The Challenges with “Predict and Prescribe” as a Strategy Method

A case for Agile Strategic Planning over Predict and PrescribeIn our series on Organizational Agility we wanted to provide some additional information and context to the Predict and Prescribe model. In our 20 years of experience in strategy, we see traditional strategy development consisting of two core principles: 

(1) Obtaining the most accurate data to the unique circumstances of the business is critical; and,  

(2) Strategy defines execution 

At Prosono we call this strategy development model "Predict and Prescribe."  It is a model that uses past and (previously) accurate data and assumptions to prescribe, fix, or adjust a path forward for the future. To learn more about our alternative method that we call Organizational Agility, check out this post.  

In today’s environment we are seeing an absence of accurate data and valid assumptions that previous models were built on.  In fact, unless you have a crystal ball, the Predict and Prescribe model, and its core principles, are threatened by today’s uncertainty. To dive deeper into this model, we have highlighted some of the key elements that are being challenged today. 

First, we have the principle of "accurate data,which is core to all professional consulting.  It is the reality that years of building data sets in a certain environment or situation can help us "predict" the likely future in other similar scenarios.  This has been the value proposition of so many large professional services firms - both on the manufacturing and development side as well as in professional services.  Big Consulting firms generate large amounts of data through their work with their clients and use this data to support their client's strategy, which is also why they demand a high bill rate. And, frankly, they have that right, as the Intellectual Property (IP) is amazing. This data and its corresponding trends have guided many firms to strong results and profits.   

While many organizations have never been able to afford access to this type of data we are also seeing a trend in organizations trying to get away from their existing models in search of being more adaptable to the needs of clients, the market, and multi-level competition – even before COVID-19. Since COVID-19, we have seen more and more business leaders attempting to make sense of what the future holds and an increasing distrust of the data they have used in the past. 

Second, the Predict and Prescribe model is unhampered from implementation.  This model expects strategy to be clean, simple and out of the execution and delivery weeds, as it "prescribes" what is needed to be done.  Delineation between strategy (the leadership team identifies) and execution (the implementation team carries out) has merit when accurate and reliable data is available for prediction. For example, if your business had increased 60 percent year over year through investing in 2 or 3 key services of your business, you are likely to continue that investment until that growth slows. This model assumes that if you preformed this way under these constructs and conditions, you should be able to perform the same or better during the subsequent time frame.  

When the models and data you have previously used to help prescribe your business strategy have started to be called into question it is time to seek a different way of developing your strategy.  To learn more about Prosono’s Organizational Agility strategy model and why learning by doing is a potential model to replace the Predict and Prescribe model check out our blog post here.