What are the Simple Rules that guide our Strategies?

Thanks Paul Knox-Clarke for sending me ‘Strategy as Simple Rules’, a 2001 Harvard Business Review article that helps clarify some fairly fuzzy stuff I’ve been writing here and elsewhere on ‘strategic rules of thumb’.

The basic idea is that when strategizing, large organizations spend too much time discussing the ‘what’ (climate change? Gender? Education? Livelihoods?), and too little on the ‘how’. And within the ‘how’, the most important bit is probably the default questions and instincts that govern an organization’s daily decision-making, rather than the long-winded strategy documents that no-one reads.

‘Strategy as Simple Rules’, by Kathleen M. Eisenhardt and Donald Sull, looks at the private sector, and argues that ‘In a period of predictability and focused opportunities, a company should have more rules in order to increase efficiency. When the landscape becomes less predictable and the opportunities more diffuse, it makes sense to have fewer rules in order to increase flexibility.’ Or more pithily ‘when business becomes complicated, strategy should be simple.’

Well we are definitely in the latter world for the foreseeable future, and the authors come up with rather a neat typology of the different kinds of simple rules that organizations can pick:

So let’s think what that might look like for INGOs like Oxfam. I’m going to do it for advocacy, but you could equally well run the exercise for long-term development or humanitarian (and it would be great to find rules that applied across all 3):

How-to rules: Everyone must be passionately committed to social justice, and supporting the agency of poor/excluded people and communities

Boundary rules: Any investment in advocacy requires a realistic chance of winning something, be it a policy change, a shift in attitudes, or getting an issue onto the public agenda

Priority rules: How many people will benefit? How many of them will belong to poor/excluded people and communities? Will the changes be sustainable?

Timing rules: What critical juncture or political/organizational window of opportunity will the advocacy take advantage of?

Exit rules: Who will decide on exit? On what evidence? How will partners and communities be involved in the decision?

I can see that I moved rapidly from assertions to the questions we should be asking, but I think that’s OK. However, these are off the top of my head, and could definitely be improved – suggestions please?

Two caveats: in practice, periods of unpredictability actually work in the opposite direction in the aid sector, as layers upon layers of compliance and reporting are imposed by donors or organizations’ own risk managers, desperate to avoid mistakes. Secondly, the great private sector success legends lauded in this 2001 paper as putting this kind of thing into practice included Yahoo and Enron…..

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One Response to “What are the Simple Rules that guide our Strategies?”
  1. P S BAKER

    Yes, definitely fewer rules when things are uncertain, which we are all living in now.
    In the area I work in (climate change/breakdown) where in any given situation we are uncertain about what will happen next or what practical steps to take, I find a simple matrix appropriate, such as here:


    and here: https://www.jvds.nl/reports/NWS-E-20093.pdf

    The essential thing is to establish roughly where you are for any particular problem.

    This is relatable to Snowden’s Cynefin framework https://www.youtube.com/watch?v=N7oz366X0-8

    And really it’s all Post Normal Science (‘where ‘facts are uncertain, values in dispute, stakes high and decisions urgent’)’– if you haven’t interviewed Jerry Ravetz, perhaps you should because I think it’s relevant to making change happen.