The common view about strategy is that of setting the high objectives of an initiative or an organization. The strategy of an organization dictates the direction of all activities. Tactic, on the other hand, are the chosen types of activities needed to achieve the objectives – to implement the strategy.

This looks clear but let’s examine our understanding on a specific case, a "for profit" organization example. The main objective of that organization is, "To make money now as well as in the future". Accourding to the above definition this high objective is the strategy of the organization. Can we say that everything that is needed in order to achieve this objective could be considered as Tactic?

The answer must be "No" if we consider that strategy is suppose to set clear direction – just stating the highest objective is far from being enough. Its no wonder that what is commonly done is to call a strategy also some additional objectives that are deemed as prerequisites for the achievement of the highest objective. In our example, we consider as strategy also objectives such as: "High customer satisfaction"and "Being the low cost provider". These objectives are still too broad to constitute a well-devised strategy. Companies continue to better specify their strategy by devising more and more specific objectives, like: "Making quality Job One"; "Basing operations in third-world countries" etc.. These more specific objectives are considered as prerequisites for the attainment of the higher objectives.

What we now realize is that strategy is not just a statement or a collection of statements but it has a hierarchical structure. There are several levels of strategy connected by necessary conditions - objectives from a lower level are prerequisites for objectives in a higher level. We expect that higher objectives will be generic in type, while objectives from lower levels will tend to be more and more specific.

Yet, this approach raises a problem. Aren’t the more specific objectives what we are calling Tactics?

Tactics determine how we achieve the higher objectives. When we "dive" down the levels of strategy, eventually we will wonder where do we stop dealing with Strategy and start to devise the Tactics. Where do we draw the line that separates the Strategy from the Tactics?

Our intuition tells us that strategy and tactics are different entities, different in nature. That difference is real and should not be determined solely according to levels of detail.

Strategy, as we said, is setting the objective(s). In other words, the strategy sets the "What for?" Tactics, on the other hand, are supposed to tell us "How we are supposed to reach the objectives." In other words, tactics is answering the "How?". That is in-line with what we said at the beginning of the article, so where did we went astray? Where did we get the impression that the difference between Strategy and Tactic is only in the level it is defined, Strategy at the higher levels and Tactics at the lower ones?

The concept that strategy should be defined in the higher levels and tactics in the lower levels, does not stem from the definitions of Strategy and Tactic. As a matter of fact it is in contradiction with these definitions. Sticking to the definitions of Strategy as the answer for "What for?" and Tactic as the answer for "How?" reveals that strategy and tactics are defined at any level, no matter how detailed.

For any meaningful action - "a Tactic entity" - we should be able to ask "Why are we doing this? What is its purpose?" The answer to these questions are what we’ve defined as "the Strategy entity". That means that for any "Tactical entity" there must be a corresponding "Strategy entity".

Likewise, for any meaningful objective - "Strategy entity"- we should be able to answer, "How do we obtain this? What actions are needed in order to achieve it?" The answer to these questions are what we’ve defined as "Tactic entities". That means that for any "Strategy entity" there must be a corresponding "Tactic entity".

Conclusion: for any "Tactic entity" there is a corresponding "strategy entity" and visa versa.

We understand that for any given "strategy entity" there is a coresponding Tactic but can we have more then one "Tactic entity"?

When would one claim that several "Tactic entities" are needed in order to achieve a certain objective? When one action is not enough. Several actions are needed, each one of the actions (tactical entities) contributes a different, necessary ingredient for the attainment of the objective. Without all the ingredients, the strategic objective is not attained.

These "necessary ingredients" are actually the unique objectives attained by taking each one of the "Tactic entities". To conclude, The basis for a claim that several "Tactic entities" (T₁, T₂, T₃) are needed for the

attainment of a "Strategy entity S_X", is that taking each one of them achieves its’ own "Strategic entity" (S₁, S₂, S₃) which is necessary for the attainment of the higher strategy S_X.

This understanding of the relationship between any tactic and strategy yeilds the following rule:

For any "strategy entity" there is only one "Tactic entity", if there is more then one then they must be alternative to each other.

Following this rule it means that for "Strategy entity S_X" there is also its’ own "Tactic entity T_X", which describes the action needed to be taken in order to achieve Sx.

What is the relationship between Sx and S₁, S₂, S₃ ? S₁, S₂, S₃ are prerequisites for the attainment of Sx.

What is the relationship between Tx and T₁, T₂, T₃ ? T₁, T₂, T₃ are the details of Tx.

Time is not involved when we dive down a level because to perform T₁, T₂, T₃ (which are the details of Tx) is to perform Tx.

We also now understand the following:

The group S₁/ T₁ + S₂/ T₂ + S₃/ T₃ ,is sufficient for the attainment of step: S_x/ T_x

Each one of the Steps: S₁/ T₁ , S₂/ T₂ , S₃/ T_{3 ,} is necessary for the group to achieve step: S_x/ T_x .

In our diagram the dotted lines represent necessary connections, where the solid arrow represent sufficiency. Let each pair of boxes S_i/T_i be called a step. Several steps in a group at one level form the necessary steps sufficient to achieve a step at a higher level.

Whenever we go down one level in the S&T (Strategic and Tactic) tree, it means that we should specify the necessary steps (composed by Strategic and Tactic entities) that as a group are sufficient to attain the higher step.

Except for the highest level, we should always have more than one step in a group. If we have only one step in a group, we don’t detail the corresponding higher level, but rather write the same thing in different words.

Therefore, we have the following rule:

For any step, there is more then one corresponding step in a lower level.

In the diagram an example is illustrated:

Notice that there is no limitation on how many steps we can have in a group.

So far, a step in a S&T tree was said to be composed by a strategic entity (the objective) and a Tactic entity (The action). There are other components to be added to each step, all can be considered as explanations:

• The Parallel Assumption:

For each step we claim that the step’s tactic (the How) will achieve the step’s strategy. The claim can be challanged in different ways:

1. There is no need for an action to achieve the strategy.
2. It is not possible to take the action
3. There is another, better alternative
4. There is a need for an additional action.

The parralel assumption is the answer we give to these challanges. Therefore the parralel assumption can be a necessary assumption (reason 1) or a sufficiency assumption (reason 4) or niether (reasons 2 and3) depending on the situation.

It is possible to have several parralel assumptions.

Tips to come up with a meaningful parralel assumption:

1. Highlight what is currently missing that prevents the attainment of the strategy.
2. Explain why nothing else besides what is written in the Tactic entity is needed in order to achieve the Strategy entity.
3. Disqualify, less suitable, alternative tactics.
4. In case that the tactic can be challenged as a flying pig state that it is possible (the lower level details are supposed to substantiate your claim).

Example: The company XX is a not-for-profit subsidery operating under budget. An initiative is launched with the objective (strategy entity) of: "Closing the gap between what is needed and what is budgeted for the attainment of XX objectives." The chosen Tactic entity is: "Creating sufficient net income to close the gap between what is needed for the attainment of XX objectives and what is budgeted."

At first glance the tactic does not look much more than a wishfull repetition of the objective. Notice how much clarity is provided by the parralel assumptions:

1. Cutting cost will unevoidably jeopardize XX ability to attain ts objectives.
2. There is no possibility to increase the budget.
3. There is no possibility to cut (reduce) XX objectives.
4. It is possible to generate additional sufficient net income.

• The Necessary assumption:We said that a step is necessary to achieve its corresponding higher step. The necessary assumption must be explicite. It explains why the given step is necessary (as part of the group) to achieve the higher step. It is possible to have several necessary assumptions. Tip:  To come up with a meaningful necessary assumption: Think of someone who will claim that this step is not necessary. Write your reply as the necessary assumption. That will explain why it is necessary, why this step is significant.

• The sufficient assumption: For each group of steps we claim that the group is sufficient to achieve the corresponding higher step. The assumption that substantiates this claim must be explicite. The sufficient assumption explains why all the steps of the corresponding lower level group, are sufficient to attain this step.

It is possible to have several sufficiency assumptions.

Tips to come up with a meaningful sufficincy assumption

In the S&T tree we write only strategic entities that are:

1. 1. Necessary (for the group to be sufficient).

   2. An action must be taken in order to achieve them.

Therefore,

1. 1. Disqualify what someone may think is a necessary condition.

   2. Point out that a certain necessary condition already exists,

and no action needs to be taken in order to achieve it.

Intermediate summury

The S&T tree looks like the following diagram:

:

• How do we consider alternatives?

Alternatives should not be found where there is a necessary connection (otherwise it would not be necessary), they can only exist when there is a sufficiency connection. Thus, there are only two places where alternatives could be found:

Within a step, in the connection between the "Tactic entity" and the "Strategic entity". In this case, the alternative means that for the given Strategy there is another alternative Tactic.

Between levels, in the connection between a lower level group and its corresponding higher level step. In this case, the alternative means that there is another group of steps in the lower level, that could be sufficient for the attainment of the higher level step.

• How do we decide if a certain step is part of the group. A certain step is part of the group if and only if it is necessary on its own merit for the attainment of the appropriate higher level step. It should not be there just as a means for achieving the other steps in the group (in this case it belongs to a lower level group).
• Numbering. The complete S&T tree will have many steps. If we want to be able to keep track of things we must be able to number each step in a way that will point out where it is located in the tree. To identify the location of a step in the tree we need to specify which step it is in which group of which level. Therefore, each step will be identified by a set of three numbers.
• Multiple parents. It is possible to kill two birds with one stone. In other words, it is possible that a step will participate in achieving two different higher steps, or that a group of steps will achieve two different higher level steps. In this article we’ll no elaborate on it.
• Supporting steps. There are steps that we would like to take not because they are absolutely necessary for the attainment of a higher step, but because they will contribute to the probability (or magnitute) of achieving the higher step. Again, in this article we’ll not allaborate on the specific mechanism to deal with such supporting steps.
• Time dependency. This is a very involved subject. At this stage, you don’t want to dive into it.

Constructing the S&T tree

General Advice 1: The easiest way to go upwards, from a a lower step into a (yet not writen) higher level, is to concentrate on the Strategy entity (of the lower step) and ask, "Why do I want to accomplish this objective? I must accomplish this objective in order to… ." Compliting the answer will provide the Strategy of the higher level.

General Advice 2: The easiest way to dive into a (yet not writen) lower level is to concentrate on the Tactic entity of the higher level and ask, "How exactly should this action be performed?" The answer will provide the Tactics of the lower group.

Start to build your S&T tree

Using the above advice it is clear that conceptually one can start to write a tree from any step at any level. Still, it is recommended to start by verbalizing a high level objective (Strategy entity). It doesn’t have to be the highest one, but it should be among the higher levels.

In order to come up with a starting high level objective, ask:

• What is the purpose of the subject/system in question?
• What is the reason for its existence/establishment?

If you come up with more then one objective (and none of them could be considered as just a means for the other) then you should put them as two (or more) Strategic entities of two distinct steps (probably of the same group).

Completing the step

You need to verbalize the "Tactic entity" for the given "Strategic entity".

Ask: What is the action that satisfies this objective?

Make sure the action you write is sufficient for the attainment of the "Strategic entity".

Verbalize the parallel assumption, which explains why did you choose the "Tactic entity" you’ve written for the attainment of the "Strategic entity".

In order to come up with a meaningful parralel assumption(s) it is possible to:

Either explain why nothing else besides what is written in the Tactic entity is needed in order to achieve the strategy entity and/or disqualify less suitable alternative tactics and/or ensuring that it is possible to perform the tactic.

 Diving down

To dive down, go down a level through the Tactic entity - Ask:

• What actions should be taken in order to achieve this Tactic?
• How do we take this action?

You must come up with more than one action. Any action that is necessary on it’s own merit (and not just as means for the other actions) should be written as a "Tactic entity" of one of the steps in the lower level group.

Verbalize the "Strategic entity" associated with each given "Tactic entity". Ask: What is the specific objective attained by taking this tactic action?"

Make sure the action is sufficient for the attainment of the "Strategic entity" you wrote. If it is not sufficient take that as a clear indication that you verbalized a too high of an objective. Try to be more specific in your strategic entity.

Complete the verbalization of the parallel assumption in each one of the steps in the group.

Completing the connection between the levels

• Verbalize the necessary assumptions of each step.

Examine the Strategy entity and answer the following questions:

"Why is achieving this objective necessary for achieving the higher step?"

"Why if this objective does not exist that the rest of the group will not be sufficient to achieve the higher step?"

Think of someone who will claim that this step is not necessary.

Write your reply as the necessary assumption.

Go back to the appropriate higher step and verbalize the "Sufficient assumption". In order to come up with a meaningful sufficiency assumption it is possible to disqualify (or reject) what someone else thinks is a necessary condition.

 And/or point out that the necessary condition is already sutisfied and no additional action need be taken in order to achieve it.

Follow the process until you reach a level which subjectively seems to you detailed enough. Most probably your boss will be under the impression that you’ve dived too deep (having too much detail) and your subordinates will have the impression that you haven’t dived deep enough (didn't provide enough detail). If this happens, it is good. It is an indication that the S&T tool is the appropriate tool for deligation and empowerment.

Going up a level

You might have started with a step that is not the highest step. To complete the tree you’ll have to construct the higher levels. Going up a level is done "with a purpose in mind". In other words, you should examine the stragtegy entity of the step(s) and ask, "What is the objective of achieving it?" The answer will be the strategy entity of the higher level. When the higher step is completed make sure that the corresponding group at the lower level is sufficient for its attainment.

 How do we read a S&T tree?

When reading your tree to someone who didn’t write it with you it is recommended to adhear to the following process. Start at the top. when you dive a level:

1. Read all the Necessary assumptions of the different steps in the lower group.
2. Read (again) the Necessary assumption with it’s corresponding Strategic entities of each step.
3. Read the Sufficient assumption of the higher step.
4. Read (again) the Strategic entity with it’s corresponding Tactic entity and parralel assumption of each step.

 Copyright Eli Goldratt 2002 

(This document was released to Washington State University for EM 596 Contemporary Topics in Constraints Management. Eli asked me to post this document for the world to see. Enjoy! Dr Holt jholt@wsu.edu