A strategy is only necessary when dealing with a competitive dynamic external environment. Without the dynamic or competitive elements a plan, rather than a strategy, will usually suffice. Built into this understanding of strategy are three key strategic activities.

First there is an internal dimension where capabilities are developed. This dimension deals with fundamental uncertainty, almost always costs the most and paradoxically, requires the greatest flexibility from the most rigid elements of strategy — capabilities. The fundamental uncertainty is driven by the cost to acquire, time taken to introduce and the life span of capabilities fielded. […] Having a capability changes the external environment.

The second dimension of strategy is the integrating role that bridges the internal and external environments. […] This area typically deals with shorter time-frames, involves moderate to high levels of uncertainty and cost very little in and of itself. It is usually the most flexible and creative area of strategy. The time-frames can be from the relatively immediate crisis to those that emerge over years. This level derives a ‘yield’ from the prior capability investments made, in some cases, decades ago. The decisions at this level are constrained by oversights or shortfalls of capability-investment decisions made much earlier. Today’s internal capability-development investment decisions constrain tomorrow’s strategy.

The final level is what the US calls the ‘theatre strategic’ level. This is the best understood realm of strategy which can be costly, but deals with the shortest time-frames and has the least uncertainty. Essentially the strategist at this level, sometimes a [operational] person, knows what interest he pursues, where to pursue it, what resources are available and who he is competing with. All three levels of strategy are interdependent to get to this point of use.

Anton Kuruc for the Lowy Interpreter