Operating in a world where the competitive landscape is ever more ephemeral, challenges to the status quo ever more profound, and the life of a successful business model ever shorter, aligning a corporation’s strategic intent and strategic action becomes ever more critical. The more dynamic the industry, the shorter the duration such alignment is likely to be. As intent and action become misaligned, that divergence creates what Andy Grove termed “strategic dissonance” in a California Management Review article he co-authored as well as his 1996 book Only the Paranoid Survive.
Arriving at a point of strategic dissonance suggests that the incumbent strategy no longer works as the underlying market and competitive dynamics have shifted enough to require a new strategy. Grove termed these “strategic inflection points” to describe the giving way of one type of industry dynamics for another. Strategic inflection points signal fundamental change in a business and require a new strategy, a modified business model, and a change in the way business is conducted. The driver might be new technology, new regulations, emergent competition, or any structural dynamic that obviates the current environment.
The challenge for anyone, management or otherwise, is to recognize the strategic dissonance and, more importantly, to perceive the opportunity being created by the strategic inflection point and requisite new strategy.
Recognition that the changing nature of the enterprise’s operating environment is a true strategic inflection point occurs in stages:
- Initially, identifying and articulating the existence of strategic dissonance – the growing divergence between what the company views as its strategy and the actual actions of its management team.
- Then, confirming and accepting that the new set of circumstances is indeed a strategic inflection point that will require changes to the old way of business.
- Finally, understanding the new strategic priorities, creating a framework for overcoming the strategic dissonance, and formulating a new strategic intent.
To manage through the envelope of strategic dissonance that is driven by the emergence of a true strategic inflection point requires the management insight and discipline to see that during this period of transformation, both the old and new basis of competition, distinctive competencies, strategies, and strategic actions will need to coexist.
That is a distinctive competency in and of itself.