Why Is Strategy So Hard to Understand?
Strategy may be one of the most frequently used and least consistently understood words in business. Business schools teach it, consulting firms sell it, boards approve it, executives hold strategy retreats, and organizations build entire functions around it. Yet ask a group of experienced executives, academics, or consultants a seemingly straightforward question, "What is strategy?", and the answers can quickly diverge.
Some will describe a vision for the future. Others will talk about goals, priorities, competitive advantage, market positioning, growth, innovation, or execution. Most of these ideas belong somewhere in a serious discussion about strategy, but none, by itself, fully explains what strategy is. Even experienced practitioners can return to the foundational works of strategy and discover that ideas they thought they understood contain considerably more depth than they remembered.
Perhaps strategy is difficult to understand because genuine strategy asks organizations to do something inherently difficult. It requires them to understand their situation deeply, diagnose the important problem or opportunity, make choices in the face of uncertainty, accept trade-offs, and create coherence among the activities required to make those choices work. That is considerably more demanding than producing a plan.
When Strategy Becomes Strategic Planning
Most organizations need a strategic plan. They need to establish objectives, allocate resources, coordinate initiatives, assign responsibilities, establish measures, and determine what needs to happen over the coming years. These are legitimate and necessary management activities. The problem begins when the strategic plan and the strategy itself become indistinguishable.
A typical strategic planning process might establish a vision and mission, confirm organizational values, identify strategic priorities, develop objectives, attach KPIs, and create initiatives and timelines. The resulting document can be thoughtful and valuable. It may still leave an important question unanswered: what is the strategy?
Consider an organization whose strategic priorities are to grow revenue, improve the customer experience, develop its people, increase operational efficiency, and innovate for the future. Each is desirable. Collectively, however, they say little about how the organization intends to succeed. They do not tell us which customers it will serve, what distinctive value it will create, what position it is trying to establish, what it will do differently, what it has decided not to pursue, or why those choices should produce better performance.
Roger Martin has written directly about this distinction. In The Big Lie of Strategic Planning, he argues that planning feels more comfortable because much of it concerns activities and expenditures an organization controls. Strategy is different because it forces leaders to make choices about an uncertain future and about customers and competitors they cannot control. Richard Rumelt makes a related, but distinct, argument. He has observed that many corporate strategic plans are essentially multi-year resource budgets and projections. Rumelt does not dismiss planning; his concern is the assumption that a planning exercise necessarily produces a coherent strategy simply because it is called strategic planning.
Strategic planning is therefore not the enemy of strategy, nor is implementation less important than strategic thinking. They perform different jobs. Strategy establishes the choices and logic through which an organization expects to succeed. Planning and implementation organize the actions, resources, responsibilities, and measures required to bring those choices to life.
Why the Great Strategy Thinkers Are Harder Than They Look
Part of strategy's difficulty becomes apparent when we return to three influential thinkers: Michael Porter, Roger Martin, and Richard Rumelt. Their approaches overlap, but they should not be collapsed into a single theory. Each emphasizes a different part of the strategy problem.
Michael Porter's contribution begins with competition and positioning. In his 1996 Harvard Business Review article What Is Strategy?, Porter distinguishes operational effectiveness from strategy. Organizations should improve productivity, quality, technology, and management practices, but becoming better at performing the same activities as competitors is not the same as having a strategy. Porter argues that strategy requires a unique and valuable competitive position supported by a different set of activities. He also emphasizes trade-offs and fit: organizations must choose what not to do, and their activities must reinforce one another as a system.
For Porter, these choices are ultimately connected to superior performance. Strategy is not simply about being different. It is about establishing a distinctive competitive position and configuring activities in a way that allows the organization to outperform rivals over time. This is more demanding than declaring that a company is differentiated. It requires decisions about which customers or needs to serve, what distinctive value to provide, how activities will differ, and how the activity system supports the position.
Roger Martin approaches the challenge through choice. In Playing to Win, written with A.G. Lafley, strategy is organized around five interconnected choices: the organization's winning aspiration, where it will play, how it will win, the capabilities it requires, and the management systems needed to support those choices. "Where will we play?" and "How will we win?" sound simple, but applying them requires decisions about markets, customers, products, channels, capabilities, and the logic of why customers will choose the organization over alternatives. The choices must also reinforce one another.
Rumelt starts somewhere different again. In Good Strategy/Bad Strategy, he argues that good strategy begins by confronting a consequential challenge. His strategy kernel consists of a diagnosis, a guiding policy for addressing the challenge, and coherent actions that carry out that policy. He contrasts this with the substitution of slogans, broad ambitions, financial goals, and vague statements for an actual response to a difficult problem.
There is overlap among these thinkers, but it is important not to overstate it. Porter gives us competitive positioning, trade-offs, activities, fit, and superior performance. Martin gives us a practical way to think about strategy as a system of integrated choices, including where to play and how to win. Rumelt directs attention to diagnosis, the challenge, guiding policy, and coherent action. Bringing these perspectives together into a broader approach to strategy is a synthesis, not a definition directly offered by any one of them.
Reading Strategy Is Not the Same as Understanding Strategy
One of the humbling experiences of studying strategy is returning to a well-known work after several years of practical experience. A sentence that seemed straightforward on the first reading can take on considerably more meaning after watching a leadership team struggle with a real strategic decision.
Porter's idea of fit is a good example. At first glance, fit can sound like organizational alignment. His argument goes further: activities should reinforce one another in ways that strengthen the strategic position and make the complete system more difficult for competitors to imitate. Strategy therefore does not reside in one excellent capability or isolated source of differentiation. The strength may arise from the interaction among many choices and activities.
Martin's where-to-play and how-to-win choices create a similar challenge. A leadership team can answer both questions in an afternoon, but that does not mean it has a strategy. "We will win through great customer service," for example, says little until the organization can explain which customers value that service, what it means in practice, what capabilities make it possible, what competitors offer instead, and why the proposition should change customer behaviour.
Rumelt's emphasis on diagnosis can sound equally obvious, yet organizations frequently move quickly towards priorities and initiatives before fully understanding the situation those initiatives are supposed to address. Reading strategy is therefore different from understanding strategy, and understanding strategy is different again from practising it. Application requires evidence, judgement, and experience.
Strategy Begins With Understanding the Problem
Organizations understandably want to discuss the future: which markets to enter, where growth should come from, what priorities to establish, and which initiatives to launch. These questions may be premature if the organization has not first established what is actually happening.
A serious diagnosis may require understanding industry economics, customer needs and behaviours, competitor positions, sources of profitability, organizational capabilities, operational constraints, leadership assumptions, and changes in the external environment. Internal realities also matter. Culture, decision-making, incentives, structure, and leadership behaviour can all affect which strategic choices are plausible.
This broader point is a Cohesive Strategy Group synthesis rather than a claim made specifically by Porter, Martin, or Rumelt. Rumelt provides the strongest foundation through his emphasis on diagnosis. Porter provides tools for understanding competition, positioning, activities, and the sources of superior performance. Martin provides a system for converting understanding into integrated choices. Taken together, they reinforce an important discipline: understand the situation before prescribing the solution.
Consider an organization that sets a goal of growing revenue by 20 per cent over three years. That is an aspiration, not yet a strategy. Investigation might reveal that its historical product advantage has disappeared, competitors have matched its offering, customers perceive little meaningful difference between suppliers, and the sales organization is increasingly competing on price. The organization could then choose to focus on a customer segment whose operational needs it understands unusually well, redesign its service model around those needs, build specialist capabilities, and stop pursuing low-value transactional business.
Whether that strategy would succeed still requires evidence and testing, but there is now a logic connecting the diagnosis to a set of choices. Because we understand this about our situation, we will make these choices, which we believe will allow the organization to succeed for these reasons. Without that connection, strategy risks becoming a collection of attractive initiatives searching for a problem to solve.
Frameworks Are Tools, Not Strategy
Strategy has accumulated an extensive toolkit: Five Forces, value-chain analysis, SWOT, PESTEL, VRIO, customer segmentation, competitor mapping, growth matrices, and many others. Each can help leaders see part of a problem more clearly. The danger arises when completing the framework is confused with creating the strategy.
Five Forces can help an organization understand the structural forces affecting competition and profitability. A value-chain analysis can illuminate how activities contribute to cost or differentiation. Customer research can reveal unmet needs, while competitor analysis can expose differences in positioning. But none of these tools makes the strategic decision. A leadership team can complete excellent analysis and still have no strategy.
Frameworks organize thinking. Strategy requires leaders to interpret what the analysis means, determine which insights matter, make choices, and connect those choices into a coherent approach. Frameworks are teachable, repeatable, and create visible outputs. Strategy is less mechanical. Eventually, analysis must give way to judgement.
The Difficulty of Choice and Trade-Offs
Most organizations do not struggle to identify things they would like to accomplish. They want growth, innovation, operational excellence, strong customer relationships, employee engagement, improved margins, new markets, better technology, and greater efficiency. The difficulty is deciding which ambitions should shape the organization and which must remain secondary.
This is where Porter's emphasis on trade-offs becomes particularly important. A strategic position becomes difficult to sustain if an organization attempts to satisfy every customer, every need, and every opportunity. Different value propositions can require incompatible activities, cost structures, capabilities, or behaviours. For Porter, these trade-offs help protect a distinctive position and contribute to the conditions required for superior performance.
Martin reaches a similar practical difficulty through choice. Choosing where to play means there are places the organization has not chosen to play. Choosing how to win establishes a particular logic rather than leaving every path open. Porter and Martin are not making the same argument, but the practical synthesis is useful: a strategy becomes more credible when leaders can state not only what they have chosen, but what those choices require them not to pursue.
Strategic planning can sometimes disguise this problem by accommodating nearly every ambition. Instead of choosing, another pillar is added. Instead of reallocating resources, another initiative is launched. The plan becomes larger while the strategy becomes less clear.
Strategy and Implementation Are Different Disciplines
Once strategic choices have been made, an organization faces another demanding task: converting them into action. Strategy and implementation are deeply connected, but they perform different jobs. Strategy addresses the logic of how an organization intends to succeed. Implementation determines how the organization will organize itself to make that logic real.
A strategy might establish the customers or stakeholders the organization will prioritize, the distinctive value it intends to create, the activities and capabilities required to deliver that value, and the trade-offs it is prepared to accept. The implementation plan then translates those choices into initiatives, milestones, responsibilities, resources, KPIs, budgets, processes, and operating rhythms.
This distinction is Cohesive Strategy Group's interpretation of how the disciplines should be managed. It is informed by Porter's focus on activities and fit, Martin's connection between choices, capabilities, and management systems, and Rumelt's requirement for coherent action. A strategy without implementation remains largely an idea. An implementation plan without strategy can produce coordinated activity without a clear explanation of why that activity should allow the organization to succeed.
So, What Is Strategy?
After working through Porter, Martin, and Rumelt, we return to the deceptively simple question. Porter directs us towards a unique and valuable competitive position, deliberate trade-offs, fit among activities, and ultimately superior performance. Martin directs us towards integrated choices about where to play and how to win, supported by capabilities and management systems. Rumelt directs us towards diagnosis, guiding policy, and coherent action.
No single sentence can capture the full body of work behind these ideas, but organizations still need language they can use. Our synthesis at Cohesive Strategy Group is:
Strategy is an integrated set of choices about where an organization will play, how it will create distinctive value and succeed, what it will deliberately not do, and how its activities will work together to reinforce those choices.
The wording is deliberate. Integrated matters because isolated choices do not constitute a strategy. Choices matter because goals and ambitions alone do not establish direction. Distinctive value provides a reason for customers, stakeholders, funders, members, or other constituents to choose, support, or engage with the organization. What we will not do matters because strategy requires focus and trade-offs. The activities must then work together so that the strategy is expressed through what the organization actually does.
The word succeed is equally deliberate. Porter's work is grounded in competition and the pursuit of superior economic performance, which is the appropriate terminology when describing his theory. Cohesive Strategy Group works with both commercial and mission-driven organizations, where success may mean superior economic performance, greater mission impact, reach, effectiveness, or sustainability. Similarly, Martin's "how to win" should remain his terminology when discussing his framework, while CSG uses the broader question of how an organization intends to succeed.
Over time, we have made strategy easier to communicate by reducing it to priorities, pillars, goals, and planning templates. Those tools help organizations manage complexity, but when the simplification goes too far, strategy can come to mean almost anything considered important. That may explain the experience of reading a beautifully designed strategic plan and struggling to find the strategy within it.
The missing element is often the underlying argument: what have we understood about our situation, what choices have we made because of that understanding, what have we chosen not to do, and why should the resulting system allow this organization to succeed?
Strategy is not mysterious, but it is not merely a plan. It is a demanding discipline of understanding, diagnosis, choice, trade-offs, and coherence. Strategic planning organizes the path forward, while implementation turns that path into action. Perhaps becoming better at strategy begins with enough humility to keep asking whether the work we are calling strategy is actually strategy at all.