Transcript: The kryptonite of strategic thinking

KARL MOORE – This is Karl Moore of the Desautels Faculty of Management at McGill University, talking management for The Globe and Mail. Today, I am delighted to speak to Yves Doz, from Insead [international business school in France].

So, Yves, you have been involved very much in strategic thinking for many years and helping to develop it. You looked more recently at government, and applying those ideas to government. What are some of your early conclusions?

YVES DOZ – That is one of the things I am working on right now, in some depth. We are looking at the way in which national governments can become more integrated, can become more strategic, can take a longer-term perspective, [rather] than just be hostage to the political agendas and the political time frames, and that is obviously quite challenging.

We have been finding two or three interesting things.

One is, in a world which is increasingly interdependent and therefore complex in the complexity sense, complexity theory sense, and at the same time is changing rapidly with globalization, global warming, and a number of international issues of some great magnitude, governments find themselves increasingly wanting in terms of their capability to actually manage their national adjustment policies in the face of these major changes and complex changes.

So I think one of the critical issues here is to think about what is the limit of strategic thinking and how far can you extend it in the face of complexity. Some governments are pushing very much the idea of, if we have better insight, if we had better scenario-planning adapted to public policy, if we had more control over what happens, therefore perhaps we are more autocratic, and so on, then would be able to essentially extend the domain of strategy in the face of complexity.

Now I think that is a little of a self-defeating proposition because, almost by definition, complexity means that you are dealing with a complex system in front of you and this system keeps changing, keeps reacting in unpredictable ways, and therefore to want to be strategic in the face of complexity does not work.

So one of the challenges I am currently kind of thinking about is what can we do with complexity models which would be useful for management, or useful for public policy, knowing that very often these complexity models basically say that, "Well, there is very little you can do." So it almost challenges fundamentally the tenets of strategic management or executive leadership.

KARL MOORE – Given what you are thinking about, what is the implication for managing a government or a complex multinational more effectively with all this complexity out there?

YVES DOZ – The issues are, one, can you improve your understanding? Again, as I was saying a few minutes ago, there are limits to this but that does not mean that you should not do it and should not be aware that beyond a certain point, the complexity is going to defeat attempts at being rational.

So I think being better informed, I think more insight, I think better information on a variety of different conditions, of a variety of different situations, including ones which are not very obvious and therefore having a greater cultural and sociological understanding. That applies to both governments dealing, for instance, with minorities or with immigrant populations they don't really understand very well, and also to countries dealing with the complexity with an interactive, integrated world economy. So I think being better at having more insight, more understanding, and so on is step one.

I think step two is also acknowledging the limits of your actions and therefore taking a more experimentalist approach to things, saying "We are going to try, see what happens, understand the feedback and then learn and then try to do more of what seems to work. Then we will see if that actually works more generally or whether we were on another false strike."

So I think that this notion of being humble, rather than hubristic, and again being more sensitive to the various stakeholders. So taking more of a truly political and sociological approach to things and understanding the way social systems work, it seems to me that those three things are the key starting points.