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I first used the phrase strategy by hope and magic when I was asked to review a ‘strategic plan’ for a client.  There were lots of statements about improved performance and lower costs.  However, when I searched for what would change and drive those changes… there was nothing.  Hence, strategy by hope and magic.

How to test for strategy by hope and magic

The 4 pen test is based on the cause and effect model of the strategy balanced scorecard’s strategy map. The core perspectives of the strategy map provide a cause and effect relationship.  Here you have a clear model of how learning and growth changes the organisation’s processes, which in turn, change things for the customer and ultimately affect the financial outcomes.  (You can read more about that her here and here).

The four pen test is looking for statements about these four perspectives in the strategy document.  It is looking for how the organisation’s capabilities will be changed so that the processes will be improved.  It is looking for statements of investment and action.

However many strategy document just say, “We will improve the skills so we get better” are so vague as to be meaningless.  What skills, with what investment.  And where specifically are these skills required?  And what is the size of the gap?  How are the skills changed?  Training?  Recruitment? Sitting next to Nellie? Who knows?

How to make sure you do not have strategy by hope and magic

Have a clear model of change in the organisation

Have a clear theory of change for how the organisation will influence the outside world.

I see strategy by hope and magic, when an organisation publishes a strategy or business planning document,