Review Your Strategy: when it still holds and when it's out of date

When should you review a strategy?

On three occasions, and only the first one is in the calendar.

• Annually, in full. Half a day in which the assumptions go on the table, not the measures. Better not to schedule it during the budget round: there, the question about next year beats every question about direction.
• Quarterly, briefly. One hour on the progress of your initiatives. That's an execution question, not a strategy question. But it produces the observations the annual meeting works with.
• Ad hoc, immediately. A major customer gets acquired, a competitor disappears or gains a deep-pocketed owner, a regulation changes the rules, a technology suddenly becomes available for your product. Events like these change an assumption, and at that point the calendar isn't in charge.

What doesn't count as a trigger: a bad quarter. Numbers fluctuate, and a strategy that gets questioned after every weak quarter is never pursued long enough to work.

Why test assumptions instead of numbers?

Because numbers arrive too late. Revenue and earnings show the result of decisions that are one to three years old. By the time they drop, the cause has long since taken effect. And usually it's no longer cheap to fix.

Assumptions show it earlier. Every strategy rests on a handful of statements that were plausible at the time of the decision: that this market keeps growing, that customers still won't want to deliver this service themselves, that the price gap to the competition holds, that you can build this capability. These statements can be observed one by one.

That assumes they were written down. This is where it falls apart in practice: most strategy papers contain the conclusions, not the premises. If you start after the fact, it takes two hours. The group that made the decision can still name the assumptions if someone asks.

A simple list helps: the assumption, how you'll recognize a change, who's watching. Five lines. This list is the actual review instrument and the first document on the table in every review.

Which signals show that the assumptions no longer hold?

The most reliable signals come from sales and from lost deals, meaning from people who aren't in the strategy meeting.

The last row is the most common one, and the one most often treated as a strategy question. If an initiative isn't moving because nobody had time, the strategy isn't wrong. It's untouched. Telling the two apart is the main job of the review.

How do you run a review that doesn't turn into a status report?

With a fixed sequence and with prep work that's done before the meeting. Half a day is enough if nobody does research during the session.

• First: go through the assumptions. Each assumption gets one of three labels: holds, wobbling, obsolete. No discussion of measures, just the assessment with evidence.
• Second: check what you said no to. What did we decide not to do? And did we actually leave it alone? This question exposes faster than any other whether the strategy had an effect in daily business.
• Third: initiatives. Done, running, stalled. For "stalled," name the cause: capacity, capability or will. All three require different answers.
• Fourth: the decision. Continue as is, adjust or start over. A review without one of these three statements was a conversation.

It turns into a status report the moment you start with the initiatives. Then the time goes into progress updates, and the assumptions come up in the last half hour, when everyone is already watching the clock. So the order is not a matter of taste.

What separates course correction from a new strategy?

The answer comes down to exactly one question: is one of the load-bearing assumptions outdated, or was it execution that fell short?

Course correction means the direction stays, the path changes. An initiative gets replaced, a priority moves, a segment is cut differently. That is the normal case and happens in almost every annual review.

Starting over means the target picture or the trade-offs no longer hold. That happens less often than leadership teams discuss it, and it is expensive. A strategy process costs a leadership team three to six months of attention. So that decision needs a reason: which assumption failed, and what follows from it that the existing strategy cannot accommodate.

The third case is the one most often confused with the other two: the strategy is right and was never executed. In that case, a new strategy is the most expensive thing you can do, because it creates the same execution gap a second time, with the added damage that the organization learns strategies get swapped out every two years anyway.

Who belongs in the review?

The same group that made the decision. Anyone who did not help set the assumptions will struggle to judge them. And anyone who never had to judge whether their assumption held will make another convenient one next time.

Add two people who make the difference: someone from sales who actually talks to customers and does not just report the numbers, and someone who takes notes. Those notes are about the assumption list with the new marks and evidence, not about completeness. It is the only document that has to leave the meeting.

And one person who facilitates without deciding at the same time. In the annual review that matters less than in the strategy process itself, but it helps at the point where an uncomfortable assumption is on the table. That is exactly where the group tends to move on quickly.