Subject: Strategic Management
Publish: 2009
Status: full text
Source: California Management Review; Spring2009, Vol. 51 Issue 3, p74-94
Preparation: Scientific Database Management Journal Articles www.SYSTEM.parsiblog.com
Abstract: This article reports on functional executives and the importance of strategy in management. The role of strategists in business operations is changing due to shifting social and environmental processes. The article discusses organizational change in the U.S. and Great Britain and how these Senior Strategy Directors (SSDs) are involved in the connectedness of strategy, as well as their business contributions, capabilities, and activities. Information is also provided on management teams, job titles, diplomacy, and job stress. --Download Article

Introduction: Today, strategy appears to be everyone’s domain. Senior functional executives often have titles such as senior vice president of strategic marketing, head of strategic IT, global strategic operations director, and senior vice president of global strategic HR. Even within functions and business units, many executives now have strategy titles. This proliferation of “strategists” may reflect the increasing pressures upon businesses to respond more rapidly to environmental change not only through incremental revisions of products and services, but also through re-aligning strategy, structure, and process.1 This requires all aspects of business to become more strategic in outlook. Learning and unlearning more rapidly is the new mantra, and paradoxes are being driven down into organizations more than ever so that each part of the business needs to be strategically agile and yet stay nimble and flexible— making strong choices and resource commitments for the long term whilst remaining able to constantly adjust courses of action and development trajectories. 2 In reacting rapidly, flexing and managing paradoxes, significant strains are being placed upon the interconnectedness of organizations. In order to manage these tensions effectively, there is a need for greater strategic engagement and awareness than before and this may explain the emergence of a new breed of C-level executives primarily focused upon strategy. However, there are very few studies on the role of U.S. senior strategy executives.3 So far, it is not clear how they are involved in “connecting up” strategy and whether their activities are similar in other countries.
This article focuses upon the role of UK senior strategy executives and how they are involved in the connectedness of strategy. Specifically it examines the role, activities and capabilities of existing senior executives tasked with strategy and whether they help organizations become more agile. These “Senior
Strategy Directors” (SSDs)—defined as senior board level (non-CEO) executives, whose very job is about the strategy of the business—ought to be closely involved with the connectedness of strategy in all its aspects, and yet we know very little about what they do. The proliferation of strategy titles throughout large firms makes an enquiry into the role and work of the SSD particularly pertinent if everyone else is now a strategist.
This article therefore addresses the following question: What is the role of the SSD? In particular: What do SSDs do? What specific capabilities do they deploy to enable effective contribution to the firm? In what ways do SSDs facilitate the connectedness of strategy? Compared to previous U.S. studies focusing on senior strategy executives, our research is distinctive in three ways. First, we examine SSDs in a different context (the UK): second, we adopt a novel practice  pproach to uncover their actual activities and capabilities; and third, we focus on the “interconnected nature” of their role. By focusing on UK SSDs, we are able to draw comparisons with existing studies of U.S. counterparts in order to determine similarities and differences across national borders.

The Senior Strategy Executive in the U.S.
Traditionally, the way strategy is made and executed is primarily associated
with the actions of managers functioning at upper hierarchical levels.
Attention has focused predominantly upon the CEO, with many empirical studies
demonstrating they can have substantial affect upon firm performance. This
“upper echelons” perspective4 has put at center stage CEOs, their top management
teams, and the boards of directors, as the most important “strategists” in
organizations. However it is only very recently that attention has focused upon
a new type of C-level executive, the senior strategy executive. In 2007, the Harvard
Business Review reported a study based on
media data and interviews from 100 appointments
of senior strategists.5 These executives,
described as Chief Strategy Officers (CSOs),
have a multiplicity of titles and diverse backgrounds
but share many commonalities of role.
They are involved in strategy formulation, strategy
refinement, and strategy implementation.
In Mintzbergian terms, they straddle the classic
divide in strategy, between formulation and
implementation. This breadth of activity means
CSOs need to be able to tackle a wide range of
challenges such as consumer innovation, international
expansion, M&A, communications, and process redesign —a range that
most people in functional-oriented careers have not experienced. They work
with and influence a wide range of executives, and this requires a broad mix of
skills and experience. CSOs have significant authority to make things happen and are often given carte blanche to tackle company-wide challenges and seize
new business opportunities. Generally they achieve their aims through the use
of direct authority and, in a few instances, influence through reflected authority—
the implicit or explicit support of the CEO. The CSO therefore is a powerful
figure, acting behind the scenes to directly influence and organize managers in
order to achieve strategic alignment. In this image, the CSO is a star player, with
a strong track record of achievement and a CEO in waiting.
Recently, the McKinsey Quarterly reported findings from a round table
of senior strategy officers.6 Variously titled senior vice presidents of strategy
and investor relations; of strategy and business development; and of strategy
and execution, the round table identifies that these CSOs also feel there are
certain commonalities in the role. Firstly, they all comment upon the centrality
and importance of the CEO as chief strategist and recognize that the CSO’s
role is dependent upon the CEO for sign-off decisions. The critical role of the
CEO means that the CSO needs to be able compliment his or her specific skills
and tendencies and add value by being able to explore the variety of strategic
choices. Secondly, CSOs have one foot in the corporate suite and the other deep
in business units. Although there were differences in emphasis, with some strategies
more head-office-driven and others business-driven, there was agreement
that CSOs get feedback from businesses, overlay global trends, and then prioritize
opportunities. Thirdly, balancing short- and long-term goals was perceived
as an important challenge, and some felt it was the most important one.
The CSO is a powerful and somewhat remote figure—shaping, dictating,
and evaluating strategy in an organization. So far, studies on the role of the CSO
have focused upon the U.S.7 and have tended to downplay the CSO’s capabilities.
They have not examined the role of such executives in other macro-social
and national contexts where there is potential for new insights.8 Our study
examines senior strategy executives in the UK to reveal the capabilities and
skills they deploy.

The Strategy-as-Practice perspective9 provides a useful lens for examining

SSDs, as it redirects strategy analysis from an organizational focus upon strategy

(as something an organization “has”) towards an individual level of analysis (of

strategy as something executives “do”). It dives into their day-to-day activities

to uncover what they spend their time doing, rather than inferring their actions

and roles from the overall strategic efforts of the organization. In the Strategyas-

Practice view, strategy is accomplished socially through the actions and interactions

of multiple levels of executives.

The data for this article is derived from two sets of in-depth interviews

with SSDs in the largest companies in the UK, collected five years apart, as well

as longitudinal data collected from two large multi-business firms. Overall, our

data consists of 97 in-depth interviews with SSDs, their strategy teams, and significant

stakeholders directly involved in strategy processes. (Further detail on the research is contained in the appendix.) To present our data, we use three

concepts central to the Strategy as Practice approach:10

???? Practitioners—These are the workers of strategy and include SSDs, their

strategy teams and other specialized strategists in the organization. Practitioners

also include other significant strategy stakeholders who influence

the process. These may include other senior managers and external

consultants, investment bankers, lawyers, and accountants. For this study,

our focal practitioners are SSDs and strategic stakeholders operating in

and around large firms.

???? Praxis—This is the actual work of strategy, what strategists do. This

includes presenting, meetings, consulting, writing, communicating, and

so forth. All these deliberate activities may be drawn upon in order to

make and execute strategy.

???? Practices—These refer to shared routines of behavior, including traditions,

norms and procedures for thinking, acting, and using “things.”

Practitioners: The SSD

The first thing that struck us when investigating SSDs is the variety of

titles they hold. For instance, we encountered: Global Director of Strategy, Head

of Strategy, Executive Vice President for Business Strategy, Global Business

Development Director, Executive Director of Strategy and M&A, Strategic Planning

Director, and Corporate Development SVP. Among these “different” executives

are nuances in activities with some oriented towards process management,

others towards planning, and some more focused upon M&A. However, they all

operate across a very broad portfolio of activities.11 Despite the variety of titles,

the SSDs noted that these are not very important, as in practice the activities

overlap significantly. Indeed, most SSDs commented that their titles were arrived

at through a rather ad-hoc process with little intention that the title should necessarily

resonate deeply with the content of the job. The variety of titles reflects

the difficulty in prescribing clearly the actual scope and activities of SSDs.

Another peculiarity of SSDs is their “location” in the hierarchy of the firm

and their position relative to other senior executives. Figure 1 illustrates their

main locations. Such organizational charts show that the primary direct report

is with the CEO—sometimes as the only report and sometimes with another

report. We identify three different types of SSD in terms of their position on

organizational charts:

???? The SSD sitting on the main board in their own right. This is often a

long serving executive of the organization with substantial previous line

experience.

???? The SSD reporting to a main Board Director and also working closely

with the CEO. This is frequently a high-powered management consultant

brought into the business for their industry knowledge and superior analytical

skills. This outside person may have also have been brought into

the head office strategy team at a more junior level and been promoted

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