Three Tests Every Strategic Theme Must Pass

Most strategies list priorities. The firms that dominate their industries organise around something more specific.

Every strategy results in a list of priorities. Digital transformation. Customer centricity. Operational excellence. Sustainability. Innovation. These words appear in strategies across every industry, and most of them are doing no strategic work at all.

These priorities are not wrong. Many reflect genuine concerns. The problem is that they are interchangeable. Swap the priorities of any two firms in the same industry and you would struggle to tell the difference. When everything is a priority, nothing organises the firm’s decisions in a distinctive direction.

A theme is different from a priority. It is a long-term structural force, external to the firm, that the firm has chosen to organise its strategy around.

Themes exist whether the firm responds to them or not. E-commerce was rewriting the rules of distribution whether any individual retailer invested in it or not. The shift to renewable energy was reshaping power markets whether any individual utility adapted or not. The choice to organise around a theme is a strategic decision. The theme itself is external and indifferent to your participation.

My research across 8,430 companies found that the firms which dominated their industries selected three or four themes and committed to them over decades. The precision of that selection is what made the approach work. Too many themes leads to diffusion, the same problem conventional strategy produces when it tries to respond to everything. Too few creates vulnerability. The question is how to separate the small number of themes worth organising around from the hundreds of forces in any firm’s external environment.

I use three tests. A candidate force must pass all three to qualify.

Test 1: Structural shift

Has the force been growing for ten or more years, at a rate significantly greater than GDP growth, across economic cycles?

Cloud computing clears this bar easily. It has been growing consistently since the mid-2000s, through recessions and recoveries, and shows no signs of decelerating. The metaverse, as conceived in 2021, does not. It generated intense media attention for roughly two years, attracted large corporate investments, and then failed to achieve mass adoption. The distinction matters because organisations frequently confuse excitement with structure. A force that generates conference panels and consulting reports is not necessarily one that has been growing consistently for a decade. The test is deliberately backward-looking. It asks not “will this be important?” but “has this already been important, for a long time, across conditions that would have killed it if it were not structural?”

A sophisticated objection to the ten-year threshold is that it would exclude genuinely structural forces in their early stages. This is a fair concern, and the answer is that the test is a heuristic for structural durability, not a rigid threshold. A force that has been growing for seven years with accelerating momentum may qualify. One that has been growing for two years with intense media coverage but no evidence of persistence across an economic downturn probably does not.

AI is worth addressing directly because it illustrates this judgment in practice. Large language models appeared to arrive suddenly in late 2022. But the underlying compute infrastructure, the training data pipelines, and the venture investment in AI companies had been building for well over a decade. The structural force underneath was not sudden. The product that made it visible was. What looked like a disruption was actually the visible surface of a shift that had been compounding for years. AI qualifies under this test, but the full argument for why most firms’ AI strategies still fail as themes belongs to the third test below.

Test 2: Cross-industry relevance

Why does a theme need to affect more than one industry? Because a force that reshapes a single niche cannot anchor a firm’s strategy for a decade. The breadth of a force determines how many strategic options it creates and how many applications the firm can find across its portfolio, its geographies, and its growth trajectory. A narrow force produces a product opportunity. A broad force produces a strategic position.

Ageing populations are the clearest example of a force that meets this standard. The implications reach into healthcare through rising chronic disease treatment and growing eldercare demand, into financial services through longer retirements requiring different savings and pension products, and into housing through demand for smaller units, single-floor living, and proximity to medical services. Consumer goods firms face different nutritional needs and packaging requirements. Labour markets face shrinking working-age populations and rising dependency ratios. A firm that organises around ageing populations can find applications across its entire portfolio and across multiple geographies, since the demographic trajectory is seen in nearly all developed economies.

Contrast this with blockchain-based supply chain verification. It may be growing. It may solve a real problem in specific logistics and procurement contexts. But its applications are concentrated in a narrow band of use cases within a single domain. No CEO would stand in front of a board and say “Our strategy for the next decade is organised around blockchain-based supply chain verification.” The number of industries a force affects is a reasonable proxy for how much strategic surface area it creates. A force that touches six industries gives a firm six different ways to apply its theme and six different sources of compounding advantage as the force accelerates.

Precision fermentation is transforming parts of the food industry, but it has limited relevance to financial services, healthcare, or media. A firm operating solely within food production might reasonably organise around it. A diversified firm cannot.

Test 3: Actionability

This is where most candidate themes are eliminated. A firm must be able to explicitly allocate capital and talent to the theme. If it cannot point to specific investments, specific hires, and specific decisions that flow directly from the theme, the theme has not passed.

“The world is becoming more uncertain” is an observation that most leaders would agree with. But no firm can allocate a budget line to uncertainty. There is no R&D programme for “uncertainty.” There is no acquisition target called “uncertainty.” The observation is real but not actionable, which means it cannot be a theme. “The future of work is changing” is a similar case. It sounds strategic. It appears in annual reports across industries. But what capital decision does it produce? Which specific capabilities does the firm build? Unless the leadership team can answer those questions concretely, the phrase is occupying strategic space without doing strategic work.

This is where most firms’ AI strategies fail, and the failure is instructive because it shows what the actionability test is actually filtering for. AI satisfies the structural shift and cross-industry tests easily. The problem is how firms articulate it. “Artificial intelligence is transforming our industry” is a statement that could appear in any strategy in any sector and commit the firm to nothing. It is the strategic equivalent of “we believe in growth.” The actionability test requires specificity: which AI capabilities is the firm investing in? Can it hire the people it needs? Can it identify acquisition targets? Can it point to a budget line that says “AI-aligned investment” and explain what that investment will produce?

“Artificial intelligence” fails the actionability test. But “machine learning applied to drug discovery” clears it, because a firm can hire computational biologists, invest in training data infrastructure, and acquire companies with relevant datasets. “Computer vision for automated quality control in manufacturing” clears it too, for different reasons: the capital expenditure is identifiable, the talent requirements are specific, and the ROI is measurable against current defect rates. The test forces precision, and precision is where vague strategic language becomes operational commitment. A leadership team that cannot convert its AI priority from a sentence in a strategy document into a capital allocation plan has not yet identified a theme. It has identified a topic.

The filter in practice

When Cisco’s John Chambers said “I always compete against market transitions, not competitors,” he was describing what it looks like when themes, rather than internal priorities, organise the strategy. The three tests are the mechanism for arriving at that position.

The test you can run today is simple. Take the priorities listed in your current strategy document and run each one through the three filters. Has it been growing structurally for a decade? Does it affect multiple industries beyond your own? Can you point to specific capital and talent decisions that flow directly from it? The priorities that survive all three are your themes. The ones that fail are initiatives, observations, or buzzwords occupying strategic real estate they have not earned. A theme can be concrete (electric vehicles) or abstract (the sustainability movement that Unilever organised its entire strategy around), but it must survive all three filters regardless.

These judgments are not always clean. Reasonable people on the same leadership team will disagree about whether a force has been growing “significantly greater than GDP” or whether it has genuine cross-industry relevance. That disagreement is part of the value. The three tests are designed to force a debate that most strategy processes skip: not what should we do, but which external forces are structural enough to build around for a decade.

Most leadership teams that run this exercise discover that their strategy contains one or two genuine themes buried under a longer list of internal priorities that feel strategic but are not connected to any external force. The firms that dominated their industries did the opposite: they placed external forces at the centre and organised everything else around them.

The three tests are the mechanism for making that shift.