Calling for strategic misfits and imbalanced scorecards

The brilliant Roger Martin makes an interesting point in the conclusion of his recent Practitioner Insight piece, here on Medium:

“Recognize that some strategies require the building of a new management system… That is not a bad thing — it is a positive sign of the distinctiveness of your strategy”. (1)

In other words, a good strategy involves a mismatch between the current business and what it aims to become.

That seems surprising given that Martin’s ‘strategy cascade framework’ is based on logical fit between ambition, market, business model, capabilities & systems.

He seems to be saying that strategic misfit is OK.

He’s not the first to say that. Misfit, or misalignment, is central to the concept of strategic intent, as articulated by Gary Hamel and CK Prahalad:

“Strategic intent creates an extreme misfit between resources and ambitions. Top management then challenges the organization to close the gap by systematically building new advantages.” (2)

Famously, Gary challenged Nokia in 1992 to manufacture 1,000,000,000 mobile phones (there were only 35m in the world at the time). It seemed *almost* crazy, but Nokia achieved it by 2005, and became Europe’s most valuable company in the process. (3)

Strategy frameworks that require strong alignment between goals and resources — such as the Balanced Scorecard — tend to curtail ambition and intent in the interest of preserving fit.

As my colleague Gordon Hewitt MBE says, rather than balanced scorecards, those companies seeking to outperform must have imbalanced scorecards to drive game-changing strategies.

Just a thought.

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(1) “The Motivation for Strategy”, https://medium.com/p/d0396049487f, Feb 2023
(2) “Strategic Intent”, HBR, May-June 1989
(3) “Open Strategy”, Stadler/Hautz, foreword.