Wednesday, September 21, 2011

Bullet Point Fodder*

Some strategy-related thoughts.

It has been said that Principle determines Strategy which in turn determines Tactics. Yes and No, I think. Better I think to phrase it as: Principle modifies the relative value placed upon the available Strategies, which in turn influence the valuation of the Tactics to be selected among. It isn't quite as straightforward as the first aphorism makes it seem. Strategy isn't determined only by what is acceptable or desirable to the strategist, but also by what the various allies expect/require as well, and all parties are ever subject to the demands of circumstance. Tactics are boring since they don't really change, there are only three basic options anyway: defend, attack or avoid. Admittedly there are several options within each of these but they aren't mysterious either; tactical surprise is achieved through successful misdirection of an opponent as to one's immediate intention(s). Rommel knew exactly what Eisenhower was going to do and had covered all the options quite well. Students of history are aware of the role Patton played as Ike's misdirection of Rommel's preparatory concentration.

Jobs, and Presidential policies to create them, are much in the news in recent months. The influence on employment that presidents or state's governors policies can have is more akin to the influence Principle has on Tactics, I think. There is a link, of course, but it's so indirect that it's essentially impossible to determine a specific tactical outcome from a given policy/principle statement prior to the event. What any leader must do is delineate the boundaries within which all must participate (or suffer "the consequences") as well as to ensure that transgression is swiftly and publicly rebuked. Beyond that, any attempt to influence individual Strategies that conform to the general principle(s) defined serves only to inhibit action being taken at all - IOW, remedial tinkering with policy to influence results inhibits normal market activity due to uncertainty as to boundary placement and infringement enforcement. Opportunity always entails risk, but an uncertain policy principle increases the degree of risk unmeasurably which results in depressed market activity and increased unemployment.

The more extensive a business structure is, the more important it becomes for close adherence to the precepts of classical Strategy. If the CEO is "the Prince", then the corporation division heads are most closely akin to the role of "the General". The CEO coordinates the individual contributions by each of the Generals separate "army" toward achieving the agreed-upon strategy of the corporation. While attention must be paid to the methods utilized by each "army", once again the degree of influence a CEO has over the tactics chosen by a division's subsidiary department is just as ill-defined as a president's is at a national level.

I think most American companies would benefit from a deliberate policy of devolution of authority so long as the corporate statement of principles made clear the limits and the degree of responsibility such authority conferred (read: imposed) upon the individual. It's a very different corporate culture that has a department shift team leader (commonly, an hourly employee selected to coordinate his immediate colleagues activities during the course of a work shift) determining work schedule fulfillment priorities based upon the logistical realities of the circumstantial moment as opposed to the do whatever is necessary to make the scheduled production target regardless of circumstance that is more usually the norm today. The latter results in production runs of defective product and inventory stocking levels that don't reflect current market demands for only two examples. The former requires a more intuitive grasp of the corporation's strategic environment at a much greater depth than is currently the case. It is also fair to say that the latter business model inflicts a much greater false sense of control and understanding than does the former.

Enough for now, and just my view from the factory floor anyway. What do I know?

* An inside joke just for us insiders. ;-)

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