Do we really need a Chief Strategy Officer?

After taking a break last post to review Open Leadership, by Charlene Li, I want to return to corporate strategy.

For those of you keeping score, I spent a few posts walking through a hands-on approach to building out strategy that I’ve used successfully at many clients.

Today, however, I want to step back a bit and get a little philosophical by considering whether strategy is something organizations should address through a dedicated department that rolls up to a Chief Strategy Officer.

Spoiler alert: I don’t have a definitive answer. So if you’re looking for one, you need to go somewhere else. But I have some thoughts on the matter that I want to explore a bit here.

The numbers

Being a recovering academic, I figured I’d start with some research by combing LinkedIn for a variety of CXO titles to see how many results came back. Here’s what I found:

The first thing to notice for this discussion is that CSO numbers are in line with the other “optional” CXOs like CROs, CCOs, and both CLOs: the ones that are nice to have at an organization—if circumstances warrant it.

The other thing to notice (and take with a grain of salt) is the number of Chief Legal Officers. This term is used synonymously with General Counsel, the latter being the preferred term, even at large corporations—so 2,761 is a misleading number for this position.

Isn’t strategy important?

The lower numbers of CSOs could be saying a couple of things. It could be that strategy is a low priority for most organizations—which I think is wrong. Just about every organization is concerned with strategy and spends a lot of time on it (whether they are any good at it is another issue).

It could also be that organizations just aren’t sure how a CSO would fit into the rest of their C-level suite: would there be a dedicated team of strategists? A matrixed team drawn from the rest of the organization? Some hybrid of the two?

To me, this is the more likely answer, because creating a CXO role at an organization is a big deal with big-time organizational consequences. Unless the value of that CXO is absolutely clear to executive leadership (or the CEO woke up and decided that she needs a CSO, CRO, or CCO on her team), the role won’t just organically come into being.

Strategy is everyone’s business

In thinking about it, I see a number of questions that an organization needs to answer when considering a CSO position

  • Will the CSO be responsible for all strategy at the organization, in the same way that a centralized PMO is responsible for all project management?
  • Will they be responsible only for corporate level strategy, leaving departmental level strategy to the LOBs?
  • Will they be responsible for strategy as an enterprise capability, developing the methods and tools that the rest of the organization will use to build specific instances of strategy?
  • As an organization, are we ready to embrace a centralized (or even loosely federated) approach to strategy?
  • As an organization, do we have the discipline to enforce a centralized (or even loosely federated) approach to strategy?
  • Beyond simply “doing strategy better”, what specific goals are we trying to accomplish by creating a CSO position?

Let’s face it, strategy is done at all levels of an organization, from individual project teams, to workgroups, departments, divisions, and major geo locations. Before we go and put a CSO in charge of strategy, we better have a clear idea of exactly how she’s going to be involved (or not involved) in all the day-to-day, distributed strategy going on at the organization. Otherwise, at best we risk adding needless bureaucracy, while at worst we risk undermining how strategy is done at the organization—precisely the opposite of what we intended to do by creating the CSO position in the first place.

The final word

Like I promised, no answers here. But I’d love to hear what folks out there think, especially those of you who have a CSO at your organization—or better yet, are CSOs! So jump in, and let’s get the conversation started…

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3 Responses

  1. Very interesting Joe… I think that one of the main roles of a CEO and his supporting cast (The Board of Directors and other CXOs) is to collectively set corporate strategy. That is why you don’t see many CSO positions out there devoted solely to strategy. Defining a corporate strategy has to be a cooperative effort in order to create “buy in”. In lieu of a CSO, companies oftentimes bring in strategic management consultants who are extremely familiar with the most recent market trends & conditions, competitive forces, industry benchmarks, and anticipated demands of the future. As an objective third party, these consultants help facilitate strategy definition sessions. That is just what I’ve seen from my experience in the industry. But I agree with you… there is no single “right” answer.

  2. Jolanta,

    Great point–I hadn’t thought of the issue from this perspective…and I think you’re dead on…

    Thanks (as always) for jumping in and getting the conversation started!

    Cheers,

    Joe

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