Why Most CEOs Fail at Strategy — Before They Even Start

C-suites confuse performance with vision. Professor Elda Simonaska explains why reclaiming real strategy is the only path to future leadership.
 

Key Takeaways for the C-Suite

• Strategy demands trade-offs - not just growth targets.
• Disruption stems from difference, not efficiency.
• Benchmarking breeds sameness.
• Intuition matters more than data in uncertain environments.

• Leading means making creative bets - not following best practices. 

   

Most Firms Confuse Strategy With Goals

Despite their best intentions, many CEOs approach strategy the wrong way. 

They begin with numbers: "grow by 25%", "expand to five new markets", "increase customer retention". But as HEC strategy professor Elda Simonaska points out, these are not strategems. They're targets. 

Simonaska, who is also the Academic Director of the Executive Certificate "Strategy in the C-Suite", has studied how executives across industries articulate and act on strategy, combining real-world case studies, comparative data, and executive education insights. Her findings are unequivocal: without clear trade-offs and distinctiveness, there is no real strategy- just ambition. 

She warns that today's "strategy crisis" comes from this confusion. When firms focus on improving KPIs or matching competitors, they may get better - but also more alike. 

Sameness Is The Real Risk 

In highly developed markets, performance is no longer the key differentiator. Simonaska refers to this phenomenon as the "surplus society": a landscape in which firms offer similar products, hire similar people, and optimize similar processes. 

Competitors are closely benchmarked. Consultants emphasize best practices. Innovation becomes iterative, not generative. 

The consequence is a strategic flatline. Everyone is chasing the same metrics. Everyone is reading from the same playbook. And this is having worrying consequences on the perception of the purpose for company managers and workers. 

According to Harvard Business School research, 95% of executives don't clearly understand their company's strategy, and 71% of employees can't recognize it when tested. 

But strategy, Simonaska argues, is not about chasing sameness. It's about standing apart. And doing so requires trade-offs - choosing not to pursue what others do. 

Why Disruption Demands Difference

Improvement and disruption are not the same thing. Improvement means doing the same things better- faster delivery, sleeker interfaces, cheaper costs. Disruption, by contrast, means doing things different things entirely. 

Simonaska points out to companies that broke with industry norms to create real change: 

• Vinted, by appealing to consumers priced out of conventional retail.
• Corning, by rejecting high-tech complexity and choosing broad accessibility.
• Sony, by democratizing music for communities lacking infrastructure.
• Southwest, by defining their competition as trains and cars - not just other airlines. 

These firms didn't just outperform others on traditional metrics. They shifted the logic of competition. 
 

 The Trap of Delay 

Why do so many companies fail to act on disruption - even when they see it coming? 

Because they hesitate. They wait for validation. They postpone commitment? The threat is visible, but the response is delayed. 

Simonaska uses Nokia as a cautionary tale. Despite owning the patents and perceiving the iPhone threat, Nokia failed to act. Strategy requires conviction - not consensus. Netflix, on the other hand, offered its streaming platform to Blockbuster and proceeded boldly after being turned down. 

Strategic decisions, she insists, are not data-driven in the usual sense. They are bets. 

A compelling example is SpaceX, which redefined space exploration by betting on full reusability and rapid iteration. Unlike NASA's SLS system, which costs over $2 billion per launch and is non-reusable, SpaceX's Starship aims to reduce costs to $2-10 million per launch - with ten times the payload. These are not incremental gains. They represent a new strategic paradigm. 

Strategy Requires Bold, Early Commitment 

Simonaska's research emphasizes that strategy isn't about finding the "right answer". It's about selecting a path others may reject - and protecting it from short-term interference. In her executive courses at HEC, she encourages decision-makers to do what often feels uncomfortable: 

• Back a project that lacks immediate ROI
• Prioritize difference over consensus
• Protect experimentation from operation scrutiny
• Make a bet when logic says wait
• Hire for difference, not fit 

As she concludes, "If you don't cannibalize your business, someone else will". And, she believes, strategy isn't the pursuit of perfection - it's the courage to pursue the imperfect idea that no one else believes in yet.