Illustration of copy and pasting a strategic plan

What is a strategy?

Strategy, what a buzzword. Let’s just pause for a second and ask ourselves: what is a strategy? What does a strategy look like in the context of our work? It is one of the most frequently used terms in the private sector. It is a sign of leadership. If you are a leader, you are supposed to know strategy, period. But what does it mean in the public sector? Is there any difference between the public and the private sector?

Thanks to PM magazine, I have published over a dozen articles on strategy. But not until recently was I asked those very questions. Here is my response for your consideration: strategy is a choice about the broad approach an organization is going to take toward executing its mission and, in doing so, achieving its vision. The two types of strategies in the public sector are comprehensive and single-issue based. A comprehensive strategy, such as a strategic plan, covers a broad range of issues and is driven by aspiration. A strategy that is single-issue based, such as the resilience strategy or the community wellness plan, focuses on one topic. Single-issue based strategies are meant to address an issue or solve a problem. For simplicity, you can think of a strategic plan as an organizational strategy or an overarching strategy, and a single-issue based strategy as a functional strategy.

The Current Issue

By definition, the life cycle of a strategy can be broadly categorized in two phases: formulation (the creation and approval of the approach, also known as strategic planning) and execution (the implementation of the approach).1 Strategy was not prevalent in the public sector until the early 1980s when strategic planning was introduced from the best-run private sector companies. The idea is to improve from traditional, long-range planning that very much takes a functional view of issues versus an organizational view taken by strategic planning.

Another premise of strategic planning is that organizational success is contingent on the fit with its environment (also known as Harvard Policy Model), which is not considered in the traditional planning approach. The main purpose of strategy in the public sector is to help public sector organizations “create public value,” to use Mark Moore’s language2 or “build a better, sustainable community,” to use my own. Now, it is almost everywhere. You rarely see a public organization that doesn’t have a strategic plan or any sort of strategy.

But maybe not as promising as anticipated, according to the Association for Strategic Planning, more than half of the strategies are not reaching their potential due to poor execution. So, what happened? What the data has informed us is that even though everyone—from the strategists,3 managers, elected officials, community stakeholders even to the public—has worked hard to formulate a strategy, there is still a high risk that the work is not being implemented properly as planned, or in many cases, not being implemented at all, ending up sitting on a shelf collecting dust.

When strategy is not executed properly, it leads to a series of missed opportunities and challenges:

1. First and foremost, the associated community outcomes would be compromised or not realized at all.

2. Second, when work is not getting done or not getting done properly, elected officials may feel they have to step in to make a difference. As a result, it builds an unproductive routine with elected officials as they want to feel more assured or they see this is the only way to get things done.

3. Last, within the organization, it sets a bad tone for culture as staff would perceive a lack of commitment and accountability.

Research conducted by the National Center for Public Performance at the School of Public Affairs and Administration at Rutgers University—Newark for a network of U.S. professionals in public organizations in 2014 has shed light on the execution issues.4 According to the research, the three main barriers for sustainable performance management systems, which are essential for strategy execution, are:

1. Lack of experience and understanding of principles within the organization.

2. Lack of capacity, in terms of resources, availability of data and technology.

3. Lack of motivation to use results-based information.

To understand why they are significant, we ought to understand the context of strategy work.

Public vs. Private Sector Context

The public and private sectors are different. Here we are focusing on four areas that affect the public sector strategy execution the most:

Influence

At its core, the public sector strategy is to “build a better, sustainable community.” Most of the long-term goals are broad in nature at the community level. For example, if it is in the strategic plan, one of your goals could be building a healthy and greener city; or in the climate change plan, a goal could be reducing community greenhouse gas emissions; or in an economic development strategy, building an entrepreneurial ecosystem. Those goals identify the areas where opportunities lie. But what’s the role of our public organizations in each of the areas? Has the strategy sufficiently considered what is within the organization’s control and influence when committing to those goals?

The local government plays an integral role in building the community, but the role sometimes varies depending on the issue and your community. So, when people formulate a strategy, envisioning a future without properly analyzing (or at least considering) the impact of our own actions due to lack of understanding and experience of the uniqueness of public sector strategy, is one of the reasons why strategy is not executed as expected.5

Prioritization

I rarely see a local government that has one or only a handful of services. Many services are legislated by law, such as elections, economic development, land-use planning, tax collection, and many are desired by the community, such as fire, transportation, police, and childcare. Also, unlike the private sector, public organizations must aim to serve everyone within the mandate; we must consider vulnerable populations and can’t just leave people behind. Lastly, our staff is busy. Projects related to executing the strategy are just a small portion of staff work. The majority is the operational work that is often not observable. They are busy with implementing or closing prior strategy projects, delivering day-to-day services, handling politically sensitive projects, and being good team players supporting other orders of governments, peer cities, community partners, or other departments, among many other things. Executing the strategy could be seen as just another area of work landing on their desk.

Effective prioritization in such a context is quite challenging. It requires sufficient data and thorough situational analysis (also known as environmental scanning) to identify and clarify (as much as possible) the strategic issue(s)6 amongst the multiple lines of services and the diverse population, and then pick and choose actions that are based on impact and not just alignment.7 It also requires the consideration of organizational capacity. To implement the strategy, the organization needs to have sufficient capacity either from reallocating existing resources, from adding new resources (such as new tax levy), or from other means.

For example, in the face of the climate emergency, climate change may be identified as one of your strategic issues. If you were to formulate a climate change strategy, then you will need an analysis to indicate why climate change is a priority—why it matters to the community, then within the issue, what are the right actions understanding each community is different:

• Is it climate mitigation, in terms of avoiding or reducing emissions, or climate adaptation, in terms of adjusting to the effects of climate change?

• Should we base our strategy on actions within the administration’s control, such as the administration’s own mitigation and adaptation actions, or on actions in collaboration with others in the community?

The answers should not be based on alignment, a list of actions that shows relevance, but should be based on impact, an evaluated list that shows effect. Last but not the least, can we implement either using existing resources or must we use new resources? Are we prepared to reallocate? Are elected officials prepared to justify the rising taxes or is it the right decision to drop certain work (through reallocation)? Any of the aforementioned questions not answered would jeopardize effective prioritization. So, another reason a strategy may not be executed as expected is that analysis is not done properly due to lack of understanding and experience of uniqueness of public sector strategy, or lack of capacity in terms of resources or data.

Governance

Elected officials are chosen by the people to represent their interests and to make policy decisions. What is often overlooked in this process is that they are also the “board of directors” of a public organization and have a governance role they ought to play. After winning the election, they may receive an orientation session about the ethics and their roles and responsibilities, which helps provide guidance in representation, policy making, and hopefully how to have an effective council-staff relationship. But this leaves a significant skill and mindset gap in terms of governing and championing a public sector strategy versus simply approving one, which speaks to the first barrier of why strategy is not executed as expected.

Knowledge and Motivation

The staff plays a critical role in execution. They get the work done, collect the data, and have the results reported. To execute the strategy successfully, people need to have the skills to do what they are expected to do and have opportunities to contribute, not to mention that the strategy has to resonate and staff can see leaders, colleagues, and others start to behave differently. But even at the moment you are reading this article, we can barely find a public sector strategy course in our education institutions, which creates many challenges for those who are practicing strategy.

People are good at driving because we do it all the time and get instant feedback. Strategy, not so much. Even the most seasoned managers might get to see a handful of strategies from start to finish over their careers. That’s not much practice.

In public organizations, there is also a tendency to treat the work as the project of the year; a piece of work that happens at a point in time. But how would that help with execution that occurs at a later date after the strategy is approved, not to mention the impact may take months if not years to realize and be reported? Insufficiently addressing organizational context, in terms of knowledge and motivation, speaks to all three barriers.

Implications

It is obvious that the aforementioned factors are shaping how we execute strategy in the public sector. We cannot just copy and paste what is done in the private sector without acknowledging the context of the public sector and not knowing our own organizational and community context where the strategy lives. For a public sector strategy to be a success:

1. It needs to recognize the varying role the strategy asks the organization to take on and consider the organization’s impact.

2. It needs to prepare decision-makers for making a tough prioritization decision (while they approve the strategy) based on evidence in addition to individual values and voices.

3. It needs to consider the understanding of the governance role by elected officials and enhance strategy literacy8 over time.

4. It needs to address the organizational context where the strategy lives.

Based on the public sector context, a set of actions are required (Table 1). Some actions are one-time, situational to the strategic issue and the strategy (Action 2)9 while some require ongoing development, building organization maturity over time (Action 1 and 3).

Individual capacity building includes multi-pronged training: governance development for elected officials, leadership development for executives, and technical skill development for staff. In many cases, there may be a need to upgrade the knowledge for strategists. Most critically, the roles have to be in sync because strategy is not inherently valuable. Value really comes from the coordination of roles and the consistency in functions as a result of strategy. Simply put, a chain is only as strong as its weakest link.

Action 2 calls for an integrated approach for analysis. While customer insight and environmental scanning are prevalent in the private sector, sometimes both are missing in the public sector strategy formulation process. Impact assessment evaluates the potential impact (community outcomes) based on the proposed strategy and cross-references with the original strategic issue.

A two-way approach working with staff involves leveraging subject matter expertise throughout the process; demystifying performance management and developing individual capacity to implement, measure, and report strategy. Over time, the staff wouldn’t see formulating and executing the strategy as another job landing on their desk, but the way they manage their work and how they “build a better, sustainable community.”

We have gone through two iterations of strategy development approaches, moving from strategic planning to strategic management, and are experiencing another—strategy management. We have learned a lot from the private sector and possibly our own successes and lessons. Maybe it is time to make something of our own that fits the unique context we face in the public sector. Maybe it is time to find a “strategy” that helps develop your own.

 

KEL WANG is the founder and CEO of fioh Strategy—we innovate strategy and build capacity for the public sector. He also serves on the ICMA Performance Management Advisory Committee. (kel.wang@fiohstrategy.com)

 

 

 

Endnotes and Resources

1 Together, strategy formulation and execution is known as strategic management.

2 Mark H. Moore, Creating Public Value: Strategic Management in Government, 1995.

3 For more information about the definition of strategists, please read “The Evolving Role of Strategists,” Kel Wang, PM magazine, June 2021, https://icma.org/articles/pm-magazine/evolving-role-strategists.

4 Source: Obstacles and opportunities for sustaining performance management systems by Marc Holzer and others, 2017.

5 A clear signal of this is no measure is identified for the strategy.

6 Strategic issues are issues that matter greatly to the current and future community. They are the results of a comprehensive environmental scan and the origin of a strategy.

7 Alignment indicates the action contributes to or helps address the strategic issue, but the effect of the action is not considered. Impact indicates both the relevance and the effect.

8 Strategy literacy is the ability to understand and use strategy as a tool to achieve desired results.

9 The organizational uptake and capacity for Action 2 can be developed through Action 1 as well.

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