This is obviously true. So obvious that it seems almost self-evident. Yet, the empirical evidence is also clear -- most large organizations do not have clear strategies as Richard Rumelt defines the term.
How Nelson Did It
One of the most interesting commentators on strategy is Richard Rumelt, author of Good Strategy/Bad Strategy (2011). The book opens with a brief account of Admiral Horatio Nelson’s naval victory at the Battle of Trafalgar in 1805, when the British fleet consisting of 27 ships defeated the combined forces of the French and Spanish, which numbered 33 ships. Nelson won the day by adopting an unconventional strategy. Flouting the naval convention of the time, he divided his smaller fleet into two columns and sailed them perpendicularly into the enemy fleet to cut the Franco-Spanish line.
Nelson knew that his lead ships would be vulnerable to Franco-Spanish guns until they could close on the opposing fleet. He gambled that the less well-trained enemy gunners would not be able to capitalize on their advantage. He was proved right. The French and Spanish canons were not able to compensate for the heavy swell and missed their opportunity to sink the British ships while they could not return fire. Once the battle was joined, the superiority of the British seamanship was decisive. The French and Spanish lost 22 ships. The British lost none. This, as Rumelt points out, is an example of a good strategy.
“Nelson’s challenge was that he was outnumbered. His strategy was to risk his lead ships in order to break the coherence of his enemy’s fleet. With coherence lost, he judged, the more experienced English captains would come out on top in the ensuing melee. Good strategy almost always looks this simple and obvious and does not take a thick deck of PowerPoint slides to explain. It does not pop out of some “strategic management” tool, matrix, chart, triangle, or fill-in-the-blanks scheme. Instead, a talented leader identifies the one or two critical issues in the situation—the pivot points that can multiply the effectiveness of effort—and then focuses and concentrates action and resources on them."
Rumelt offers several reasons why this is so:
Large bureaucracies do not have strategies, they produce shopping lists.
Bad strategy flourishes because it floats above analysis, logic, and choice, held aloft by the hope that one can avoid dealing with these tricky fundamentals and the difficulties of mastering them.