# Good strategy is the effective management of evolutionary potential > [!quote] Seneca > The whole future lies in uncertainty: live immediately. ## Agility as the antidote to uncertainty As a business leader today, you're having to navigate a particularly disruptive and uncertain period in economic history--a new era of low growth, de-globalisation, and unsustainable levels of debt[^1]. Since 2020, the world has experienced global supply-chain disruption caused by the COVID-19 pandemic, rapidly rising food and energy prices caused by the war in Ukraine, and now escalating conflict in the Middle East. These events highlight the complex, interconnected nature of our global economy. The reality you face is that, in complex environments there is no linear material causality (no perceivable cause and effect), only uncertainty. To address this increasing uncertainty, you must develop agility and resilience in your organisation. Business agility and resilience requires your organisation to see and understand more about its reality and to improve the accuracy and speed of its decision-action cycles. Good strategy is critical to your success. ## Good strategy Good strategy is coherent action derived from a set of guiding heuristics developed to overcome specific challenges identified by diagnosis of the current context[^2]. These three elements 1/ diagnosis, 2/ guiding heuristics, and 3/ coherent action, form the core of a good strategy. - **Diagnosis:** explains the nature of the problem the strategy will address. It simplifies, to an appropriate level, the complexity of reality and focuses attention on the constraints governing or enabling the current context. - **Guiding Heuristics:** are principles for acting on the [[Constraints]] highlighted in the diagnosis. They enable action to be guided in a direction without being prescriptive about exactly what to do. - **Coherent Action:** orchestrates and reinforces the asymmetric allocation of organisational resources (energy) to do more of certain behaviours and less of others (more good, less bad). Good strategy brings people together to start a journey of mutual discovery and adaptation. A fundamental error often made in strategy is to try and design an idealised future state. Instead, good strategy manages the [[Home|evolutionary potential]] of now. ## Constraints as causes Organisations are [[Complex Adaptive Systems]]. While there's no perceivable cause and effect in complex systems (if I do this, then that will happen), [[@Alicia Juarrero]] gives us hope as her work shows how, in complex systems, [[Constraints]] act as causes[^5]. Constraints are relational properties that govern or enable the probability of possible futures. [[Constructors]] are a special type of constraint that produce consistent, replicable, and reliable outcomes (e.g., a process or mechanism). The practice of mapping constraints and constructors highlights what can and should be changed, what for practical purposes is unchangeable, as well as any volatility that needs to be stabilised and contained. A new tool from [[@Dave Snowden]], known as [[The Estuarine Framework|Estuarine Mapping]] is a practical way to diagnose the constraints responsible for the emergent future of your organisation, and identify interventions to begin to manage them. ## Estuarine mapping by Dave Snowden [[The Estuarine Framework]] , from [The Cynefin Co](https://thecynefin.co/) and [[@Dave Snowden]], is the third major framework in the Cynefin ecosystem (the previous two frameworks are [[The Cynefin Framework]] itself, and [[Flexuous Curves]]). The framework was developed as an antidote to traditional approaches to strategy, because they fail in the face of the complexity of human systems. [[The Estuarine Framework|Estuarine Mapping]] reflects the key principles of change in complex environments[^3] : 1. Understanding where we are, and starting journeys with a sense of direction rather than abstract goals. 2. Understanding, and working with propensities and dispositions, managing both so that the things you desire have a lower energy cost than the things you don’t. 3. Initiating and monitoring micro-nudges, lots of small projects rather than one big project so that success and failure are both (non-ironically) opportunities. ### Mapping constraints In a workshop setting with your peers and/or teams, brainstorm the constraints applicable to your organisation's specific context. [[Constraints]] can be attractors, connections, exchanges, boundaries, and identities. Examples of some common organisational constraints are fiscal year end, budgeting procedures, decision authority, organisation structure, commercial contracts, policy frameworks, other strategies (e.g., application strategy, data strategy, data centre strategy, HR strategy etc.), team charters, project mandates, regulation, local laws, cultural norms, capacity, service levels, and the speed of light etc. There will be many, and using a [[A Typology of Constraints]] will help to generate ideas. Then, map the list of constraints relative to one another on a grid with two axis; energy to change on the y axis, and time on the x axis. Energy in the framework represents organisational effort, resources, and people. [[Constraints]] should be clustered, de-duplicated, and renamed in the process. Where there is disagreement on placement, don't compromise. Instead, break them down further until you agree where they should go. The objective is to get as accurate agreement on the current situation as possible. ![[Map constraints constructors and counterfactuals.png]] ### The zone of strategic operations Once the group has mapped the constraints, it's time to debate and apply three [[Boundaries]]. 1. The first is the counterfactual boundary. It's drawn in the top-right of the grid, and everything above the line is considered, for all intents and purposes, unchangeable. 2. The second is the liminal boundary. This boundary is drawn just below the counterfactual boundary to contain things that might be unchangeable, but might be movable for someone outside the process with sufficient agency. 3. The third is the vulnerability boundary. This is drawn to isolate the constraints that require the least amount of energy and time to change. They're not "low hanging fruit", they're a sign of volatility in your organisation and should be assessed for impact. In the middle of the grid, between the vulnerability boundary and the liminal boundary, lies the **zone of strategic operations**. It contains all the critical [[Constraints]] and [[Constructors]] that you're able to influence to change the energy gradient of your organisation. ### Changing the energy gradient of your organisation In complex human systems, behaviours follow the path of least energy, so the aim is to make what you want to happen easier, and what you don't want to happen harder. By doing this, you shift in your favour the probability of the future you desire emerging (see [[The Adjacent Possible]] by [[@Stuart Kauffman]]). After you've agreed the three boundaries, your next job is to brainstorm a portfolio of interventions (micro-projects) across three sets[^3] 1/ "Compass Rose" projects designed to increase (North) or decrease (South) the energy cost, or increase (East) or decrease (West) the time cost around [[Constraints]] in the zone of strategic operations, 2/ "Monitors" and "forward Scouts" to indicate whether the counterfactual/liminal boundaries, or the counterfactuals themselves, are shifting, and 3/ "Stabilise" projects to confirm vulnerabilities are where they need to be, and to contain them. You can expect to generate anywhere between 50-100 micro-projects[^4], and using a [[A Typology of Action]] can help the group to generate ideas. Keeping individual projects small is key. You're looking to implement 'safe-to-fail' projects so that even if they fail, the valuable feedback and learning they generate exceeds the investment made in them. This way both success and failure become opportunity. ## Lead your organisation to competitive advantage Our world is inherently complex and uncertain, and there's no way out! It requires a transition in leadership practices. If you can accept that for matters of strategy traditional approaches fail, it creates the space to explore current theory-informed practice for building sustainable business growth. By adopting the next generation of practices, you can lead your organisation to competitive advantage. [^1]: [Global Risks Report 2023 | World Economic Forum](https://www.weforum.org/reports/global-risks-report-2023/) [^2]: Good Strategy/Bad Strategy: The Difference and Why it Matters by Richard Rumelt [^3]: [[Estuarine Framework by Cynefin.io]] [^4]: Dave Snowden at the Risk & Complexity SIG on [[2023-12-15]] [^5]: [[Dynamics in Action by Alicia Juarrero]]