What Does “Being Strategic” Actually Mean?

A client once asked, “What does being strategic actually mean?”

I paused for a second because I couldn’t give a straight answer. Afterward, I realized that I’ve never seen a good definition and that every time I’d heard it discussed, it was always as an abstract concept. 

So with a couple of days to reflect, here’s an attempt at an answer.

The first insight was that there’s a difference between being effective at strategy and being perceived as strategic.

Being effective at strategy is a bundle of activities. Things like: looking at the environment outside of the organization, thinking in a fundamental way about what drives value, orienting the organization to deliver upon those value drivers, and doing all of that in a continuous way. 

In my experience, the thing many leaders struggle with most—especially those who are on the cusp of the executive level—is carving out the time to focus on those activities. They’re caught in the magnetic pull of today’s challenges and what’s happening inside the organization, which prevents them from looking outside of the organization and at tomorrow’s challenges.

But it’s completely possible to be doing all that—to be effective at strategy—and still be perceived as not being strategic. So what might cause that gap between reality and perception?

Gap #1: Not communicating in a future-oriented way.

Imagine a monthly business review meeting. It’s easy for a report to focus exclusively on what happened in the past month. We produced 100,000 widgets, which is 3% more than we did last month.

If the report is detailed enough, others will know that the leader is on top of the execution, but the leader won’t get any points for being strategic because there’s no actual strategy in their communication. 

Put simply, the easiest fix is to make our presentations articulate the future—not just what will happen (e.g., the backlog, the project plan), but also how we’re thinking about the future. 

We produced 100,000 widgets. Based on what we learned by doing so, here’s what we’re going to do differently next month. And here are some risks that we’re actively monitoring.

Gap #2: Not explaining the WHY of the choices we’re making.

OK, you’ve given the future-oriented statement, so at least everyone knows that you’re thinking about improvement. 

But what’s often missing is the WHY. Why do you focus on that metric versus something else? Why did you pick those improvement initiatives versus others? 

Because we’re the ones closest to the business, it is easy to take for granted that others understand why we’re doing what we’re doing. Or we may take for granted that they will remember the strategy presentation we gave eight months ago when we told the story. 

Instead, the WHY needs to be ever-present. Pro tip: Having a compelling branding with your strategy can help others visualize and track the strategy through time. 

As you likely remember, our strategic theme is “Twice the Output, Half the Errors,” which should position the company to add a second product line next year. In that light, the 100,000 widgets we produced last month indicates that [your analysis]. And it’s driving us to focus on the following next month [your strategy].

Solving these first two gaps is really about making our strategic thinking obvious to others. If it’s all done in our heads—even if the business choices are “right”—there’s uncertainty about whether we’re good or just lucky. 

Gap #3: Not communicating in the language of their boss’s boss.

I had a chance to hear Ron Williams, the former CEO of Aetna, speak last week. He mentioned that he practiced a “two up, two down” strategy during his career. That is, he made sure that he always understood what his boss’s boss cared about and acted upon that. 

I think that’s a useful way of thinking about being strategic—it’s in the eye of the beholder. 

In that light, it’s not just thinking strategically and communicating strategically, it’s framing the strategy in a way that matters for those making that subjective assessment. It’s not just getting to the “right” answer, it’s convincing the boss’s boss that I’m thinking through the problem as they would. 

And that analysis can yield even more insights about what people really mean when they suggest that someone should be more strategic. 

For example, as a leader, I’m mostly focused on making my area of the business better and winning with my customers or markets. 

My boss’s boss is focused on every part of the business and all customers. 

So here, “Be more strategic” might be a substitute for “That all sounds good, but truly strategic initiatives are those that help everyone be more effective.”

I’m focused on improving a little bit, all the time. 

Because my boss’s boss has a bigger scope, a 10% improvement in 10% of their organization (what I lead) isn’t all that exciting. Here, “Be more strategic” might be a proxy for “Think bigger; bring me something that matters.”

I have my own logic for what matters, informed for my detailed, day-to-day understanding of the business. 

My boss’s boss has their own approach, likely more focused on the core fundamentals. Here, “Be more strategic” might be an indicator of “Yes, but that’s not what I care about.” 

These framings also suggest an approach to solving the gap—Just ask what leaders care about!