Strategy Dynamics focuses on performance over time. The overarching objective of strategic management is to develop a sustainable approach to quantitatively improve performance through time.\u00a0 This can apply to the enterprise as a whole, or for a key functional areas (e.g. Sales, Human Resources, Product Development, etc.).<\/p>\n
Strategy Dynamics seeks to answer 3 key questions:<\/p>\n
- \n
- WHY<\/em>\u00a0is performance following its current path?<\/strong><\/li>\n<\/ol>\n
- \n
- WHERE<\/em>\u00a0will performance go if we continue as we are doing today?<\/strong><\/li>\n<\/ol>\n
- \n
- HOW<\/em> can we design a robust strategy to radically improve that performance into the future?<\/strong><\/li>\n<\/ol>\n
![\"dynamics\"](\"https:\/\/flevy.com\/blog\/wp-content\/uploads\/2017\/01\/dynamics.png\")
<\/a><\/p>\nThe application of Strategy Dynamics is essentially universal. \u00a0It can be used for every kind of enterprise, whether commercial, public-service, or voluntary, as well as to every corporate function within an organization.\u00a0 It is also applicable to not yet existing enterprises, such as new ventures or voluntary initiatives.<\/p>\n
Strategy Dynamics also has numerous benefits:<\/p>\n
- \n
- The method works for every kind of enterprise\u2014commercial, public-service, or voluntary\u2014as well as to every function within an enterprise.<\/li>\n<\/ul>\n
- \n
- It is also applicable to not yet existing enterprises, such as new ventures or voluntary initiatives.<\/li>\n<\/ul>\n
- \n
- The method is strongly evidence-based and rigorous, offering a solid understanding of what causes current performance and confidence in the future performance.<\/li>\n<\/ul>\n
- \n
- Being evidence-based, it can solve differences of opinion amongst team-members. It also allows each individual, both amongst the management team and in the wider organization beyond, to see where their activity contributes to the whole, and on whom they depend.<\/li>\n<\/ul>\n
- \n
- Since it highlights exactly where management actions and decisions exert control, it provides clear and specific strategies and action plans, that can be adapted as the future unfolds.<\/li>\n<\/ul>\n
- \n
- The method provides a solid foundation for methods such as the Balanced Scorecard and Value Based Management, and is a means of integrating other established strategy frameworks and approaches, such as PEST(EL)<\/a>, Core Competence<\/a>, and Value Chain Analysis<\/a>.<\/li>\n<\/ul>\nAre you a management consultant?<\/strong> \u00a0You can download this and hundreds of other consulting frameworks<\/a>\u00a0and consulting training guides<\/a> from the FlevyPro library.<\/div>\n
Starting from the view of looking at how performance is changing over time, Strategy Dynamics works logically through 3 stages:<\/p>\n
- \n
- Stage 1: Resources<\/strong>
\nIdentify the resources that performance depends on. \u00a0Customers, cash, people, product catalog, and capacity are the most common examples of resources.<\/li>\n<\/ul>\n- \n
- Stage 2: Flows<\/strong>
\nIdentify the flows that cause these resources to “fill and drain.” \u00a0The thinking behind this step explains why today’s performance and future performance are both unavoidably dependent on history.<\/li>\n<\/ul>\n- \n
- Stage 3: Factors<\/strong>
\nIdentify the factors that cause resources to be won and lost. \u00a0 The final question of causality we need to answer is what has been driving the “flow-rates” for each resource.\u00a0 For example, how quickly customers have been won, or how quickly staff were lost, etc.\u00a0 These flow-rates turn out to depend upon:<\/p>\n- \n
- Management Decisions<\/li>\n
- External Factors<\/li>\n
- Existing Resource-levels<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n
When the 3 steps are combined, the principles create an integrated diagram that depicts \u00a0the “physics” of the system, known as the Strategic Architecture.<\/p>\n
Are you a management consultant?<\/strong>\u00a0\u00a0You can download this and hundreds of other\u00a0consulting frameworks<\/a>\u00a0and\u00a0consulting training guides<\/a>\u00a0from the FlevyPro library.<\/div>\nInterested in gaining more understanding on how to apply Strategy Dynamics? \u00a0You can learn more and download an editable PowerPoint about Strategy Dynamics\u00a0here on the Flevy<\/a>\u00a0documents marketplace.<\/p>\n","protected":false},"excerpt":{"rendered":"
Have you heard of Strategy Dynamics? \u00a0Most people haven’t. Strategy Dynamics\u00a0is a framework to explain our current performance–and to develop and execute strategies for improving our future performance of our organization. \u00a0This approach emphasizes building and sustaining the resources and capabilities necessary to succeed. Strategy Dynamics focuses on performance over time. The overarching objective of… The Future Is Now: Improve the Future via Strategy Dynamics<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":2794,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","footnotes":""},"categories":[81],"tags":[1179],"class_list":["post-2793","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-strategy","tag-strategy-dynamics"],"_links":{"self":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/2793","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/comments?post=2793"}],"version-history":[{"count":3,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/2793\/revisions"}],"predecessor-version":[{"id":3652,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/2793\/revisions\/3652"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/media\/2794"}],"wp:attachment":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/media?parent=2793"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/categories?post=2793"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/tags?post=2793"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
- Stage 3: Factors<\/strong>
- Stage 2: Flows<\/strong>
- Stage 1: Resources<\/strong>
- The method provides a solid foundation for methods such as the Balanced Scorecard and Value Based Management, and is a means of integrating other established strategy frameworks and approaches, such as PEST(EL)<\/a>, Core Competence<\/a>, and Value Chain Analysis<\/a>.<\/li>\n<\/ul>\n
- Since it highlights exactly where management actions and decisions exert control, it provides clear and specific strategies and action plans, that can be adapted as the future unfolds.<\/li>\n<\/ul>\n
- Being evidence-based, it can solve differences of opinion amongst team-members. It also allows each individual, both amongst the management team and in the wider organization beyond, to see where their activity contributes to the whole, and on whom they depend.<\/li>\n<\/ul>\n
- The method is strongly evidence-based and rigorous, offering a solid understanding of what causes current performance and confidence in the future performance.<\/li>\n<\/ul>\n
- It is also applicable to not yet existing enterprises, such as new ventures or voluntary initiatives.<\/li>\n<\/ul>\n
- The method works for every kind of enterprise\u2014commercial, public-service, or voluntary\u2014as well as to every function within an enterprise.<\/li>\n<\/ul>\n
- HOW<\/em> can we design a robust strategy to radically improve that performance into the future?<\/strong><\/li>\n<\/ol>\n
- WHERE<\/em>\u00a0will performance go if we continue as we are doing today?<\/strong><\/li>\n<\/ol>\n