There is no difference between an effective, long-term strategy and an ethical course of action. It’s only the pressure of time, a lack of imagination, and our narrowness of perspective—in other words, our in-built limitations as human beings—that makes them appear different.
The Best Strategy – Framing Our Question
The best strategy for a firm—whether its a for-profit business or a non-profit organization—begins and ends with a simple question: How can we thrive?
The simplicity of this question is deceptive. During the process of strategic planning, we need to take apart and reassemble this question rigorously. So, let’s break this little question apart:
- Who is “we”?
If we’re a for-profit business, the question has just a few possible answers. We could answer “our shareholders”. Or “our corporation”. Or “our stakeholders”. Of course, if we answer “our stakeholders”, we also have to decide who those stakeholders are—and aren’t. And we have to decide if some of those stakeholders should have a higher priority in our planning than others.
If we’re a non-profit, answering who “we” are can be much more difficult to agree on. By their nature, the boundaries of non-profits are often less well-defined than those of a business.
- What do we mean by “thrive”?
Do we want to maximize short-term profit? Maximize share price? Maximize long-term firm value? Provide good jobs? Have lots of satisfied customers? Contribute to our community?
The criteria for “thrive” are rarely simple. And, instead of looking for the “right” answer, it’s often best to choose an answer—to decide. If your business is facing financial difficulties, it may be time to seek the help of a licensed insolvency practitioner. If you’re unfamiliar to what they do, you can find Insolvency Practitioner Explained here.
- “Can” focuses us on the future.
The fact that we might have thrived in the past is only relevant to strategic planning insofar as it affects our future. This is often difficult for people involved in strategic planning to accept. As human beings, we derive much of the meaning in our lives from what has happened to us—and we have done—in the past. For firms (both for-profit and non-profit) their meaning and value comes from what they can do in the future.
- “Can” reminds us that we’re not dealing with certainty.
We’re trying to predict the likely effects of possible actions we might take.
- “How” reminds us we’re focused on actions.
Strategic planning is not focused on who we are, but on what we do. What are the possible actions open to us? How capable are we of actually taking those actions? How likely are they each of them to lead to the thriving outcome we want?
Strategic planning, then, is a disciplined process of questioning. There are tools we can use to answer those questions, and you’ll find a few of those outlined here. But these tools are not, in themselves, strategic planning. They are routes to a goal.
And the goal is always a serious, believable, and successful answer to that core question: How can we thrive?
Where are the ethics?
One of the benefits of beginning and ending with the question of how we can thrive is that it integrates ethics with strategy.
When we decide who the “we” is of our firm, we are making an ethical choice. When we decide who is included in “we”, we are inevitably deciding who is excluded. And once we are sure we have drawn that boundary accurately and ethically, we have to decide what role (if any) should the various components of “we” have in creating our strategic plan. That, too, is an ethical choice.
When we wrestle with what we mean by “thrive”, were are engaged in an ethical discussion. It pushes us to clarify what we value most. And it pushes us to ask if our thriving comes at the expense of some unaccounted harm.
And when we talk about “how”, we inevitably find ourselves asking about the ethics of our actions. Our actions reveal who we are. Is this a course of action we can be proud of? If we take this course, will we become the firm we want to be?