Forget the Five-Year Plan: A Better Way to Build Strategy

Why agility and creativity now matter more than control

For much of the twentieth century, the five-year plan was the gold standard of strategic thinking.

Inspired by military doctrine, perfected by corporate planners, and codified by consultancies, the long-term strategic plan was seen as the ultimate tool for aligning resources, setting direction, and delivering results. It offered clarity, structure, and the illusion of control.

But in today’s volatile, uncertain, and fast-changing environment, the five-year plan is no longer a source of strength. It has become a liability.

As organizations struggle to adapt to rapid shifts in technology, customer behavior, and global shocks, one thing has become painfully clear: the old model of strategy—analyze, predict, plan, execute—is increasingly obsolete.

Leaders don’t need more precision in their plans. They need more agility in their process. They need to stop planning as if the world will stand still—and start strategizing as if it won’t.

The Problem with the Planning Paradigm

Traditional strategic planning rests on three core assumptions:

1. The future can be predicted with reasonable certainty
2. Data analysis will reveal a clear, optimal path
3. Once set, a plan should be followed with discipline

But each of these assumptions is now under pressure.

• The world is less predictable than ever Industry boundaries are blurring. Customer expectations shift overnight. Black swan events like pandemics or geopolitical crises derail even the best-laid forecasts.
• Data is abundant, but not always useful Organizations now drown in data—but struggle to translate it into insight, foresight, or decisive action.
• Rigid plans discourage adaptation Once plans are set—especially with budgets and KPIs attached—organizations become locked into a course of action. Deviating is seen as failure, even when new information suggests it's the smart move.

The result? Many companies become prisoners of their own process. They pursue efficiency over relevance. They refine yesterday’s strategy rather than explore tomorrow’s opportunities.

And they lose to competitors who are willing to think—and act—differently.

Strategy for a World That Won’t Sit Still

What’s needed now is not better planning, but better strategizing—a fundamentally different way of thinking about and doing strategy.

One that is:

• Fluid, not fixed
• Insight-driven, not prediction-dependent
• Iterative, not linear
• Inclusive, not top-down
• Opportunity-seeking, not efficiency-maximizing

This new approach trades the illusion of certainty for the power of learning. It replaces static documents with dynamic discovery. And it shifts the purpose of strategy from making perfect choices to making better ones, faster.

The Fallacy of the Five-Year Horizon

The five-year strategic plan persists largely because it feels comfortable. It offers a sense of stability. It signals competence to boards and shareholders. And it aligns well with budgeting cycles.

But in most industries today, five years is an eternity.

• The average tenure of a company in the S&P 500 has dropped from 33 years in 1964 to around 20 years today—and is forecast to shrink even further.
• Business model lifespans are shortening.
• Competitive advantages are more transient.
• Customers expect faster innovation, greater personalization, and seamless digital experiences.

Planning five years out often means committing to strategies that will be outdated in three—or even sooner.

The irony? Many companies spend months crafting five-year plans they rarely look at again. They miss opportunities not because they lacked insight, but because their systems were too slow to respond.

What the Best Strategists Do Differently

Leading organizations are moving beyond long-range planning and embracing what can be called adaptive strategy.

Here’s how it works in practice:

1. They Start with Discovery, Not Assumptions

Before defining where to play or how to win, adaptive strategists ask:

• What’s changing in our environment?
• What new customer needs are emerging?
• What orthodoxies need to be challenged?
• What aren’t we seeing?

They use tools like customer immersion, design thinking, scenario planning, and business model canvases to explore—not just analyze. Strategy begins with curiosity, not confirmation.

2. They Design for Learning, Not Control

Rather than locking in big bets, they test multiple paths.

They treat strategy like a portfolio of hypotheses:

• Which markets are worth entering?
• Which value propositions resonate?
• Which models scale?

Each hypothesis is tested through rapid experimentation. Insights are shared, assumptions challenged, and the portfolio evolves based on evidence—not just instinct or politics.

3. They Shorten the Feedback Loops

Instead of annual strategy reviews, adaptive firms embed strategy into regular rhythms:

• Quarterly retrospectives
• Monthly initiative reviews
• Real-time dashboards focused on learning metrics, not just lagging indicators

This allows for faster pivots, smarter bets, and tighter alignment with external change.

4. They Involve the Edges of the Organization

Traditional strategy is often developed by a few people at the top. But adaptive strategy taps into insights from the front lines—where real-time shifts in customer behavior, competitor moves, and emerging pain points are visible.

By empowering cross-functional teams and engaging diverse voices, these organizations unlock strategic intelligence that no central planning team could replicate.

Adaptive Strategy in Action

Several companies have moved decisively in this direction—with powerful results.

Spotify

Rather than relying on top-down planning, Spotify uses autonomous squads aligned around customer experiences. Strategy is shaped through constant iteration, data feedback, and localized experimentation—creating a more adaptive and customer-centric model.

Haier

The Chinese appliance giant dismantled traditional hierarchies and empowered micro-enterprises to pursue their own strategies within the broader organization. Each unit is responsible for discovering opportunities, creating value, and learning in real time—turning strategy into a living system.

Adobe

When Adobe shifted from licensed software to cloud-based subscriptions, it didn’t do so with a static plan. It created small teams to test pricing models, customer onboarding flows, and usage analytics—allowing strategy to evolve based on what worked, not just what was forecast.

A New Operating Model for Strategy

To replace the five-year plan with something better, leaders need to rethink not just the content of strategy, but the operating model that supports it.

Here’s what that looks like:

Traditional Planning → Adaptive Strategy

• Long-range forecasts → Continuous sensing and scenario work
• Annual planning cycle → Quarterly reviews and real-time pivots
• Single plan with fixed KPIs → Portfolios of experiments and options
• Top-down directives → Co-created strategy with distributed input
• Performance against plan → Learning velocity and strategic agility

How to Get Started

If your organization is still anchored in traditional planning, here are five steps to begin shifting toward an adaptive strategy approach:

1. Reframe the purpose of strategy

Stop treating strategy as a plan to be executed. Start viewing it as a system for making better decisions under uncertainty.

2. Build strategic discovery into your cadence

Create time and space for exploration—not just execution. Host strategy sprints, run discovery workshops, and set aside time for customer insight gathering.

3. Start small, test fast

Pilot new approaches in one business unit, market, or product line. Use low-cost experiments to gather insight, build confidence, and demonstrate impact.

4. Update your metrics

Track leading indicators of change, learning velocity, and portfolio health—not just lagging financial KPIs.

5. Lead the mindset shift

Executives must model a new relationship with uncertainty. That means being comfortable with ambiguity, open to experimentation, and willing to shift course when learning demands it.

The Payoff: A More Resilient, Responsive Organization

Adaptive strategy doesn’t mean abandoning long-term ambition. It means building the capability to pursue that ambition more intelligently.

It gives organizations:

• Greater strategic resilience—by making course corrections before it's too late
• Faster learning cycles—by treating uncertainty as a feature, not a flaw
• Stronger engagement—by involving people closest to the action
• Higher relevance—by responding to customers, markets, and technologies in real time

In the end, it delivers not just agility—but advantage.

Conclusion: Stop Forecasting the Future. Start Shaping It.

The five-year plan had its place in the industrial age. It made sense when change was slow, competition was known, and information was scarce.

But we no longer live in that world.

Today’s leaders need strategy systems that move at the speed of change. That learn as they go. That adapt without waiting for permission.

It’s time to stop forecasting the future as if we can predict it. It’s time to start shaping it—through curiosity, experimentation, and strategic creativity.

The five-year plan won’t get you there. But an adaptive strategy will.

If you'd like to learn more about my approach to strategy, join the Better Strategy School. For a limited time, you can get started for only $99.