What Makes a Strategy Good (or Bad)?

What Makes a Strategy Good is a question that many leaders, teams, and organizations struggle to answer. Too often, strategies are little more than vague aspirations, broad mission statements, or a collection of disconnected initiatives. A true strategy, however, requires more than just setting ambitious goals—it demands a deep understanding of the environment, deliberate choices, and a clear plan of action.

A good strategy is not just about deciding what to do but also what not to do. It acknowledges constraints, adapts to external forces, and aligns actions with a coherent guiding policy. This is where concepts like landscape (the competitive and technological environment) and climate (external trends and inevitable changes) come into play. While this post is not about Wardley Mapping, we will draw from its insights to highlight why a good strategy must be grounded in reality.

In this post, we’ll break down the essential elements of a strong strategy, common pitfalls that lead to weak or failing strategies, and practical ways to improve strategic decision-making. Whether you’re leading a business, a product, or a team, understanding what makes a strategy good is key to making smarter choices and achieving long-term success.

What Strategy Is (And What It’s Not)

Let’s start by clearing up a common misunderstanding: strategy is not the same as a plan. A plan is a set of actions to achieve a goal, but strategy is about the reasoning behind those actions. Strategy defines why certain choices are made and what trade-offs are accepted.

Here’s what strategy is not:

❌ A list of goals – “We want to be number one in the market” is a wish, not a strategy.
❌ A to-do list – “We will launch three new products and expand to five markets” is execution, not strategy.
❌ A generic vision statement – “We strive to deliver the best service” lacks focus and direction.

A real strategy must answer three key questions:

1. What is the problem or opportunity we are addressing?
2. What is our approach to solving it?
3. What coordinated actions will make this happen?

The Core Elements of a Good Strategy

A strong strategy is built on three foundational elements:

1. Clear Problem Definition

If you don’t understand the problem, you can’t craft a meaningful strategy. Many strategies fail because they address symptoms rather than root causes. Take the time to analyze why a challenge exists and what forces shape it.

👉 Example: Instead of “We need to improve customer retention,” ask, “Why are customers leaving?” Is it pricing, experience, or competition?

2. Guiding Policy

This is the overarching approach or principle that shapes decisions. It ensures consistency and alignment across actions. A good guiding policy is simple but powerful—it provides direction while leaving room for flexibility.

👉 Example: A company struggling with slow software releases might adopt a guiding policy of “Automate everything that slows us down.” This will drive decisions on tooling, workflows, and team structures.

3. Coherent Actions

Actions must be connected to the guiding policy and reinforce each other. A weak strategy lists activities without linking them to an overarching direction.

👉 Example: If your guiding policy is automation, your actions might include investing in DevOps, reducing manual testing, and restructuring teams for continuous delivery. These actions work together instead of competing with each other.

The Role of Landscape and Climate in Strategy

This is where we borrow insights from Wardley Mapping to make strategies stronger.

1. Understanding the Landscape

Your landscape is the competitive and technological environment in which you operate. It includes your customers, competitors, suppliers, and the evolution of key technologies.

A strong strategy maps this landscape before making decisions. You need to understand:

• Where you have a competitive advantage
• Where you are weak
• What components of your business are evolving from custom-built to commodity

👉 Example: Cloud computing moved from a niche technology to a commodity. Companies that recognized this shift early could focus on value-added services instead of maintaining data centers.

2. Responding to Climate Forces

Climate is the set of external forces that will shape the future, whether you like it or not. Some changes are inevitable, and a good strategy anticipates them.

Some common climate forces:

• Technological shifts (e.g., AI, automation)
• Regulatory changes (e.g., data privacy laws)
• Market trends (e.g., customers shifting to subscription models)

Bad strategies ignore climate forces and act as if the world is static. Good strategies embrace reality and evolve accordingly.

What Makes a Strategy Bad? (The Pitfalls to Avoid)

Now that we know what makes a strategy good, let’s talk about what makes a strategy bad.

1. No Clear Focus

Trying to do everything leads to a diluted, ineffective strategy. If you prioritize everything, you prioritize nothing.

👉 Example: A company trying to be premium, budget-friendly, innovative, and stable all at once will fail at all of them.

2. Ignoring Market and Technological Shifts

Many failed companies were not beaten by competitors but by failing to adapt to changes in climate.

👉 Example: Kodak had the technology for digital photography but ignored the shift because it threatened their film business.

3. Copying Someone Else’s Strategy

A strategy that works for one company might not work for another. Your landscape, position, and climate are different.

👉 Example: Many companies tried to “be like Apple” by focusing on design without having Apple’s ecosystem, brand loyalty, or supply chain control.

4. Strategy as a Buzzword Exercise

If your strategy can be applied to any company, it’s probably meaningless. Real strategies make tough choices and sacrifices.

How to Build a Better Strategy

1️⃣ Analyze Your Landscape – Understand your competitive environment.
2️⃣ Identify Climate Forces – Spot external changes that will shape your future.
3️⃣ Define a Clear Problem – Know exactly what challenge or opportunity you are tackling.
4️⃣ Set a Guiding Policy – Make a clear, principle-driven decision about how you will act.
5️⃣ Ensure Coherent Actions – Link every action back to the guiding policy.

Strategy is not about making predictions; it’s about positioning yourself to succeed no matter what happens.

Conclusion: Strategy Is a Living Thing

A good strategy is never static—it evolves as the landscape and climate shift. The best strategies make hard choices, focus on a real problem, and align actions with a guiding policy.

A bad strategy, on the other hand, is vague, reactive, and disconnected from reality. It lacks focus, ignores external forces, and fails to guide execution.

So before crafting your next strategy, ask yourself:

• Are we making deliberate choices, or just listing aspirations?
• Do we understand our landscape and climate?
• Are our actions reinforcing each other, or are they scattered?

By thinking strategically—instead of just planning aimlessly—you’ll be in a much stronger position to drive meaningful results.

Here are three books to deepen your understanding of strategy:

1. 📖 Good Strategy/Bad Strategy – Richard Rumelt
   Why read it? This book clearly distinguishes between real strategy and fluff. Rumelt breaks down what makes a strategy effective, using real-world examples to illustrate the difference between strong guiding policies and empty aspirations.
2. 📖 The Art of Strategy – Avinash K. Dixit & Barry J. Nalebuff
   Why read it? This book applies game theory to strategic decision-making, helping you think about competition, cooperation, and long-term positioning in a structured way.
3. 📖 Wardley Maps: Topographical Intelligence in Business – Simon Wardley
   Why read it? While not a traditional strategy book, this provides a unique perspective on mapping competitive landscapes and responding to climate forces—essential for strategic thinking in evolving markets.