The Art of Strategy: Assessments

1. How to assess, prepare and shape

Erik Schön
Jan 3, 2019 · 12 min read
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Photo: Katrina Gilmour

What is strategy? Why do you need it? How do you do it? And, how can you be more certain to succeed?
The Art of Strategy provides timeless answers to these eternal questions. It is a modern reading of Sun Tzu’s Art of War using the lenses of strategists John Boyd and Simon Wardley ().(All parts; Other reading and viewing formats)

Sun Tzu

Strategy is vitally important for organizations:
a place for creation or destruction;
a path to success or failure;
a matter to be carefully considered.

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Fundamental Factors of Strategy: Illustration: Simon Wardley ( CC BY-SA 4.0)

Use the following fundamental factors of when strategizing:

  1. Purpose
  2. Landscape
  3. Climate
  4. Doctrine
  5. Leadership

Purpose keeps people united, supporting each other without fear through success and failure.

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道 (Dào) Purpose. Calligraphy © Hisayo Oki

Landscape is the environment including positions, distances, space and obstacles.

Climate is the forces acting on the environment including the patterns of the seasons and stakeholders’ actions.

Doctrine is ways of operating, organizing and communicating that apply irrespective of landscape and climate.

Leadership is actions, decisions, choices and gameplays based on purpose, landscape, climate, doctrine and capabilities — guided by wisdom, trust, compassion, courage and strictness.

Master all five to succeed; or else, fail.

When assessing conditions and making comparisons, ask:
Who has more influential purpose?
Who has more skilled leadership?
Who is favored by landscape and climate?
Who carries out doctrine more skillfully?
Who has more capabilities?
Who has more highly trained people?
Who provides feedback more clearly?
This shows who will succeed and who will fail.

Attract and retain people who use these factors and be certain to succeed. Dismiss people who do not, or be certain to fail.

Based on assessments, develop a strategy for advantageous momentum beyond the regular. Advantageous momentum comes from conditions tilting the scales in our favour.

Deploying strategy is about shaping:
when able, seem unable;
when busy, seem idle;
when near, seem far;
when far, seem near.
When competition is greedy, lure them;
when disordered, advance;
when well-ordered, prepare;
when strong, avoid;
when angry, disturb;
when relaxed, harry;
when united, divide.

Engage when competition is unprepared; appear in unexpected places.

That is how to succeed; it can only fully be known afterwards.

Careful assessments indicate success, careless assessments indicate failure.

Many advantages indicate success, few indicate failure;
if no advantages at all, how much greater the indication of failure.

This is how to determine success or failure before engagement starts.

Boyd

From A Discourse on Winning and Losing and The Essence of Winning and Losing.

Strategy
Strategy is a mental tapestry of changing intentions for harmonizing and focusing our efforts as a basis for realizing some aim or purpose in an unfolding and often unforeseen world of many bewildering events and many contending interests.

The purpose of strategy is to improve our ability to shape and adapt to unfolding circumstances, so that we (as individuals or as groups or as a culture or as a nation-state) can survive on our own terms.

Purpose
For success over the long haul … one needs some unifying vision that can be used to attract the uncommitted as well as pump-up friendly resolve and drive and drain-away or subvert adversary resolve and drive … what is needed is:

A vision rooted in human nature so noble, so attractive that it not only attracts the uncommitted and magnifies the spirit and strength of its adherent, but also undermines the dedication and determination of any competitors or adversaries …

A grand ideal, overarching theme, or noble philosophy that represents a coherent paradigm within which individuals as well as societies can shape and adapt to unfolding circumstances — yet offers a way to expose flaws of competing or adversary systems.

Observe — Orient — Decide — Act
Observe — orient — decide — act (OODA Loop) more inconspicuously, more quickly, and with more irregularity as basis to keep or gain initiative as well as shape and shift main effort: to repeatedly and unexpectedly penetrate vulnerabilities and weaknesses exposed by that effort or other effort(s) that tie-up, divert, or drain-away adversary attention (and strength) elsewhere.

The second O, orientation — as the repository of our genetic heritage, cultural tradition, and previous experiences — is the most important part of the
O — O — D — A loop since it shapes the way we observe, the way we decide, the way we act.

Orientation is an interactive process of many-sided implicit cross-referencing projections, empathies, correlations, and rejections that is shaped by and shapes the interplay of genetic heritage, cultural tradition, previous experiences, and unfolding circumstances.

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OODA “Loop” (Observe — Orient — Decide — Act ). Illustration: John Boyd, The Essence of Winning and Losing

Without our genetic heritage, cultural traditions, and previous experiences, we do not possess an implicit repertoire of psycho-physical skills shaped by environments and changes that we have previously experienced.

Without analysis and synthesis across a variety of domains or across a variety of competing independent channels of information, we cannot evolve a new repertoire to deal with unfamiliar phenomena or unforeseen change.

Without a many-sided implicit cross referencing process of projection, empathy, correlation, and rejection (across many different domains or channels of information), we cannot even do analysis and synthesis.

Without OODA Loops, we can neither sense, hence observe, thereby collect a variety of information for the above process, nor decide as well as implement actions in accord with these processes.

Or, put another way, without OODA Loops embracing all the above and without the ability to get inside other OODA Loops (or other environments), we will find it impossible to comprehend, shape, adapt to, and in turn be shaped by an unfolding, evolving reality that is uncertain, ever changing, and unpredictable.

By pulling all this together, we can see that the key statements, OODA loop sketch, and related insights represent an evolving, open-ended, far-from-equilibrium process of self-organization, emergence, and natural selection.

Wardley

From Wardley Maps.

Strategy
The art of manipulating an environment to gain a desirable outcome.

Strategy is a game of position and movement played using the Strategy Cycle.

(1) Start with the purpose of the game at hand and be prepared to adjust it as the game unfolds.

(2) Then, observe the game by looking at the landscape using a Wardley Map and climatic patterns.

A map is visual, context specific, shows position and movement, and, has an anchor (e.g. north).

A Wardley Map visually shows the evolution of a context specific value chain using position and movement of components — with stakeholder needs as the anchor. The components of the map also have a stage of evolution:

  • Genesis. This represents the unique, the very rare, the uncertain, the constantly changing and the newly discovered. Our focus is on exploration.
  • Custom built. This represents the very uncommon and that which we are still learning about. It is individually made and tailored for a specific environment. It is bespoke. It frequently changes. It is an artisan skill. You wouldn’t expect to see two of these that are the same. Our focus is on learning and our craft.
  • Product (including rental). This represent the increasingly common, the manufactured through a repeatable process, the more defined, the better understood. Change becomes slower here. Whilst there exists differentiation particularly in the early stages there is increasing stability and sameness. You will often see many of the same product. Our focus is on refining and improving.
  • Commodity (including utility). This represents scale and volume operations of production, the highly standardized, the defined, the fixed, the undifferentiated, the fit for a specific known purpose and repetition, repetition and more repetition. Our focus is on ruthless removal of deviation, on industrialization, and operational efficiency. With time we become habituated to the act, it is increasingly less visible and we often forget it’s even there.

This evolution is shown as the x-axis and all the components on the map are moving from left to right driven by supply and demand competition. In other words, the map is not static but fluid and as components evolve they become more commodity like.

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Example of a Wardley Map. Illustration: Simon Wardley (, CC BY-SA 4.0)

A climatic pattern is a common economic pattern that affect all players. These are the rules of the context specific game at hand, and, together with landscape, helps anticipate change: skate to where the puck is going to be, not where it has been.

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Examples of Climatic Patterns. Illustration: Simon Wardley (, CC BY-SA 4.0)

(3) Next, orient yourself using doctrine. A doctrine is a universally applicable principle giving you a potential choice to improve your situation— and ultimately win — the game.

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Examples of Doctrine. Illustration: Simon Wardley (, CC BY-SA 4.0)

(4) After this, decide what specific actions to take to improve your situation and ultimately win the game based on the potential choices found during observation and orientation using a map of the landscape, climatic patterns, universal doctrine, and, gameplays. A gameplay is a context specific choice that depends on components’ position on the map.

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Example of Gameplay. Illustration: Simon Wardley (, CC BY-SA 4.0)

(5) Finally, act, and then repeat the strategy cycle remembering that there are two types of “why”:

  • the “why” of purpose: the chess master wants to win every chess game.
  • the “why” of movement: the chess master moves the queen to gain a better position on the chessboard.
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The Strategy Cycle. Illustration: Simon Wardley (, CC BY-SA 4.0)

Also, remember that one action is to change the direction of the organization — to alter its purpose: start as a paper mill, then evolve via rubber boots, TVs and PCs into a telecommunication company.

Climatic Patterns for Components
Everything evolves through supply and demand competition. If the conditions exist that a person or groups of people will strive to gain some form of advantage or control over others due to a constraint (i.e. a limitation of a resource or time or money or people) then we have competition. If competition exists then the components effected will evolve until they become industrialized. This impacts everything from activities (what we do), practices (how we do something), data (how we measure something) to knowledge (how we understand something). The map is never static but dynamic. It’s also important to understand that if competition exists then you will be in conflict with others. Sometimes the best way of resolving this is through coopetition (i.e. cooperative competition) and building alliances. In other cases, depending upon the context, then you have to fight even to the point of a game of last man standing. In any significant landscape then you’re likely to find yourself building alliances on one part of the map whilst at the same time fighting other companies in another and withdrawing from a third. However as the components on your map evolve then your former allies can become foes and vice versa. Microsoft and open source used to be mortal enemies, they’re now often found to be best buddies. To manage such a dynamic and fluid environment then you’re going to need to be able to observe it.

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Climatic Pattern: Everything evolves. Illustration: Simon Wardley (, CC BY-SA 4.0)

Characteristics change as components evolve. The characteristics of a component in the uncharted space are not the same as the characteristics of the same component when it becomes industrialized. In any large system then you’re likely to have components at different ends of the evolution scale. This leads to the Salaman & Storey Innovation paradox of 2002 i.e. the need to innovate requires polar opposite capabilities to the need to be efficient. However, a word to the wise, a company has to manage both the extremes along with the evolution between them. It’s really important to remember that there is a transition from uncharted to industrialized. Don’t organize by the extremes alone.

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Climatic Pattern: Characteristics change. Illustration: Simon Wardley (, CC BY-SA 4.0)

Doctrine for Strategy
Strategy is complex. There will be uncertainty, emerging patterns and surprises along the way. That’s the very nature of competition due to the involvement of other actors. Embrace this, don’t fall for the temptation that you can plan the future. What matters is not the plan but the preparation and your ability to adapt.

Strategy is iterative, not linear. Understand that strategy is iterative. You need to adapt in fast cycles according to the changing environment. The best you can hope for is a direction, a constant process of learning and improvement of your gameplay along the way.

Bias towards action. Do not attempt to create the perfect map. Have a bias towards action because the landscape will change and you will discover more through action. You learn by playing the game.

Doctrine for Assessments
Focus on high situational awareness. There is a reasonably strong correlation between situational awareness — our level of understanding of context (purpose and landscape), and, how context is changing — and business performance, so focus on this. Try to understand the landscape that you are competing in and understand any proposals in terms of this. Look before you leap.

Use a common language. A necessity for effective collaboration is a common language. Maps allow many people with different aptitudes (e.g. marketing, operations, finance and IT) to work together in order to create a common understanding. Collaboration without a common language is just noise before failure.

Be transparent. Have a bias towards openness within your organization. Sharing a map will enable others to challenge and question your assumptions. This is essential because it helps us to learn and refine our maps. The downside of sharing is it allows others to challenge and question your assumptions. Many people find this uncomfortable. Don’t underestimate how difficult this transparency is within an organization.

Challenge assumptions. Maps allow for assumptions to be visually exposed. You should encourage challenge to any map with a focus on creating a better map and a better understanding. Don’t be afraid of challenge, there is no place for ego if you want to learn.

Gameplays for Shaping

  • Disposal of liability: overcoming the internal inertia to disposal. Your own organization is likely to fight you even when you’re trying to get rid of the toxic.
  • Sweat & Dump: exploiting a 3rd party to take over operating the toxic asset whilst you prepare to remove yourself.
  • Pig in a poke: a mechanism of dressing up a liability as some form of future business before divesting to a third party.
  • Misdirection: sending false signals to competitors or future competitors including investment focused on the wrong direction.
  • Signal distortion: exploiting commonly used signals in the market by manipulation of analysts to create a perception of change.
  • Creating artificial needs: creating and elevating an artificial need through marketing and behavioral influence. Take a rock and make it a pet etc.
  • Confusion of choice: preventing users from making rational decisions by overwhelming them with choice.
  • Artificial competition: creating two competing bodies to become the focus of competition and in effect driving oxygen out of a market.

The Art of Strategy: All Parts

Contents: A very short summary of each part
Introduction: What is strategy and why do you need it?

  1. Assessments: How to assess, prepare and shape
  2. Challenges: How to use and reduce inertia, entropy and friction
  3. Success: How to succeed together with stakeholders
  4. Setup: How to create resilience
  5. Momentum: How to use creativity focus and timing
  6. Shaping: How to shape and avoid being shaped
  7. Engagement: How to engage using surprise
  8. Adaptations: How to adapt to shifting situations
  9. Movements: How to move to optimize momentum
  10. Landscape: How to approach difficult areas
  11. Situations: How to handle difficult situations
  12. Disruption: How to disrupt and avoid being disrupted
  13. Intelligence: How to use intelligence to create foreknowledge

Annex: Wardley Mapping Examples
Glossary: Explanation of key terms and symbols
Acknowledgements: Standing on the shoulders of giants
Sources: Where to learn more
Other reading and viewing formats

This is provided as Creative Commons Attribution-ShareAlike 4.0 International by the author, .

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