Strategy is half-baked without innovation. It is necessary to distinguish strategic planning from strategy innovation. Organizations typically carry out strategic planning by studying past data and predicting the future. The mistake here is the assumption that the future would resemble the past.
Strategic planning aims to extend the existing value proposition. Strategy innovation creates new business models, is market centric and aims to find new value proposition. Hence strategic planning is predominantly analytical while strategic innovation is creative.
However, strategic innovation is incomplete in isolation and hence strategic planning cannot be ignored altogether. The two can perfectly co-exist; one tending to the current and the other building the future. Even in future, the learnings and best practices of the past can be implemented as strategic planning would prop up strategic innovation.
Given below is a table by Professor Robert Johnston, which summarizes the differences between the two approaches.
| Strategic Planning | Strategy Innovation |
| Analytical | Creative |
| Numbers-driven | Insights-driven |
| Company-centric | Market-centric |
| Logic/Linear | Heuristic/Iterative |
| Today to tomorrow | Tomorrow to today |
| Extend current values | Create new values |
| Fit the business model | Create a new business model |
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