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How do good strategists think and what does it mean to “be strategic”?   Is there an art to being strategic and strategic thinking, or can it be learnt?  it is clear to us that being strategic requires three core pieces. For many successful strategists, being strategic means working on the system, not in it.

Being strategic is the ability to work on the system, not in it.

One characteristic we see good strategic thinkers doing is that they work on the system rather than in the system.

A good way to think about this is a simple technique I use in strategy presentations.  I have a cardboard box which I place in the middle of the floor.  If it is big enough I jump in and out of the box.  Planning is working inside the constraints of that box.  Strategy is being outside the box and observing it in its wider context.  This includes choosing where to place the box, what size the box is, what type of box it is and how it fits in the landscape.

Being outside the box means looking at the wider system

Being strategic requires you stepping outside the box and look at the wider system.  It means looking at the governing variables: what constrains the box and determines its position.  In learning terms, it is about the second order thinking.

Being strategic means working on the systems

However, at this point there is a trick.  You see the box is on the floor of a room.  That room is itself a box.  Being strategic is realising that there are constraints in the choice and shape of the room.  It goes wider than this.  The choice of the building in which the room is situated. What we have are nested systems.  Each one of those systems can be influenced or changed or exploited.

For instance, a company that is operating in an industry, is also operating in a country and within a tax and governance regime.  There may be choices about which industry to be in, and choices about the country and governance regimes, as well as simply, the shape and location of the box in the landscape of the room.

Strategy is about understanding these embedded systems: the boxes within boxes and the constraints and opportunities that each level of box brings.

The ability to turn ideas into action.