Imagine an athlete in training to run a ten mile foot race. The race will be run in a very hot, tropical place, and it will be necessary for him to run up and down large mountains. But to prepare for this long race, the athlete is doing resistance training and sprints in the gym. His outdoor training consists of half-mile runs through snow drifts in a large flat paddock during the middle of winter.
This athlete is in strategic misalignment. He is training to develop resources and capabilities (a sprinter’s power and bulk) that do not match his strategy (to run a long race) or his environment (a race that will occur in a hot, humid mountainous place). This athlete may be fit – because he trains – but he is not “in fit.” His strategy, his internal resources and his environment are not aligned.
Organizations have to address this issue too. Their competitive strategy must fit their environment and it must be matched and supported by the internal attributes of the company.
This is not easy. AOL, once the company that defined the internet for millions of Americans, failed to alter its strategy when the market moved away from dial-up internet subscription in the early part of this century. They kept sending out the free connection diskettes, trying to charge for content within their “walled garden” while the big wide free internet and broadband internet access burgeoned. The misalignment was left unchecked until it was too late to rectify, and the company has been dealing with the consequences ever since.
The music industry has been forced to make massive strategic changes in order just to survive. But a closer look at the internal workings of these companies reveals that, whilst they may have hired some more tech-savvy people than before and restructured a little, they are still hiring the same sort of people as before and maintaining the same sort of organizational culture as served them well in the 1980s and 1990s. The world has changed dramatically for them, but their new strategic imperative of competing in a digital world is not being matched by changes in how the company is run internally. This fundamental lack of fit continues to obstruct their efforts to turn around a stagnating business.
This problem is getting more difficult to manage because, in the digital world, the competitive environment changes quickly. Thus, everything around that environment needs to change quickly too. Strategies are reasonably easy to change. But it has never been easy to change an organization or its people quickly. The quest for strategic alignment is as important as ever for the modern organization, but is now even harder to develop and maintain.