In a business environment characterized by radical uncertainty, it's hard to know where to focus let alone when to invest. Rita McGrath, a professor at Columbia Business School, has a framework that can help. She calls it "strategic centering."
McGrath outlines her ideas in a forthcoming Harvard Business Review article, "The Power of Strategic Centering," which will appear in the magazine's July-August 2026 issue.
"Leaders face more uncertainty than we've ever seen," she says. "There's no playbook. There's no 'new normal.' So leaders need to invent it."
McGrath argues that traditional approaches to strategy, including Michael Porter's influential "five forces" framework, are less effective in the current era. In the past, most corporate value derived from tangible things: factories, distribution networks, inventory. These days it resides mainly in intangible assets like software, data, brands, relationships, intellectual property, and organizational capabilities.
That calls for a new approach to strategy, and a new set of questions: What is your industry when digital technology erases the boundaries? What is your competitive advantage when intangible assets can be replicated or leapfrogged at digital speed? What is your planning horizon when technologies emerge, combine, and become obsolete in years rather than decades?
Strategic centering involves both process and mindset. It requires bringing people together to hash out "what are we really about" in the new environment. The aim is to deliberately choose an organizing principle — a mission, a customer segment, a technology, an ecosystem — that provides clarity and coherence to strategy when traditional anchors — defensible positions, stable industries, durable physical assets — are losing their power.
Done right, strategic centering can help leaders pursue a set of promising possibilities that share a common logic. It can help resolve capital-allocation dilemmas. And establishing a clear understanding of the organization's "center" can enable employees throughout the company to make decisions consistent with the strategic direction, without waiting for approval from above.
This isn't a moment for leaders to stand back and delegate authority. To lead a centered organization, executives need to be deeply engaged, highly visible, and intensely present. They need to be out on the front lines picking up weak signals. They need to provide direction without dictating methods. They need to make the center vivid, concrete, and present in daily decisions.
"Choosing a center," McGrath writes, "is the most important strategic decision a leader can make today."