choice Liberates Power
People perform better and are more committed when they are invited openly into the process with the freedom to choose how and what they would like to contribute. Free choice is at the heart of the work of management consultant Jane Seiling (1997):
The term membership indicates that members choose to work in the organization. This implies free choice - members voluntarily join and stay in the organization. The concept of freedom of choice eliminates the member’s sense of helplessness and hopelessness and enhances the new psychological contract between the member and the organization. The victim mentality of the past disappears when membership by choice prevails. (pg. 6)
Thus, freedom to choose results in positive change and organizational excellence. As a result of the AI principles and its application to strategy, what surfaces is a holistic approach to strategy. Our work has to make sense in the wider interconnectedness of the global village. Strategy needs to work at the level of people, planet and prosperity, often referred to as the Triple Bottom Line. If we are appreciative of ourselves, our colleagues and organization we may naturally extend that philosophy to our surroundings. We are likely to want to encourage organizations to work in a way that enhances their organizational members, local community, and environment.
We can no longer afford the short-term thinking of making a fast buck and harming the earth in the process. Tearing down irreplaceable rainforest to make paper pulp for milk and juice cartons is akin to sawing off the branch we are sitting on. Triple bottom line businesses are beginning to make the case that they have a stronger and viable financial future than those who just focus on economic return. Ethical pension funds are attracting more investment than before. The Washington Post for May 25th, 2003, reported that U.S. investors took $13 billion out of conventional mutual funds and put $185 million into funds with assets deemed ethically or environmentally responsible. The paper noted that the number of ‘ethical’ funds is growing rapidly and four now have assets of more than $1 billion. Another growth sector is social venture capital. Bridges Community Ventures, in the United Kingdom (UK), with part government - part venture capital backing has a fund of £40m and will use venture capital expertise to support entrepreneurs in some of England’s most economically deprived areas. Also in the UK, the FTSE4Good ethical indices have shown their teeth by expelling seven companies from the FTSE for failing to meet environmental criteria.
Business leaders are already aware of the cost of a bad press around Corporate Social Responsibility. The consequences for organizations that are not socially responsible are relatively obvious; however, we have yet to prove the positive side of the argument – that adopting triple bottom line strategies actually ramps up profit or build more robust income streams.
What Might Appreciative Strategy look like?
In this section we pulled together our current ‘field book’ of practical ideas on Appreciative Strategy. Starting with our working definition we move on to explore the focus, facilitation questions, and language we believe Appreciative Strategy will evoke. Finally, we offer two models that we have found helpful in our work. The field book is far from complete and has the rough and ready feel of ‘work-in-progress’. We warmly encourage feedback on how these ideas work in practice. Please e-mail either of the authors with stories of what has worked best in your strategic work, so that we can build a more comprehensive field book for the future.
Strategy in the corporate context is the “how”. It is the action the organization takes to reach its vision and serve its mission while achieving the goals and objectives defined within a master plan. Strategy in the appreciative context is the iterative process of working out how we are going to do what we really want to do, in a way that is enriching and sustainable for our stakeholders.
Appreciative Strategy, based on the AI principles and holistic approach to strategy, is likely to look like some form of ‘conscious evolution’ (Marx Hubbard, 1998). Organizational leaders and consultants who adopt this approach will probably be those who already take responsibility for the world they create around themselves, not only within their organization but also within their communities and environment. They will be part of the emerging paradigm, based on the premise that ‘what you believe is what you see’, as opposed to the current paradigm, based on the premise of ‘what you see is what you believe’ (Rinaldo Brutoco, President of the World Business Academy and Gill Edwards, 1991, author of Living Magically). As a consequence, Appreciative Strategy is likely to be aligned with notions of sustainable economy and creating value for stakeholders. It will also be strongly vision-focused, i.e. a heliotropic movement towards a desired outcome, as opposed to the warfare mindset of being driven by a desire to escape from a current predicament.
One practical outcome of this focus is likely to be a desire to balance competitive advantage with collaborative advantage. In the corporate context, competitive advantage deals at the business unit level of strategy and the question is asked, “how to compete in an industry”? Michael Porter (1980 and 1985) provides principles and techniques for analyzing, creating and sustain superior competitive advantages. His work is useful because he brings in three fundamental questions:
1) Where are we now?
2) Where do we want to go?
3) How do we get there?
The principles and practice of AI tend to encourage collaboration, rather than competition. There is often collaboration, for example, between AI practitioners. In our work with client organizations we are also likely to encourage collaboration between them and their staff, suppliers, customers, and even, where appropriate, other organizations in the same sector. Collaborative advantage is not new and many organizations already work on collaborative strategies. However, it has not received the same amount of focus as competitive advantage.
In our view, we need a balance of both collaborative and competitive advantage to maximize strategic effectiveness. Only using competitive advantage means we focus on some of the things we want to avoid, for example the threat from other organizations and the fear of loss of market share. Our Constructionist Principle warns us against making too much use of this approach.
For an example of Collaborative Advantage we would point to the work of the Yeo Valley Organic Company, in England. Their strategy is to work in active partnership with the farmers, who supply the organic milk they depend on to produce their range of organic yogurts. They provide three-year purchase agreements that guarantee farmers a fixed price for their milk and increasing volumes of sales. They have also introduced a bonus scheme that gives farmers a direct share in Yeo Valley’s success and growth. In 1999 the scheme paid out £100k to local farmers. The collaborative advantage is that Yeo Valley has a stable supply of organic milk and farmers can afford to convert to organic methods, knowing they have a viable business going forward. Everyone succeeds. More details are available on their website at http://www.yeovalley.co.uk.
Any strategic process has two key strands, deciding what to go for and working out how best to get there. They are sometimes a challenge because they are iterative, but it can be easier to think of them as distinct phases to facilitate discussion.
Strategic Element 1: Deciding what to go for
At the start of any AI work comes the question about what the client really wants to create. The work of Appreciative Strategy needs to cast a wider net than usual to answer the question. Some of the following questions could be explored:
¨ What do individuals in the organization really want to do? What is their purpose? Does it connect with organizational mission?
¨ What do they value about themselves, the people they work with and their organization and its other stakeholders?
¨ What is the organization fundamentally for – its mission, purpose? What difference would it make to anyone if the organization ceased to operate?
¨ What special skills, knowledge, product or service does this organization offer that will add value to customers, the community or environment?
¨ What is the niche or distinctive feature, its unique value offering? How might we grow a diverse range of income streams without losing this distinctiveness or focus?
¨ What is needed or desired right now, or might be needed or desired in the future, by those the organization seeks to serve? What is the potential market opportunity?
¨ What are the two to three most likely future scenarios that would have a big impact on the central work of this organization? What influence might we have on shaping our own future?
¨ What has our vision been for the last 5, 10, 15 years and how do we want to shape our emerging vision going forward?
¨ If we did nothing new, where would our current trajectory take us as an organization? Is that the future we want to co-create?
¨ If a commercial organization, what sort of quantum or value do we want to create – and why? What is it for? How much would be enough?
These questions can be used as an extended stakeholder analysis. They add some missing elements from typical current stakeholder analysis that underplays the importance of purpose and the triple bottom line.
Strategic Element 2: Deciding how to get there
A core component of any strategic process is the ability to learn from experience and dialogue with others as we gradually learn how to make our dreams a reality. The following questions can be explored:
¨ How do we need to modify our original thinking in the light of feedback from trying out the ideas in practice?
¨ What are we already good at and how can we build on this success? Why did some of these strategic elements go so well and what can we learn from who did what?
¨ How can we achieve our purpose and balance the triple bottom line?
¨ What legacy are we likely to leave for future generations?
¨ How can we best engage our employees in a strategic inquiry, imagination, innovation, and inspiration to achieve measurable results?
¨ What is our emerging narrative story and how can we communicate this to other stakeholders?
¨ How can we best engage key customers and suppliers in our strategic inquiry?
¨ Where could we form powerful synergies with partners whose interests are aligned with ours?
¨ How do we make the optimum use of our resources, in order to achieve our goals?
¨ What new ways of working will strengthen our core and distinctive (strategic) competencies?
¨ How might our culture need to evolve to support the work of our vision?
¨ When we break down our strategy into the key performance indicators, what needs to happen by when and who will be involved in each part?
¨ What process can be co-created for checking progress against the emerging plan?
¨ How will we best spot important changes in our environment that will require us to adapt our emerging strategy? How will we identify which of our scenarios is closest to the way the future unfolds?
These questions can be used to form an extended learning organization dialogue. They add more of an external focus on partners, the environment and future generations than most current learning organization models.
Based on the social constructionist principle, another fundamental assumption underlying AI is that the language one uses creates one’s reality. AI proposes an affirmative vocabulary for designing the preferred future (Cooperrider et al., 2003). By contrast to the military-like language of current models, the vocabulary of Appreciative Strategy is going to sound very different. Here are some of the terms likely to be used:
Ø World service
Ø Making a difference
Ø Dream / Vision
Ø Triple bottom line
Ø Strategic Inquiry
Ø Strategic Opportunities
Ø Positive Change
Ø Visions of possibilities
Ø Preferred Future
Ø Positive Macro trends
Ø Knowledge Sharing
Ø Business Ecosystem
Ø Appreciative Intent
Appreciative strategy truly begins with the appreciative images and languages.
Two Emerging Strategic Models
Some new models are likely to be re-writes of existing ones. Sutherland’s (2003) re-working of the classic SWOT analysis uses AI principles to clarify how well an organization is progressing towards its overall purpose and how it might work with partners (community, environment and other organizations) to further its development.
One model starts by initiating a dialogue on Purpose. It replaces ‘Weaknesses’ with an inquiry into Progress already made. It then imagines the Potential we might achieve, given our progress to date and the environment we find ourselves working in. Finally it replaces the notion of ‘Threats’ with a question about how we best relate to others as Partners? In so doing it encourages us to be choice-full about those we cast as competitors or collaborators.
Table 2: Sutherland’s 4 Ps of Appreciative Strategy
What we really want to do?
What are we already doing well?
What is possible for us?
How shall we work with others?
The other emerging model, by Stavros, Cooperrider and Kelley (2003), transforms the SWOT model into SOAR (strengths, opportunities, aspirations, results) and can liberate us to focus on what really matters: the future of our people and organization. With more than a process methodology, the AI strategist writes the questions of inquiry to shape the direction of the strategic planning process and inform the content based on its strengths and opportunities. This is what we call a strategic inquiry with an appreciative intent.
Table 3: Strategic Inquiry with Appreciative Intent: Inspiration to SOAR!
What are our greatest assets
What are the best possible market opportunities
What is our preferred future
What are the measurable results
The SOAR approach to strategy starts with a strategic inquiry. During this inquiry, an organization’s greatest Strengths and Opportunities are discovered and explored among the participants with an appreciative intent. The participants are invited to articulate their Aspirations and co-construct their strategies. Then, recognition and reward programs are design to inspire employees to achieve measurable Results.
Throughout this edition of the AI practitioner you will find case studies and vignettes that offer many further practical ideas on working appreciatively with strategy.
We have been on a long journey from the battlefield to the boardroom. What have we learned?
The Heart of Appreciative Strategy
The heart of Appreciative Strategy is in applying AI principles to strategic assessment, formulation, planning, and processes. Developing strategy that is fundamentally positive can take some getting used to, when we are so familiar with more traditional approaches. We therefore have to be mindful of the many ways in which the prevalent warfare mindset can take us off course and point us towards avoiding threats and combating fears. We will also find ourselves working with many leaders and managers who are steeped in the current mindset and automatically reach for a SWOT analysis.
Our first task is to be alert and choice-full about the mindset we adopt. We need to match the mindset to our client’s purpose. If they are seeking to work in partnership with others, and with the environment, they are likely to feel hampered by the current warfare mindset and its focus on scarcity and competition.
Our second task is, by contrast, to appreciate all that the existing warfare mindset has achieved to date, so that we can learn from where it has worked at its best. We will want, for example, to balance competitive advantage with collaborative advantage, not replace one with the other. Competitive advantage has produced some wonderful developments in medicine and industry.
Our third task is to develop a range of practical strategic tools that can be used routinely by AI practitioners and managers alike. These will eventually find their way into the textbooks of future MBA students.
The fourth task is to practice strategic humility, the practice of knowing when you don’t know something. With the appreciative approach to strategy, if you don’t know something then rely upon the wisdom, skills, and experiences of others in exercising judgement (DeGennaro, 2003). Be humble and do a strategic inquiry with an appreciative intent to find the best answers.
When you stop and ask people what they really want to see in the world they talk about peace, social justice, full employment and an effective home/life balance. Placing appreciation at the heart of our strategy will help us in achieving those inspiration aims.
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