The Importance of Power in 'Strategy-Smithing'
Strategy formulation is not just about analysis and decision-making; it’s also about influencing the right people in the right ways to ensure that the strategy is effectively implemented.
In this article, I distill Kotter's Power and Influence, a practical read that follows Harvard's typical case-study approach at presenting practical lessons for the strategist (and, really, any other practitioner interested in strategy).
In this edition:
What I Think You Need To Know: How do diversity and interdependence relate to power and influence, and what are the implications to organizations and strategists?
This Should Make You Smarter: Key questions to ask in any organizational endeavor
Through The Systems Thinker’s Lens: How can systems thinking help you tackle organizational complexity while leveraging power and influence?
The book’s key message is that power and influence are not just about hierarchical position (in fact, I’d argue, they rarely are), but also about the ability to understand and navigate the complex, interdependent networks within an organization.
For strategists, this message is particularly relevant. Strategy formulation, for instance, is not just about analysis and decision-making; it’s also about influencing the right people in the right ways to ensure that the strategy is effectively implemented and promptly adapted to change or other surprising factors along the way to aspirations. This requires a deep understanding of the organization’s power dynamics and the ability to build relationships and coalitions that can support the strategy.
Moreover, politics is useful is getting strategies accepted, argues Mintzberg (pp. 244—247), such as recognizing and analyzing political realities in your organization, working on middle management to get them to commit to your strategy, forming coalitions, or resorting to classical political tools to maneuver skillfully.
What I Think You Need To Know
There are two major characteristics of any organizational ecosystem at the underpinnings of power and influence: diversity and interdependence.
Diversity is the difference among people with respect to goals, values, stakes, assumptions, or perceptions in the organization.
Interdependence is when two or more parties have power over each other because they are dependent on each other.
Here come Kotter's key observations that guide the rest of the book:
The more diversity there is, the richer the set of opinions, agendas, aspirations, desires, motivations, etc. This adds to the organizational complexity and can be leveraged for tremendous good, but requires careful maneuvering more than improvisation and, as I shall describe below, continuous strategic thinking.
The higher the interdependence among parties, the less inter-party power there is. This is to be expected, given that one cannot do without the other, thus being reinforced positively in a causal chain of needs.
Conversely, unilateral dependence leads to dominance. If you depend on your team member but not vice versa, then they have power over you.
When you depend on someone over whom you have little or no control, then you are in the tricky situation of a power gap.
Because we work in complex organizational ecosystem, which no longer issue orders to be followed, power gaps are ubiquitous.
Factors that produce power gaps include:
specialized, localized knowledge
Single points of failure
Shared reporting lines (e.g., in matrix organizations)
Centrality of your job to your manager's agenda
Centrality in the organizational network of personal relationships (e.g., a central person who chats a lot with others)
It isn't hard to deduce that the higher the diversity and the interdependence among people, the higher the incidence of conflict. This pushes members to craft ways to influence others and events in the complex ecosystem. Because resolving such conflicts is time-consuming and prohibitive in practice, people compensate by trying to win egotistically.
This is where the strategist needs to realize that power and influence are crucial pillars to maintain and promote a healthy organizational ecosystem. "To manage this complex diversity and interdependence" that is almost always the case in any organization, "power is needed." Its sources are unequivocally guided by intelligence across the following landscape:
Information and knowledge: You need gather intelligence on related parties. Because you cannot solve everything at once, you focus your efforts in some business context. The parties in that context are what you need to work on. Analyze people.
A technique I often use and recommend is profiling (e.g., using behavior analysis, analyzing speech patterns, motivators, etc.)
Relationships: People foster relationships based on respect, needs, obligations, friendship, trust, which collectively establish the needs for cooperation and compliance to succeed. Thus, they are a strong source of power, since they provide you with continuous intelligence on whose cooperation and compliance you need on your way to your aspirations.
When analyzing interdependencies among people, pay special attention to lateral relationships, i.e., the people outside your business context who neither report to you nor you to them.
A technique I use here is organizational network analysis (ONA), which examines the multitude of links between people (links being any relationships of interest, such as trust, advice, dislikes, etc.). While this may sound time-consuming, it will take a few first interactions for you to construct a good sociogram as your baseline. Do that whenever you chat with people.
Reputation: If you have a proven record and a good reputation, you possess a strong power pillar. It so happens that reputation positively reinforces the power from relationships, since you will create more links with others based on their agendas.
The credible track record is no more useful than the overall reputation you have fostered in your circles. Both are useful to maintain, but reputation, I'd argue, is critical to guard.
Skillful Maneuvering: Knowing how to use information to influence others is itself a source of power. This is a skill you can build by training situationally.
The key here is to leverage these power sources to create "visionary agendas to minimize destructive power struggles, resolve conflict, and create a resource network that you need to implement your agenda." This, argues Kotter, is a core leadership competency to handle power gaps and influence positively.
To fill power gaps, it is important to have identified relevant lateral relationships, so that you know whom you need to lead and influence:
Leverage the four power sources above to build strong relationships, both lateral and upward.
Spot who's resistant and "noisy" (in the sense of always wanting things without legitimacy or power).
These are challenging people that can become thorns if left unmanaged. Developing good relationships with resistant individuals is the first prescription that's attempted.
I often find that this works well, in time, if done with character and integrity, but should it fail, suggests Kotter, "implement forceful, manipulative ways with the caveat of the inherent high risk -- this requires a seasoned, courageous leadership stance". Overall, the most effective strategy is to eliminate, if not prevent, problems arising from lateral relationships.
Use meetings for indirect influence by appealing to your audience's rationality as a factor that can influence them when they are confronted with a good argument presented in an effective story.
Develop an adequate power base, particularly by taking into account the pivotal challenges of your organization. This is your opportunity, as a strategist and leader, to develop guiding policies in light of capabilities and resources to meet those challenges.
"Take advantage of simple opportunities that arise each day," advises Kotter.
Strategically invest some of the power you garner into long-term projects.
This Should Make You Smarter
To develop and maintain power and influence, pay systematic attention to the following questions:
What activities are required to implement a decision toward meeting an objective?
Whose cooperation do I need to do accomplish objectives and achieve set key results?
Whose compliance is needed, who would otherwise become a roadblock in my activities?
What differences exist between me and other team or organization members that might generate conflict? Why?
What are my team or organization members' resistance points and levels? What is their power base and sources?
What are my power sources and who else could help me build and consolidate relationships?
In essence, Kotter’s book and the many lessons that can be drawn in practice underscore the importance of power and influence in strategy formulation, reminding strategists that successful strategies are as much about people and relationships as they are about plans and decisions.
Through The Systems Thinker’s Lens
When it comes to power and influence, big-picture thinking is a high-level advice you'll often hear in dismay, given the efforts required to reflect on it. One way that systems thinking -- the undergirding skill -- can help here, is to tackle complexity by looking or reacting not at events, but examining the deeper systemic structures that give rise to patterns of behavior:
Understand the interconnectedness: Systems thinking can help you grasp the interconnectedness in your organization (or business unit) to navigate the power structures within, as it allows for a more comprehensive view of how different elements within the organization interact with each other.
Identify patterns: Identification of patterns and trends in individual behaviors, but also in group dynamics (e.g., leveraging organizational network analysis). This can be particularly useful when trying to understand power dynamics and influence within the organization.
Enable effective action: When exercise power and influence in your organization, you need to outline coherent actions that align with your strategy toward your aspirations. To do this, systems thinking can help you explore complex business contexts. You can identify high-leverage intervention points, such as rules and information flows so carefully ensconced in the organization’s social networks and routines.
Promote innovation: During uncertain times, systems thinking can spur innovation and growth, especially with a properly-architected team. This could be beneficial when you plan to drive change or make an impactful decision.
Happy Strategizing!