See discussions, stats, and author profiles for this publication at: https://www.researchgate.net/publication/251880254 Strategy as a Wicked Problem Article in Harvard business review · May 2008 CITATIONS READS 383 2,256 1 author: John C. Camillus University of Pittsburgh 42 PUBLICATIONS 1,830 CITATIONS SEE PROFILE All content following this page was uploaded by John C. Camillus on 15 November 2019. The user has requested enhancement of the downloaded file. www.hbr.org “Wicked” problems can’t be solved, but they can be tamed. Strategy as a Wicked Increasingly, these are the problems strategists face— Problem and for which they are ill equipped. by John C. Camillus Reprint R0805G This article is made available to you with compliments of John Camillus. Further posting, copying or distributing is copyright infringement. To order more copies go to www.hbr.org or call 800-988-0886. “Wicked” problems can’t be solved, but they can be tamed. Increasingly, these are the problems strategists face—and for which they are ill equipped. Strategy as a Wicked Problem by John C. Camillus Over the past 15 years, I’ve been studying how clearly, or breaking them down into small companies create strategy—the most impor- problems. Their planning techniques don’t tant responsibility of senior executives. Many generate fresh ideas, and implementing the corporations, I find, have replaced the annual solutions those processes come up with is top-down planning ritual, based on macroeco- fraught with political peril. That’s because, I nomic forecasts, with more sophisticated pro- believe, many strategy issues aren’t just tough cesses. They crunch vast amounts of consumer or persistent—they’re “wicked.” data, hold planning sessions frequently, and Wickedness isn’t a degree of difficulty. use techniques such as competency modeling Wicked issues are different because traditional and real-options analysis to develop strategy. processes can’t resolve them, according to This type of approach is an improvement be- Horst W.J. Rittel and Melvin M. Webber, cause it is customer- and capability-focused professors of design and urban planning at and enables companies to modify their strate- the University of California at Berkeley, who gies quickly, but it still misses the mark a lot of described them in a 1973 article in Policy the time. Sciences magazine. A wicked problem has in- Companies tend to ignore one complication numerable causes, is tough to describe, and along the way: They can’t develop models of doesn’t have a right answer, as we will see in the increasingly complex environment in the next section. Environmental degradation, which they operate. As a result, contemporary terrorism, and poverty—these are classic ex- strategic-planning processes don’t help enter- amples of wicked problems. They’re the oppo- prises cope with the big problems they face. site of hard but ordinary problems, which Several CEOs admit that they are confronted people can solve in a finite time period by with issues that cannot be resolved merely by applying standard techniques. Not only do gathering additional data, defining issues more conventional processes fail to tackle wicked OPYRIGHT © 2008 HARVARD BUSINESS SCHOOL PUBLISHING CORPORATION. ALL RIGHTS RESERVED. OPYRIGHT © 2008 HARVARD BUSINESS SCHOOL PUBLISHING CORPORATION. C harvard business review • may 2008 page 1 This article is made available to you with compliments of John Camillus. Further posting, copying or distributing is copyright infringement. To order more copies go to www.hbr.org or call 800-988-0886. Strategy as a Wicked Problem problems, but they may exacerbate situations unprecedented challenges. They occur in a so- by generating undesirable consequences. cial context; the greater the disagreement In the areas of public policy, software devel- among stakeholders, the more wicked the opment, and project design, experts such as problem. In fact, it’s the social complexity of Peter DeGrace, Leslie Hulet Stahl, and Jeff wicked problems as much as their technical Conklin have developed ways of spotting difficulties that make them tough to manage. wicked problems and coping with them. De- Not all problems are wicked; confusion, dis- Grace and Stahl wrote Wicked Problems, Righ- cord, and lack of progress are telltale signs that teous Solutions: A Catalogue of Modern Software an issue might be wicked. Engineering Paradigms (1990); Conklin au- In my consulting work, I’ve found that when thored Dialogue Mapping: Building Shared Un- five characteristics are present in a strategy- derstanding of Wicked Problems (2006). Policy related issue, executives agree they have a makers, in particular, have put this powerful wicked problem on their hands. I’ll list the key concept to good use, but it has been largely criteria below and use them to show how the missing from strategy discussions. Although challenge of growth that Wal-Mart faces today many of the problems companies face are in- may well be wicked. tractable, they have been slow to acknowledge The problem involves many stakeholders the wickedness of strategy issues. with different values and priorities. As Wal- Between 1995 and 2005, I completed three Mart tries to grow faster, numerous stakehold- research projects that provided insights into ers are watching nervously: employees and wicked strategy problems. First, as part of trade unions; shareholders, investors, and benchmarking projects that the APQC (for- creditors; suppliers and joint venture partners; merly known as the American Productivity & the governments of the U.S. and other nations Quality Center) and the Hong Kong Productiv- where the retailer operates; and customers. ity Council conducted, I analyzed 22 North That’s not all; many nongovernmental organi- American, European, and Asian enterprises zations, particularly in countries where the re- that use innovative strategic-planning tech- tailer buys products, are closely monitoring it. niques. They include ABB, Alcoa, Honeywell, Wal-Mart’s stakeholders have different inter- John Deere, PPG Industries, Royal Dutch ests, and not all of them share the company’s Shell, Siemens, Sprint, Whirlpool, and Xerox goals. Each group possesses the capacity, in (China and USA). Second, I studied strategy varying degrees, to influence the company’s implementation in depth at seven of these en- choices and results. That wasn’t the case in terprises. Third, a colleague, Gaurab Bhardwaj, 1962, when Sam Walton set up his first store in and I tracked DuPont’s pharmaceuticals busi- Rogers, Arkansas. ness to learn how companies draw up strate- The issue’s roots are complex and tangled. gies when returns will accrue only in the long Wal-Mart’s slowing growth in the U.S. is a con- run and are highly uncertain. Based on these sequence of, among other things, a saturated studies, I’ll explore in the following pages how market, its customers’ limited disposable in- companies can tame—since they can’t solve— comes, and intense competition from rivals such problems. I’ll conclude by describing a such as Target and Costco. Wal-Mart also faces planning process that helps PPG Industries resistance to imports, criticism about the tackle wicked issues. wages and benefits it offers employees, and charges that illegal aliens work in its stores. All What Is a Wicked Problem? this has generated unfavorable publicity and There are several ways to define a wicked strengthened people’s opposition to Wal-Mart’s problem, but according to Rittel and Webber, opening stores in urban areas. Compounding it has some or all of 10 characteristics. (See the the challenge, some of the company’s advan- sidebar “The 10 Properties of Wicked Prob- tages have turned into disadvantages. For in- lems.”) Caveat: The criteria are not a set of stance, Wal-Mart’s large market share in some John C. Camillus ([email protected]) tests that mechanically determine wickedness; product categories makes it tough to grow is the Donald R. Beall Professor of Stra- rather, they provide insights that help you same-store sales rapidly. Its low-cost sourcing tegic Management at the University of judge whether a problem is wicked. practices have rendered it vulnerable to the Pittsburgh’s Joseph M. Katz Graduate Wicked problems often crop up when or- health and safety concerns that surround School of Business. ganizations have to face constant change or products made in China. Its supply chain harvard business review • may 2008 page 2 This article is made available to you with compliments of John Camillus. Further posting, copying or distributing is copyright infringement. To order more copies go to www.hbr.org or call 800-988-0886. Strategy as a Wicked Problem expertise doesn’t help in the case of fashion boosting profits immediately. Alternatively, and organic products, and its low-price image Wal-Mart could enter a fast-growing emerging hurts its ability to sell upscale products. More- market, as it has done in India. It has found the over, Wal-Mart’s deep roots in rural America going tough there, however. In India, local are of little use in overseas markets. laws don’t allow foreign companies to operate The problem is difficult to come to grips multibrand retail outlets, so Wal-Mart has had with and changes with every attempt to ad- to develop a special business model: cash-and- dress it. Wal-Mart has several options. It can carry wholesale stores for local retailers. Be- try to boost revenues and profits by increasing sides being unfamiliar, the strategy contains sales from existing stores or raising prices, by the nucleus of another problem. When India’s expanding into urban markets in the U.S., by laws change and allow Wal-Mart to sell to entering emerging economies, by diversifying consumers, it will have to compete with the into upscale product lines and creating new retailers it supplies. store brands, by forecasting better, or by cut- The challenge has no precedent.