Understanding, clarifying and assigning strategic versus tactical decision making is key in business.
I almost want to say “Duh, really?”
There appears to be an imbalance in strategic vs. tactical thinkers: around 90% of leaders or managers are tactical and only about 10% are strategic. Let’s define strategic and tactical decision making in simple terms:
- Tactical leaders and managers are like firefighters. They seem to thrive on running around fighting the little fires that crop up in their businesses or divisions.Tactical decisions are short term, narrowly focused, and should be, but are most often not, made with the long term view in mind.
- Strategic leaders and managers are fire preventive. They are good at looking to the future and seeing the implications of moves and minimizing the risk of a fire starting. And if or when a fire does start, they fight it based on the long view of the company. In some cases, they may choose not to fight a fire and just let it burn itself out. Strategic decisions are based on the ‘higher level’, ‘big picture’ and ‘long term’ views and objectives.
- Where the Strategy and Tactics meet: Improving the organizations capacity to survive and thrive. Strategists need to get the long view right and share that view with the tacticians. And vice-versa.
- When the tacticians know what the long term view is, they are better able to choose which fires to fight, how to fight them, and help prevent fires in the future.
- When the strategists listen to and understand the tacticians they get a ‘boots on the ground’ view of areas of possible flare-ups and can make decisions to prevent them. They can answer questions such as “Are we capable of handling that flare up?”
How can a business plan help with Strategies vs. Tactics?
Look at the diagram below. It is a ‘mind-map’ of decisions a business owner was struggling with. He wasn’t really trying to micro-manage per-se, but his mind kept going to all of the things he felt he needed to attended to. I let him wander around in his head and kept notes of his path. It was a maze of thoughts and ideas, traps and blocks, creativity and opportunities. What kept him from moving forward was that he was almost always in firefighting mode. A big part of why he was in firefighting mode was that all of these paths represent another option, another choice he had to make. And as I have said before, too many options create indecision.
What management should be focused on
When managements focus swings to each fire, the entire organization swings wildly and randomly
The center highlighted area is the big picture focus that management needs to focus on. The higher up the manager is in the food chain, the narrower that box gets. Notice the North arrow? That represents the direction the management is focused on. All of the little fingers reaching out? They are in alignment with and being carried along true north.
When the decision making box is wider the map is nowhere near as neat. The wider the box of decision making, the more likely the arrow is to swing back and forth as management focuses on fire after fire almost randomly. And that is how the entire organization will move – randomly.
Interestingly, just as I finished drafting this post a friend sent me this link to a video on YouTube where millionaire Sam Silverstein talks about thinking strategically.
I have written a series based on live work with a clients’ permission to talk in general terms about the process and the numbers. Here are links to the series of articles. I will make them ‘live’ as the posts are uploaded.
- Return On Investment (ROI) In Writing A Business Plan – Pt. 1
- Return On Investment (ROI) In Writing A Business Plan – Pt. 2
- Tactical vs. Strategic Decisions – Return On Investment (ROI) In Writing A Business Plan – Pt. 3
- The Bottom Line – Return On Investment (ROI) In Writing A Business Plan – Pt. 4
Be sure to subscribe to the RSS feeds so you get the next article in this series.
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When the decision making box is wider the map is nowhere near as neat.
I get what you mean about the wider the frame the further away on the map we become.
Great read, and thanks for the cross link Bart
Bart, this is one of the best explanations that I have read about the difference between strategy and tactics. I am now teaching a management strategy course to business school undergraduate seniors. With your permission, I would like to provide them a link to your blog. Many of them are out in the work world and could benefit from your pragmatic thinking. Many thanks. Marcia
@Marcia
Thank you so much for reading and commenting, and certainly pass the link on.