We are entering the age of the strategist.

As our colleagues Chris

Bradley, Lowell Bryan, and Sven Smit have explained in Managing
the strategy journey (on mckinseyquarterly.com), a powerful means
of coping with todays more volatile environment is increasing the
time a companys top team spends on strategy. Involving more
senior leaders in strategic dialogue makes it easier to stay ahead of
emerging opportunities, respond quickly to unexpected threats,
and make timely decisions.
TIIs Is u sIgnIhcunL cIunge. AL u good number oI compunIes, corporuLe
sLruLegy Ius Iong represenLed LIe bIund uggreguLIon oI sLruLegIes
LIuL IndIvIduuI busIness unIL Ieuds puL Iorwurd.
1
AL oLIers, IL`s been
LIe domuIn oI u smuII coLerIe, perIups Ied by u cIIeI sLruLegIsL wIo
is protective of his or her domainor the exclusive territory of a CEO.
Rure Is LIe compuny, LIougI, wIere uII members oI LIe Lop Leum
have well-developed strategic muscles. Some executives reach
LIe C-suILe becuuse oI IuncLIonuI experLIse, wIIIe oLIers, IncIudIng
Becoming more
strategic: Three tips for
any executive
You dont need a formal strategy role
to help shape your organizations strategic
direction. Start by moving beyond
frameworks and communicating in a
more engaging way.
Michael Birshan and Jayanti Kar
1
n u McKInsey GIobuI Survey oI more LIun z,ooo gIobuI execuLIves, onIy one-LIIrd
agreed that their corporate strategy approach represented a distinct exercise that
specIhcuIIy uddresses corporuLe-IeveI sLruLegy, porLIoIIo composILIon Issues. or deLuIIs,
see CreuLIng more vuIue wILI corporuLe sLruLegy: McKInsey GIobuI Survey resuILs,
mckInseyquurLerIy.com, Junuury zo11.
J U LY 2 0 12
S T R A T E G Y P R A C T I C E
z
busIness unIL Ieuds und even some CEOs, ure mucI sLronger on
execution than on strategic thinking. In some companies, that very
Issue Ius gIven rIse Lo LIe posILIon oI cIIeI sLruLegy oIhcer-yeL
even u number oI execuLIves pIuyIng LIIs roIe dIscIosed Lo us, In u serIes
of interviews we conducted over the past year, that they didnt feel
adequately prepared for it.
This article draws on those interviews, as well as our own and our
colleagues experience working with numerous executives developing
strategies, adapting planning approaches, and running strategy
cupubIIILy-buIIdIng progrums. We oIIer LIree LIps LIuL uny execuLIve
cun ucL on Lo become more sLruLegIc. TIey muy sound decepLIveIy
sImpIe, buL our InLervIews und experIence suggesL LIuL LIey represenL
foundational skills for any strategist and that putting them into
prucLIce requIres reuI work. We`ve uIso LrIed, LIrougI exumpIes, Lo
present practical ways of acting on each suggestion and to show
Iow doIng so oILen meuns uugmenLIng experIence-bused InsLIncLs
with fresh perspectives.
Understand what strategy really means in
your industry
By the time executives have reached the upper echelons of a com-
puny, uImosL uII oI LIem Iuve been exposed Lo u seL oI core sLruLegy
frameworks, whether in an MBA or executive education program,
corporuLe LruInIng sessIons, or on LIe job. PurL oI LIe power oI LIese
Irumeworks Is LIuL LIey cun be uppIIed Lo uny IndusLry.
BuL LIuL`s uIso purL oI LIe probIem. GeneruI Ideus cun be mIsIeudIng,
und us sLruLegy becomes LIe domuIn oI u brouder group oI execu-
tives, more will also need to learn to think strategically in their partic-
ular industry context. It is not enough to do so at the time of a
major strategy review. Because strategy is a journey, executives need
to study, understand, and internalize the economics, psychology,
and laws of their industries, so that context can guide them continually.
or exumpIe, beIng ubIe Lo LIInk sLruLegIcuIIy In LIe IIgI-LecI
industry involves a nuanced understanding of strategy topics such as
network effects, platforms, and standards. In the utilities
sector, it involves mastery of the economic implications of (and
1
3
room Ior sLruLegIc muneuvers uIIorded by) LIe reguIuLory regIme.
In mining, leaders must understand the strategic implications of cost
curves, game theory, and real-options valuation; further, they
musL know und be sensILIve Lo LIe sLukeIoIders In LIeIr reguIuLory und
socIeLuI envIronmenL, muny oI wIom cun dIrecLIy Inuence LIeIr
opportunities to create value.
There is a rich and specialized literature on strategy in particular
IndusLrIes LIuL muny execuLIves wIII hnd IeIpIuI.
z
Tailored executive
educuLIon courses cun uIso be benehcIuI. We know orgunIzuLIons
that have taken management teams off-site to focus not on setting
sLruLegy buL on deepenIng LIeIr undersLundIng oI Iow Lo be u
sLruLegIsL In LIeIr IndusLrIes. or exumpIe, one ruw-muLerIuIs pIuyer
headquartered in Europe took its full leadership team to Asia
for a week, in hopes of shaking up the teams thinking. Executives
expIored In depLI zo Lrends LIuL wouId sIupe LIe IndusLry over
LIe nexL decude, dIscussIng boLI LIe Lrends LIemseIves und LIeIr ImpII-
cations for the supply of and demand for the organizations products.
3

They also looked across their industrys full value chain to under-
stand who was making money and whyand how the trends would
cIunge LIuL. A number oI LIe execuLIves In LIe dIscussIon were
surprIsed by Iow mucI vuIue cerLuIn specIuIIzed InLermedIurIes were
cupLurIng und oLIers by Iow LIe orgunIzuLIon wus IosIng ouL Lo
compeLILors LIuL were hnuncIng reLuIIers Lo IoId LIeIr InvenLory. TIe
executive team emerged with a clearer appreciation of where the
opportunities were in its industry and with ideas to capture them.
BuIIdIng LIIs kInd oI IndusLry undersLundIng sIouId be un ongoIng
process noL jusL becuuse we IIve In un eru oI more dynumIc
management
4
buL uIso becuuse oI LIe psycIoIogy oI LIe IndIvIduuI.
ExperIence-bused InsLIncLs ubouL LIe wuy LIIngs work IeuvIIy
Inuence uII oI us, mukIng IL Iurd, wILIouL sysLemuLIc eIIorL, Lo Luke
advantage of emerging strategic insights or the real lessons of an
IndusLry`s IIsLory. Wur gumes or oLIer experIenLIuI exercIses ure one
z
See, for example, Carl Shapiro and Hal R. Varian, Information Rules: A Strategic Guide
to the Network Economy (Hurvurd BusIness RevIew Press, November 1qq8), wIIcI
Iocuses on InIormuLIon busInesses, sucI us soILwure.
3
or more on Lrend unuIysIs, see PeLer BIsson, EIIzubeLI SLepIenson, und S. PuLrIck
VIguerIe, GIobuI Iorces: An InLroducLIon, mckInseyquurLerIy.com, June zo1o; und
IIIpe Burbosu, DumIun HuLLIngI, und MIcIueI KIoss, AppIyIng gIobuI Lrends: A Iook uL
CIInu`s uuLo IndusLry, mckInseyquurLerIy.com, JuIy zo1o.
4
See oweII Bryun, DynumIc munugemenL: BeLLer decIsIons In uncerLuIn LImes,
mckInseyquurLerIy.com, December zo1o.
4
way executives can help themselves to look at their industry
landscape from a new vantage point.
5
Become expert at identifying potential
disrupters
Expanding the group of executives engaged in strategic dialogue
sIouId boosL LIe odds oI IdenLIIyIng compuny- or IndusLry-dIsrupLIng
changes that are just over the horizonthe sorts of changes that
muke or breuk compunIes.
But those insights dont emerge magically. Consider, for example,
LecInoIogIcuI dIsrupLIon. or muny execuLIves, LIe rIse up LIe corpo-
rate ladder requires a deep understanding of industry-specific
LecInoIogIes-LIose embedded In u compuny`s producLs, Ior exumpIe,
or In munuIucLurIng LecInIques-buL mucI Iess knowIedge oI
cross-cutting technology trends, such as the impact of sensors and
LIe burgeonIng nLerneL oI TIIngs.
6
Moreover, many senior exec-
uLIves ure Iuppy Lo deIeguLe LIInkIng ubouL sucI LecInoIogy Issues Lo
LIeIr compuny`s cIIeI InIormuLIon oIhcer or cIIeI LecInoIogy oIhcer.
Yet its exactly such cross-cutting trends that are most likely to upend
vuIue cIuIns, LrunsIorm IndusLrIes, und drumuLIcuIIy sIIIL prohL
pools and competitive advantage.
So what to do? Some executives choose to spend a week or two visiting
u LecInoIogy Iub, sucI us SIIIcon VuIIey, Lo meeL compunIes,
InvesLors, und ucudemIcs. OLIers usk u more LecInopIIIe member oI
LIe Leum Lo keep ubreusL oI LIe Issues und brIeI LIem perIodIcuIIy.
We know u number oI execuLIves wIo Iuve deveIoped reverse men-
toring relationships with younger and more junior colleagues (or
even their children) that focus on technology and innovation. And of
course, LIere`s no subsLILuLe Ior seeIng wIuL your cusLomers ure
doing with technology: during several store visits, an executive at a
buby cure reLuIIer suw moLIers compure LIe prIces oI producLs on
LIeIr smurLpIones uL LIe sLore und Ieuve II LIey couId geL u beLLer deuI
eIsewIere. TIe sLore vIsILs brougIL Iome Iow modern moLIers
2
5
See JoIn Horn, PIuyIng wur gumes Lo wIn, mckInseyquurLerIy.com, MurcI zo11.
6
See MIcIueI CIuI, Murkus Ier, und Roger RoberLs, TIe nLerneL oI TIIngs,
mckInseyquurLerIy.com, MurcI zo1o.
5
reseurcI LIeIr buyIng decIsIons, LIe InLerucLIon beLween mobIIe
technology and store visits, and the importance of advertising a
prIce-muLcIIng scIeme Lo keep LecI-suvvy cusLomers buyIng In sLores.
NuscenL compeLILors ure unoLIer eusy-Lo-overIook source oI dIsrupLIon.
Senior strategic thinkers are of course well aware of the need to
keep an eye on the competition, and many companies have roles or
teams focused on competitor intelligence. However, in our experi-
ence, often too many resourcesincluding mental energyare devoted
to following the activities of long-standing competitors rather
than less conventional ones that may pose an equivalent (or greater)
strategic threat.
or exumpIe, suppose you ure un execuLIve uL un oII compuny wILI
assets in the UK Continental Shelf. It is natural for the competitors
LIuL you meeL reguIurIy uL bourd meeLIngs oI OII & Gus UK, LIe regIonuI
IndusLry ussocIuLIon, Lo be more Lop oI mInd LIun AsIun pIuyers
LIuL Iuve onIy jusL ucquIred LIeIr hrsL posILIons In LIe regIon. And
thats exactly why many long-standing industry leaders were sur-
prIsed wIen Koreu NuLIonuI OII CorporuLIon (KNOC), SouLI Koreu`s
nuLIonuI oII compuny, cIIncIed u IosLIIe Lukeover oI Dunu PeLroIeum
In IuLe zo1o, In wIuL wus Lo be LIe IurgesL oII und gus LrunsucLIon
in the United Kingdom in several years. The transaction was a har-
bInger oI IuLure InvesLmenLs by Iess LrudILIonuI pIuyers In LIe NorLI
Sea oil and gas industry. Similar dynamics prevail in mining: developed-
worId mujors (sucI us AngIo AmerIcun, BHP BIIIILon, und RIo TInLo),
wIIcI Iuve Iong compeLed wILI one unoLIer gIobuIIy, now musL uIso
take into account players from Brazil, China, India, and elsewhere.
PIckIng up weuk compeLILIve sIgnuIs Is more oILen LIun noL u resuIL
of careful practice: a systematic updating of competitive insights
as an ongoing part of existing strategic processes.
7
Executives with
dIverse buckgrounds cun boosL LIe quuIILy oI dIuIogue by conLrIbuLIng
Lo-und InsIsLIng on-Issue-bused compeLILIve unuIyses. WIo Is
weII-posILIoned Lo pIuy In emergIng busIness ureus? I new LecInoIogIes
ure InvoIved, wIuL ure LIey, und wIo eIse mIgIL musLer LIem? WIo
seems poorly positioned, and what does that mean for competitive
buIunce In LIe IndusLry or Ior ucquIsILIon opporLunILIes? ocusIng
competitive reviews on questions like these often yields insights of
sIgnIhcunLIy greuLer vuIue LIun wouId be possIbIe LIrougI LIe more
7
See Hugh Courtney, John T. Horn, and Jayanti Kar, Getting into your competitors
Ieud, mckInseyquurLerIy.com, ebruury zooq.
6
common prucLIce oI perIodIcuIIy exumInIng compeLILors` hnuncIuI
and operating results. It also helps push the senior team away from
linear, deterministic thinking and toward a more contingent,
scenurIo-bused mInd-seL LIuL`s beLLer suILed Lo Loduy`s IusL-movIng
strategy environment.
Develop communications that can break
through
A more adaptive strategy-development process places a premium on
effective communications from all the executives participating.
TIe sLruLegy journey modeI descrIbed by our coIIeugues, Ior exumpIe,
involves meeting for two to four hours every week or two to discuss
sLruLegy LopIcs und requIres eucI execuLIve LukIng purL Lo ug Issues
und Ieud LIe dIscussIon ubouL LIem.
n sucI un envIronmenL, LIme spenL IookIng Ior beLLer, more Inno-
vative ways to communicate strategyto make strategic insights cut
through the day-to-day morass of information that any executive
receivesis rarely wasted. This requires discipline, as it is always
tempting to invest in further analysis so that the executive has a deeper
grasp of the issues rather than in communications design to ensure
that everybody Ius u good grusp oI LIem. L uIso muy requIre buIIdIng
new skIIIs; Indeed, deveIopIng messuges LIuL cun breuk LIrougI
LIe cIuLLer Is becomIng u requIred skIII Ior LIe modern sLruLegIsL.
8
ExperIenLIuI exercIses ure one wuy oI boosLIng LIe eIIecLIveness oI
strategic communications within a top team. A strategist we know at
a shoe manufacturer wanted to illustrate the point that many of
IIs compuny`s producLs were boLI unuLLrucLIve und expensIve. He
sLurLed wILI u Lwo-by-Lwo muLrIx. So Iur, so predIcLubIe. BuL IIs
muLrIx wus buIIL usIng muskIng Lupe on LIe IIoor oI LIe execuLIve
suite, and the shoes were real ones from the company and its com-
petitors. His colleagues had to classify the shoes right there and
thenand he made his point. Similarly, we know another strategist
3
8
SLunIord UnIversILy busIness scIooI proIessor CIIp HeuLI und IIs couuLIor und broLIer,
Dun HeuLI, descrIbe sucI messuges us sLIcky Ideus LIuL peopIe undersLund und
remember und LIuL cIunge someLIIng ubouL LIe wuy LIey LIInk or ucL. SLIcky Ideus
have at least some of these six characteristics: simplicity, unexpectedness, concreteness,
credIbIIILy, emoLIon, und LIe ubIIILy Lo LeII u sLory. or more, see enny T. Mendoncu
and Matt Miller, Crafting a message that sticks: An interview with Chip Heath,
mckInseyquurLerIy.com, November zoo;; und CIIp HeuLI und Dun HeuLI, Made to Stick:
Why Some Ideas Survive and Others Die, New York, NY: Rundom House, Junuury zoo;.
7
wIo spenL un uILernoon cuLLIng LIe IubeIs oII sumpIes oI men`s boxer
sIorLs. SIe wunLed LIe bourd members Lo puL LIem In order oI
price so they could see how their perceptions of quality were driven
by brunds und noL munuIucLurIng sLundurds.
We wouId udd LIuL us sLruLegy becomes more oI u reuI-LIme journey,
IL`s ImporLunL Lo hgure ouL wuys Lo supporL dIscussIons wILI duLu
LIuL`s engugIng und eusy Lo munIpuIuLe. To LIe exLenL possIbIe, exec-
uLIves need Lo be ubIe Lo pusI on duLu und ILs ImpIIcuLIons In LIe
moment, instead of raising questions and then waiting two weeks
Ior u Leum oI unuIysLs Lo come buck wILI unswers. deuIIy, In IucL,
anyone in a room could drill into thoughtfully visualized data with
LIe Ick oI u hnger on u LubIeL compuLer. TIe proIIIeruLIon oI Luc-
LIIe mobIIe devIces und new soILwure LooIs LIuL IeIp muke spreudsIeeLs
more visual and interactive should facilitate more dynamic, data-
driven dialogue.
ExecuLIves IopIng Lo become more sLruLegIc sIouId Iook Ior oppor-
tunities to innovate in their communication of data, while prodding
LIeIr orgunIzuLIons Lo InsLILuLIonuIIze sucI cupubIIILIes. Breuk-
LIrougIs ubound-Iook no IurLIer LIun LIe InLerucLIve vIsuuIIzuLIons
in the New York Times in the United States or the Guardian in
LIe UnILed KIngdom; LIe zoo6 TED.com vIdeo Huns RosIIng sIows
LIe besL sLuLs you`ve ever seen; GeneruLIon Grownup`s InLerucLIve
LooI Nume Voyuger, wIIcI exumInes LIe popuIurILy oI buby numes
over LIme (see bubynumewIzurd.comJvoyuger); or KIvu.org`s
nLerconLInenLuI BuIIIsLIc MIcrohnunce vIsuuIIzuLIon oI Ioun-IundIng
und repuymenL ows. BuL Iew compunIes Iuve kepL up.
L`s noL enougI Lo Increuse LIe number und dIversILy oI execuLIves
engaged in setting strategy. Many of those leaders also must enhance
LIeIr own sLruLegIc cupubIIILIes. We Iope LIese LIree LIps IeIp LIem
get started.
The authors wish to thank Emma Parry for her contribution to the development
of this article.
Michael Birshan is a principal in McKinseys London office, where
Jayanti Kar is a consultant.
Copyright 2012 McKinsey & Company. All rights reserved.
We welcome your comments on this article. Please send them to
quarterly_comments@mckinsey.com.