A good strategic discussion is central to achieving good discussions and real decisions that are embedded in the organisation. In this section, we present a methodology for ensuring good strategic discussions and describe why strategic discussions are often not as good as desired.

We live in a world where technology advances rapidly, spreading ideas, products, and services faster than ever before. Political and market changes that may seem distant can have a significant impact on one’s own business. In such an environment, strategic work is more crucial than ever. In the article series “Mastering Strategy”, we delve into the challenges related to strategic work and explore what defines a successful strategic process. In this section, we take a closer look at how to ensure good strategic discussions.

For the strategic discussion to be successful, it is important that the case presented is perceived as legitimate by everyone around the table. If it is not perceived as legitimate, the result will be a discussion about details in the documentation, and it will be difficult or impossible to have a real discussion about strategic choices.

The reasons why a case is not perceived as legitimate can vary. For example, someone who feels they should have been involved in the preparation of the case may not have been, or the case may be presented in such a way that it is unclear to meeting participants why the case should be discussed. For those who will be facilitating and participating in strategy processes, it may be useful to…

…ensure that everyone is involved in the preparation of the case
…know what management likes and cares about (procedural vs. conceptual, etc.)
…don’t focus too much on the details: management teams and the CEO are often less interested in discussions that don’t address real and concrete strategic choices.
…always clarify whether the matter is for discussion, information or decision.
…think through the subject before it comes up in the meeting. This may be particularly useful for some managers in support functions.

Discuss strategy over three time horizons

Another challenge in strategy work is that strategy discussions often become confused because the people around the table are working along different time horizons. It is therefore important to make the time perspective explicit. One way of doing this is to divide the discussion into the following categories:

Strategic direction is long term – answers to what and why you should be involved.
Strategic priorities are medium term – the answers to what and how to develop in the direction set.
Strategic implementation is within the next budget period – how should we deliver to achieve the goals set.

Decision biases and other causes of poor judgement in strategic discussions

Anyone who has participated in a strategic meeting knows that many things can go wrong. As the facilitator of the strategy process, it is important to be aware of these pitfalls, thereby increasing the likelihood of avoiding them.

Our judgement is impaired as we fall into various mental “traps”.
Decision biases, suboptimal incentives, and asymmetric information create a risk that the decision-maker does not always get the full picture.
This can lead to throwing good money after bad projects or hesitating to make a decision.
The “principal-agent” relationship is an important cause of decision biases
Other causes are linked to human limitations, risk aversion, time pressure, confirmation bias, among others.
Group dynamics, the desire for belonging and consensus pressure, as well as the authority of the CEO, can contribute to important objections, critical questions, or bad news failing to surface.
It is challenging to identify and implement measures to avoid many of these issues, but fostering good discussions is one way of correcting them.

We end this chapter with a quote from Warren Buffett:

“We only give a couple of instructions to people when they go working for us: One is to think like an owner. And the second is to tell us bad news immediately – because good news takes care of itself. We can take bad news, but we don´t like it late”.

Ensuring good strategic discussions is important for landing on a strategy. But deciding on a strategy is only the first part of the strategy process. A strategy also needs to be implemented.

In the next and final article in the series “Mastering Strategy”, we will take a closer look at how to move from words to action in the difficult process of strategy implementation.