Strategy Is Not a Plan: Managing a Portfolio of Bets Under Uncertainty

The plan fallacy

Most organisations treat strategy as a plan. A document is produced — often over months, involving extensive consultation and elaborate slide decks. It describes what the organisation will do, in what sequence, to achieve defined objectives. Once approved, the plan is “executed.” Progress is measured by adherence to the plan. Success means doing what the plan said. Failure means deviating from it.

This model has a fatal flaw: it assumes the future is knowable enough to plan for. That the competitive landscape, customer behaviour, technology trajectory, and regulatory environment will remain sufficiently stable that a plan crafted in Q1 will still be correct in Q4. In practice, this assumption is almost never true.

The result is that organisations spend enormous energy executing plans that are progressively less relevant to the reality they’re operating in. And the measurement system — designed to track plan adherence — actively discourages the adaptation that would make strategy effective.

Strategy as bets

We propose a different framing: strategy is not a plan. Strategy is a portfolio of bets under uncertainty.

Each strategic choice is a bet — a hypothesis about the future that the organisation is investing resources to test. Some bets will pay off. Some won’t. The quality of strategy lies not in the accuracy of any individual bet, but in how the portfolio is constructed, monitored, and adapted.

This isn’t semantic. It fundamentally changes what we measure, what we track, and what we do when things aren’t working.

The anatomy of a strategic bet

Every bet has five components:

Thesis — a falsifiable statement about what will happen if we invest in this direction. Not “grow digital revenue” but “if we invest $X in a direct-to-customer digital channel, we will capture Y% of revenue through that channel within Z months, because [specific reasoning].”

Assumptions — the conditions that must be true for the thesis to hold. Market conditions, customer behaviour, competitive response, internal capability, regulatory environment. Each assumption is a potential failure point.

Initiatives — the work being done to test and advance the thesis. These should have demonstrable causal links to the thesis, not just conceptual alignment.

Evidence — the signals accumulating that tell you whether the bet is working. Not just lagging indicators (revenue) but leading indicators (customer behaviour changes, market response, capability development).

Interference — the organisational patterns that are distorting, blocking, or attenuating the bet’s progress. This is where most strategic value is destroyed, and where almost nobody looks.

What changes when you adopt this frame

You measure differently

Instead of tracking plan adherence, you track evidence accumulation. For each bet: is evidence gathering that the thesis is correct? Are assumptions holding? Are interference patterns forming that could undermine the bet?

A bet with strong evidence and low interference is a bet to double down on. A bet with weak evidence and high interference needs diagnosis — is the bet wrong, or is the interference preventing it from being tested?

You adapt differently

Plans resist change because change means failure. Bets expect adaptation because uncertainty means some bets will need to be adjusted or terminated. Killing a bet isn’t failure — it’s portfolio management. Continuing to invest in a bet where the evidence says it’s wrong? That’s failure.

You communicate differently

Plans create an expectation of certainty that leaders then feel obligated to maintain. Bets create an expectation of learning that leaders can use to make better decisions. “This bet isn’t working and here’s what we’re learning” is a fundamentally different conversation from “we’re behind plan.”

The portfolio view

When strategy is a portfolio of bets, the strategic conversation changes from “are we executing the plan?” to:

• Which bets are gathering positive evidence?
• Which bets have assumptions that are no longer holding?
• Where are interference patterns forming that are distorting our bets?
• How is the portfolio balanced across time horizons and risk profiles?
• What new bets should we be considering based on what we’re learning?

This is harder than plan tracking. It requires more nuanced measurement, more honest conversation, and more willingness to adapt. But it’s also the only model that works when the future is uncertain — which is to say, always.

The execution question

The bets framing doesn’t eliminate the execution challenge — it clarifies it. The question isn’t “are teams following the plan?” It’s “do teams understand the bet they’re serving, and is their work generating evidence for or against the thesis?”

This is where the translation problem becomes critical. If strategic bets are distorted as they cross organisational boundaries — if the thesis becomes vague, if the assumptions are unknown at the execution layer, if the evidence isn’t flowing back — then even a well-constructed portfolio of bets will fail.

Strategy as bets under uncertainty requires a visible translation layer. Without it, you’re making bets in the dark.