Decomposable strategy problems
2/6/2025 ☼ strategy ☼ public sector ☼ uncertainty ☼ tradeoffs ☼ coordination
This week I was in Healdsburg hanging around at Edge Esmeralda. Several of the conversations I ended up in were about the conundrums and unsolved challenges of public sector work. In a session about a large public sector utility — let’s call it UtilCo — there was a wide-ranging discussion of the intractable issues UtilCo faced. UtilCo has to herd many cats (the different agencies it must work with), it lacks digitised map resources that can be easily accessed and distributed to UtilCo’s end-users in emergencies, etc.
Later that day, I reflected on how the issues raised actually fell into five different conceptual categories: Coordination, strategy, category, capability, and tradeoff. Each category requires a different approach to solution, addressing, or accommodation — and each category affects the others. (This is eerily similar to the work I’m doing on conceptual clarity for non-risk forms of not-knowing.)
How big, difficult problems decompose into smaller, more tractable ones.
Problems, problems, problems
Coordination problems: UtilCo has more than 20 member agencies and serves tens of millions of people across an area spanning thousands of square miles. It’s hard to get its constituent parts to agree (or agree to disagree) on what actions to take separately and together and then to take those actions.
Strategy framework problems: A public sector, long-horizon, water management organisation like UtilCo still does strategy today with strategy frameworks originally developed from studying American industrial/manufacturing corporations in the 1950s. (It is particularly incomprehensible to me that public sector strategy defaults to using private strategy frameworks.)
Category problems: UtilCo makes long- and short-term decisions using frameworks like cost-benefit analysis or expected value analysis that implicitly assume that unknowns are precisely and accurately quantifiable (i.e., formal risk). But nearly all the unknowns a large public sector organisation faces are not quantifiable precisely and accurately (i.e., true uncertainty) and demand different decision-making approaches. When unknowns are miscategorised, we use the wrong decision-making approaches to respond to them.
Capability problems: Organisations often lack resources or capabilities — whether those are trained humans, tools, or information — that would make their work more efficient and effective. For instance, UtilCo’s water system information is not digitised in ways that make it easy for people to identify when their specific water supply is affected by a safety problem.
Tradeoffs problems: The biggest, most foundational problem is that tradeoff configurations aren’t made explicit and negotiated between UtilCo’s member agencies. Tradeoffs are desirable outcomes that we’re willing to sacrifice in pursuit of even more desirable outcomes. It’s easy to agree on shared high-level goals while disagreeing on what tradeoffs to make in pursuing those shared goals. These hidden misalignments are everywhere in organisational life, but especially so in the public sector given its size and distributedness. (And focusing on objectives while ignoring tradeoffs is one of the most pervasive problems in strategy.)
Decomposing monolithic problems
Seeing all these issues as being conflated with each other — as monolithic “public sector problems” — makes them seem harder to address than they actually are. Breaking them apart into different types makes them both conceptually and practically more tractable.
In particular, the tradeoffs problems are simple to tackle: Create space in which stakeholders articulate what their tradeoff configurations are, and are pushed to explicitly justify those tradeoff configurations to each other.
There are probably many ways to do this, but I’ve been running a 1-day tradeoffs workshop called Boris for over a decade. Boris is specifically designed to surface tradeoffs and hidden misalignments about tradeoff configurations among stakeholders, and it transforms how stakeholders view their own priorities in the context of others’ priorities. In turn, this makes it possible for stakeholders to rethink what it means to work together, and to use existing resources and constraints on action in creative and unexpectedly productive ways.
I’ve found that these five types of issues are always interconnected in practice … and that tradeoffs are the easiest, highest-leverage, least intimidating way to unblock the logjam and thus to make progress on the other types of issues.
Get in touch if you’re interested in exploring how to talk about tradeoffs in your organisation.
I’ve been working on tools for learning how to turn discomfort into something productive. idk is the first of these tools.
And I’ve spent the last 15 years investigating how organisations can design themselves to be good at working in uncertainty by clearly distinguishing it from risk.