The death of strategy (and what comes next)

A guide for businesses in the era of hyper-competition

The Gust, Willem van de Velde

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Two years ago, if I’m honest, nobody gave a shit about strategy.

There was a certain sub-breed of CEO who was curious enough and ambitious enough to take it seriously (some of whom I was lucky to have as clients). But in general, most were too busy making money to bother themselves with such navel-gazing nonsense.

You build a thing.
You hire people.
You sell.

Doesn’t exactly require a PhD, does it?

Well, two years is a long time.

Because in case you haven’t noticed, that money-making isn’t happening quite as easily as it used to. For most businesses, it feels like almost overnight the volume of competitors has risen, and the volume of customers has dropped. AI is creating the pressure to move at insane speed, even if it’s in no particular direction. And just keeping the lights on has suddenly become insanely expensive.

What’s particularly weird is that this is happening at all levels of business simultaneously.

We have this unprecedented situation where multi-billion dollar corporates are experiencing the same pressures as solo-operators. Economic, political, and technological factors are squeezing everyone at once — ushering in an entirely new business paradigm, one I’m calling:

Hyper-competition.

I’ve already started writing about elements of this concept here and here, and I’ll do a more comprehensive overview in a couple of weeks. However, for today’s purposes, we just need to accept the general idea that business is becoming harder in a somewhat vague, hard-to-define way — meaning we can then ask the follow-up question:

What do we do about it?

The tempting answer would be simply: “do strategy”. Actually think about your market, your competitors, your customers. Do your research. Work hard on positioning. Try to find the gaps. And do all of that other stuff that most businesses were too lazy or dumb to do before.

Unfortunately, however, I don’t think this will be enough.

As I explained before, just when we need this discipline, it’s lost a lot of its teeth because AI has made the basics too accessible. A 6/10 version of all this stuff is available at the click of a button. And so if we want to actually steal an advantage, we need to evolve to a higher version of strategy that stretches beyond what most of our competitors can do with a Claude subscription.

In this essay, I want to lay out my vision for this higher form of strategy — a form of strategy that is designed specifically to be the antidote to hyper-competition.

This is at the very edge of my thinking right now, so come with me while I think this through, via the concept of charismatic strategy.

Charismatic strategy

I first floated this idea in this piece here, but only with vague parameters around it, and so now I want to make it more concrete.

The broad idea here is very simple:

Charismatic strategy creates a direction for a business that will capture the attention and imagination of customers, talent, peers, and investors.

This is distinct from “un-charismatic strategy” (i.e. normal strategy), which is focused solely on where market opportunities lie, but doesn’t feel any particular pressure to “impress people” in its pursuit. Most good strategies are quite functional and boring, and are of limited interest to the company’s employees — let alone anyone external.

So why is this important?

And moreover, why is this an antidote to hyper-competition?

Well, the problem with normal strategy is that it assumes a couple of things that aren’t really true anymore.

1. It assumes that there is generally more demand than supply, and that decent market opportunities abound which you can find and exploit.

2. It assumes that when you settle on a direction and execute it, it will take competitors a while to adapt and catch up.

In the era of hyper-competition, neither of these things are true. Most markets are over-served, and the ability of competitors to adapt to each other’s offering is incredibly rapid and sophisticated. This is why you have heard some strategy-wonks saying (stupid) things like “strategy is dead — it’s now just about being hyper agile and reactive and changing all the time”.

Now whilst I think that is bad advice, it’s true that we do need to respond to this difficulty we have in finding and holding competitive advantage. And the answer, I believe, comes in exploiting the one “resource” that is still extremely scarce and slow-moving:

Human attention.

No matter how much technology proliferates, there remains a hard limit on how many things human beings can hold in their mental bandwidth at a given time. They can’t be aware of all the options at every moment. And what’s better still, because human beings are mimetic and want what each other want, once a company gets narrative “heat” behind it, it starts to gobble up attention at an exponential rate.

There are so many examples of this across all industries. I’m sure you can think of them in your own. Those businesses that become “the one people talk about”, “the one people want to work for”, “the one that attracts all the investment”. These are the charismatic businesses of any given industry, and they are extremely hard to dislodge because when that glamour sticks to you, it’s quite hard to rub off.

The other advantage of becoming the charismatic player is that most of your competitors won’t even bother to try. This isn’t default strategic advice, and most companies will think they don’t need to do it (or rather won’t even consider the possibility at all), which is precisely what makes it effective.

If you become the talked-about company — the one all the best people want to work for, that gathers earned-media attention in your industry, and which has an expansive brand story that translates well to marketing — then you have something of a moat.

Others can copy your offer, your tactics — but they can’t copy your reputation, because that’s not how human psychology works.

Does this make sense? Do you see why this would be a hedge against hyper-competition? If you have any questions, put them in the comments, but otherwise let’s move on to the next question:

How do we do this?