In Search of Excellent Strategy

The problem with strategy is that it’s often difficult to tell whether a strategy is good or bad. This is why 97.5% of strategies fail to deliver results. Many corporate strategies that appear solid on the surface are actually flawed in substance.

This problem persists because strategy is an abstract construct—intangible, invisible, with no immediate payback. It contends with hidden forces, shifting probabilities, and complex interdependencies. Unlike a physical object you can see or touch, strategy is not definitive and rarely provides a single, correct answer. It’s a complex mental feat that animals, for instance, are incapable of. They rely on instinct, a rudimental form of strategy granted by evolution, while humans must navigate this complexity using the power of their minds.

The Complexity of Strategy and the Lure of Shortcuts

Because strategy is complex, many leaders attempt to simplify it with shortcuts. However, these shortcuts often do more harm than good.

The First Shortcut: Overreliance on Strategy Frameworks

One of the most common shortcuts is overdependence on strategy frameworks. Consider the Seven Levers of Growth, which is often used to develop growth strategies. This framework suggests:

1. Increase sales from existing customers

2. Acquire new customers

3. Introduce new products or services

4. Enter new distribution channels

5. Move up or down the value chain

6. Expand geographically

7. Diversify into new business areas

Frameworks like this can be useful in providing a structured, big-picture view. They give you a broad understanding of what generally works—like how economies of scale are beneficial, network effects are powerful, and differentiation increases your chances of success.

But when it comes to practical application, most frameworks are too generic to be helpful. It’s like hiring a personal trainer to lose weight, and they tell you to:

1. Eat less

2. Drink more water

3. Exercise more

4. Sleep better

5. Be more mindful

While this advice is technically correct, it’s not actionable. For instance, how much water should you drink? Six cups? Ten? That depends on your current habits, environment, exercise routine, and health condition. Generic advice doesn’t account for these details, and neither do most strategy frameworks.

Similarly, strategy frameworks rarely provide clear guidance on specifics. Take Blue Ocean Strategy—the idea of winning by being different is great in theory, but it offers little help in figuring out what those differentiating factors should be. Porter’s Five Forces encourages you to consider industry dynamics, but doesn’t tell you how to strengthen your position. McKinsey’s 7S Framework highlights important organizational elements but fails to explain how to address them.

Furthermore, frameworks are often incomplete. For example, in the context of dieting, you might get solid advice about nutrition and exercise, but no mention of critical elements like building a support network, ensuring mental commitment, or developing new habits quickly.

This is understandable. Frameworks simplify reality, and in doing so, they often leave out crucial factors. In real life, though, there’s no separation between departments or functions. Strategy requires a leader to address all the complexities that interconnect finance, marketing, HR, operations, and more. A well-structured 2x2 matrix can’t capture the full scope of strategic thinking needed to address the challenges you face.

The Second Shortcut: Copying High Performers

Another common shortcut is copying the “best practices” of high-performing companies. For example, NVIDIA is currently thriving, and their strategy includes:

1. Focusing on AI and Data Center growth

2. Building world-class capability through their CUDA platform

3. Establishing strategic partnerships with cloud providers and hardware manufacturers

4. Investing heavily in R&D

5. Growing their core business while expanding into new sectors

This kind of strategy is highly detailed and appears to offer a clear path to success. Many consulting firms recommend benchmarking such best practices and applying them to your own business. They’ll even go as far as to analyze NVIDIA’s processes, KPIs, and organizational structure to provide a roadmap for you to follow.

But here’s the catch: copying high performers doesn’t always work. Let’s say you run a semiconductor company and decide to mimic NVIDIA’s strategy. The challenge is that you may not have NVIDIA’s economies of scale, brand power, or innovation capability. Just because their approach works for them doesn’t mean it will work for you.

It’s like a personal trainer advising you to follow the weight management regimen of Canelo Álvarez, a world-champion boxer. His strategy involves running 5–8 kilometers a day, doing 200-300 push-ups daily, eating 5–6 small meals, and consuming 3,000 calories daily. While that might be effective for a professional boxer, it’s unlikely to suit your needs if you’re simply trying to shed a few pounds and maintain a busy professional life. In short, what works for Álvarez won’t necessarily work for you, and the same holds true for copying corporate strategies.

The Reality of Strategy

What does all of this tell us about strategy? There are no shortcuts. There’s no silver bullet, no framework, and no set of best practices that will guarantee success. Strategy, by its very nature, requires hard work and a deep connection to reality.

Think of strategy as a battlefield, and you as the general (after all, the word strategy means “the art of the general). Just as Genghis Khan, Napoleon, and Alexander the Great led from the frontlines, you must immerse yourself in your business’s realities. You cannot strategize from a distance, relying solely on theory or secondhand data. To succeed, you must consider both the external landscape—your customers, competitors, market conditions—and your internal capabilities—your people, processes, and resources.

Only by connecting deeply to reality can you create an excellent strategy. Strategy isn’t a paper exercise, a checklist, or a framework-filling process. It’s not about being the smartest person in the room—it’s about understanding your customers, your competitors, your assets, and your challenges better than anyone else.

When you do the hard work of connecting with reality, the path forward becomes clear. You won’t need fancy PowerPoints, jargon, or complicated spreadsheets. You’ll intuitively see what needs to be done. Your strategy will evolve—it will be flexible, fluid, and adaptable to the ever-changing circumstances. And at that moment, you’ll know you’ve created an excellent strategy.