Strategic Thinking Glossary 

This glossary defines the essential terminology used throughout the book, providing a quick reference for key concepts in strategic thinking.

A - C

• Action learning projects: Real-world projects designed to stretch strategic capabilities and apply frameworks in practice.
• Advocacy: Stating one's views and arguing for them in a dialogue or discussion.
• After-Action Review (AAR): A structured reflection process to review what happened, why, and what to learn.
• Ambidextrous organization: An organization that excels at both exploiting existing capabilities and exploring new possibilities.
• Assumption: A belief taken for granted that may limit strategic thinking or be surfaced and tested in dialogue.
• Balanced Scorecard: A framework for strategic measurement that includes financial, customer, internal process, and learning and growth perspectives.
• Balancing loop: A feedback loop that stabilizes a system, resisting change.
• Baseline: The current level of performance against which progress is measured.
• Blue ocean strategy: A strategy that creates new market space, making competition irrelevant by creating and capturing new demand.
• Brainstorming: A group ideation technique that defers judgment and encourages quantity of ideas.
• Call to action: A clear request for the audience to take specific steps in a strategic story.
• Circle of competence: The boundary of your expertise; operating within it reduces mistakes.
• Cognitive bias: A systematic pattern of deviation from rationality in judgment.
• Community of practice: A group of people who share a common interest and learn from each other through regular interaction.
• Confirmation bias: The tendency to seek and interpret information that confirms existing beliefs.
• Convergent thinking: Evaluating, selecting, and refining ideas to converge on a solution.
• Creative problem-solving (CPS): A structured approach to generating innovative solutions for complex, ill-defined problems.
• Critical uncertainties: Key drivers that are both highly important and highly uncertain in scenario planning.

D - F

• Delays: The time lag between a cause and its effect in a system.
• Deliberate practice: Intentional, focused practice on specific aspects of performance with the goal of improvement.
• Development plan: A structured approach to identifying learning goals and creating a path to achieve them.
• Distributed leadership: Empowering people at all levels to make decisions within clear boundaries.
• Divergent thinking: Generating many different ideas or possibilities without immediate judgment.
• Drivers of change: The forces that shape the future, such as technology, demographics, and geopolitics.
• Dynamic capabilities: Organizational routines that enable sensing, seizing, and transforming.
• Emergence: The appearance of behavior at the system level that cannot be predicted from the parts alone.
• Environmental scanning: Systematically monitoring trends and weak signals in the external environment.
• Execution gap: The difference between a strategic plan and its successful implementation.
• Facilitation: The practice of guiding a group conversation to keep it productive and inclusive.
• Feedback loop: A circular process where a change in a variable affects other variables, which in turn affects the original variable.
• First principles thinking: Breaking a problem down to its fundamental truths and reasoning up from there.
• Five Whys: A technique of asking "why" repeatedly to uncover root causes and underlying assumptions.
• Flywheel effect: A virtuous cycle where small wins build momentum and accelerate success.
• Foresight: The ability to systematically explore multiple plausible futures to inform present decisions.
• Four Actions Framework: A tool for creating blue oceans through Eliminate, Reduce, Raise, and Create.

G - L

• Game theory: The study of strategic decision-making in interdependent situations.
• Groupthink: The tendency for cohesive groups to suppress dissent in pursuit of harmony.
• Guide: In strategic storytelling, the leader or organization that helps the hero overcome obstacles.
• Hanlon's Razor: "Never attribute to malice that which is adequately explained by incompetence."
• Hero: In strategic storytelling, the central character—often the customer or employee.
• Hierarchy: A system of ranking and authority that can inhibit open dialogue.
• How might we... (HMW): A question format that frames problems in a generative, open-ended way.
• Inquiry: Asking questions to understand others' views in dialogue.
• Inversion: A mental model that involves asking how to achieve the opposite of your goal to identify hidden risks.
• Iteration: The process of repeatedly testing and refining ideas based on feedback.
• Key Performance Indicator (KPI): A measurable value that demonstrates how effectively an organization is achieving key objectives.
• Lagging indicators: Metrics that measure past outcomes (e.g., revenue, profit).
• Leading indicators: Metrics that predict future outcomes (e.g., customer satisfaction, employee engagement).
• Learning culture: An environment where experimentation, reflection, and adaptation are encouraged.
• Learning machine: A person who has cultivated the habit of continuous learning from every experience.
• Lifelong strategist: Someone who continuously develops their strategic thinking capabilities through deliberate practice, reflection, and learning.
• Line of sight: The clear connection between an individual's daily work and strategic objectives.

M - O

• Mental models: Simplified representations of how things work that guide thinking and decision-making.
• Mentor: An experienced person who provides guidance and feedback to a less experienced person.
• Metaphor: A figure of speech that compares two things to create meaning and insight.
• Modularity: Designing systems so that components can be changed independently.
• Narrative: A structured story that connects events, characters, and themes into a coherent whole.
• Nash equilibrium: A game theory concept where each player's strategy is optimal given the strategies of others.
• Objectives and Key Results (OKRs): A goal-setting framework that combines qualitative objectives with quantitative key results.
• Occam's Razor: The principle that simpler explanations are more likely to be true than complex ones.
• Open Space: A self-organizing meeting format where participants create the agenda.
• Operational metrics: Measures that track day-to-day performance and efficiency.

P - R

• Peer group: A network of colleagues at a similar stage who support each other's development.
• Personal agility: An individual's capacity to sense and adapt to change.
• PESTLE analysis: A framework for analyzing Political, Economic, Social, Technological, Legal, and Environmental factors in the macro-environment.
• Plateau: A period in learning where progress seems to stall, often preceding a breakthrough.
• Porter's Five Forces: A framework for analyzing industry competitiveness through threat of new entrants, supplier power, buyer power, threat of substitutes, and rivalry.
• Prisoner's dilemma: A game theory classic where individual rationality leads to a worse outcome for all.
• Prototyping: Creating a simple, low-cost version of a solution to test assumptions and gather feedback.
• Psychological safety: The belief that one can speak up, ask questions, and challenge without fear of negative consequences.
• RACI matrix: A tool for clarifying roles: Responsible, Accountable, Consulted, Informed.
• Red ocean: Existing market space with known boundaries and intense competition.
• Reflection: The practice of thinking critically about experiences to extract lessons and insights.
• Reframing: Changing the way a problem is perceived or defined to open up new solution spaces.
• Reinforcing loop: A feedback loop that amplifies change, leading to growth or decline.
• Resource fluidity: The ability to reallocate capital, talent, and attention quickly.

S - Z

• Safe-to-try experiments: Small-scale tests that allow learning without excessive risk.
• SCAMPER: A checklist of idea-spurring questions: Substitute, Combine, Adapt, Modify, Put to another use, Eliminate, Reverse.
• Scenario planning: A disciplined method for creating and using multiple future scenarios to challenge assumptions and test strategies.
• Second-order thinking: Considering the consequences of consequences.
• Sensing: The capability to detect weak signals, emerging trends, and discontinuities.
• Strategic agility: The ability to sense and respond to environmental changes rapidly while maintaining strategic direction.
• Strategic dialogue: Purposeful conversation aimed at exploring strategic issues and building shared understanding and commitment.
• Strategic metrics: Measures that track progress toward strategic objectives.
• Strategic mindset: A habitual way of thinking that includes long-term orientation, systems perspective, curiosity, and comfort with ambiguity.
• Strategic questions: Open-ended inquiries that challenge assumptions, broaden perspectives, and stimulate deeper thinking about direction and purpose.
• Strategic storytelling: The use of narrative to communicate a vision, build alignment, and inspire action toward a strategic goal.
• Strategic thinking: A mental process focused on envisioning future possibilities and making decisions that position an organization or individual for long-term success.
• SWOT analysis: A framework for identifying internal Strengths and Weaknesses and external Opportunities and Threats.
• Systems thinking: A discipline for understanding interrelationships and patterns rather than linear cause-effect chains.
• Tactical questions: Questions focused on immediate execution and operational details.
• Tactical thinking: Short-term, action-oriented thinking focused on immediate tasks and efficiency.
• Target: The desired level of performance for a metric.
• Three Horizons framework: A model for thinking about innovation across different time horizons.
• Value innovation: The simultaneous pursuit of differentiation and low cost, creating value for both buyers and the company.
• Vanity metrics: Measures that look good but don't correlate with strategic success.
• Vision: A compelling image of a desired future state that guides and motivates action.
• Weak signals: Small, easily overlooked indicators of potential future change.
• World Café: A structured conversational process for engaging large groups in dialogue.

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