Episode Summary: Continuous Strategy Engineering—Beyond Waterfall Planning

Podcast: Scrum Master Toolbox Podcast: Agile storytelling from the trenches
Host: Vasco Duarte
Guests: Tom Gilb & Simon Holzapfel
Release Date: December 9, 2025
Series: Engineering Organizations for Impact (Episode 2)

Episode Overview

This episode dives deep into the limitations of traditional, waterfall-style strategic planning and explores the need for continuous strategy engineering in today's organizations. With expert guests Tom Gilb and Simon Holzapfel, host Vasco Duarte uncovers how organizations can shift from long, rigid strategies to adaptive, evidence-driven, and incrementally delivered strategy cycles. The discussion highlights practical approaches, including Tom Gilb’s "EVO" framework, the pitfalls of popular frameworks like OKRs at scale, and the critical role of organizational alignment using systems thinking.

Key Discussion Points and Insights

1. The Waterfall Legacy in Strategic Planning

• [02:18-02:56]
  Tom Gilb critiques the academic and professional inertia in strategic planning, arguing that most organizations still plan strategy like outdated waterfall projects.
  • Quote (Tom, 02:18):

    “The professors of strategy have no clue as to what EVO is. They are locked in decades ago Waterfall mode... They haven't undergone the agile conversion.”

  • Many leaders and professors still teach and apply sequential, big-batch strategy processes, missing out on the adaptability and learning central to Agile.

2. The EVO Approach to Continuous Strategy

• [03:43-06:24]
  Tom Gilb outlines his "EVO" (Evolutionary Value Optimization) approach:
  • Strategy Discovery:
    • Design is about identifying quantified goals ("North Star") and exploring diverse ways to achieve them.
    • Failure to clarify requirements leads to poor strategy design, which results in managing unsuccessful strategies.
  • Strategy Execution:
    • Instead of 3- or 5-year strategies, decompose plans into frequent, small increments—ideally weekly value delivery cycles.
    • Quote (Tom, 05:05):

      “Agile says no, you have to decompose this large strategy into a stream of smaller cycles of strategy delivery... I’ve been using once a week as a very good starting point.”

    • Tom emphasizes leveraging AI tools to break down large strategies into actionable weekly steps, removing barriers to incremental value delivery.
    • Quote (Tom, 06:24):

      "You can give anything big to your favorite AI and say decompose this into 52 weekly value delivery steps... you can no longer be in denial."

3. Contrasting EVO with OKRs and Vision-Led Strategy

• [06:44-09:20]
  Vasco and Tom compare EVO’s lean, quantified approach to the widespread use of Vision statements and Objectives & Key Results (OKRs):
  • OKRs are suitable for small-scale or personal productivity, but fail for large, complex systems due to oversimplification.
  • Quote (Tom, 07:19):

    “If you’re designing the air traffic control system for Europe... OKRs were never designed and never changed, so they were appropriate for that class of problem. They're just too simple.”

  • Effective strategy requires deeply quantified objectives and rigorous design, which most OKR implementations lack.
  • Tom references his paper "What is Wrong with OKRs?" and offers to share extensive resources for better strategic design.

4. Systems Thinking and Organizational Alignment

• [09:20-10:36]
  Simon Holzapfel brings in systems thinking, noting that organizations lack visible, two-way mechanisms (“information radiators”) for communicating and aligning strategy at all levels.
  • Quote (Simon, 10:04):

    "It's some sort of visible information radiator or maybe sprinkler... the Hoshin Kanri sprinkler system whereby the CEOs on the top make good use of Tom and his methods, it hits the sprinkler system, then comes out like a fine mist over everyone's desk—alignment. We don't have anything like that."

  • Refers to Hoshin Kanri (and "catch ball") for enabling ongoing, multidirectional strategy deployment.
  • Most leaders lack effective mental models for real organizational alignment, leading to failed strategy execution.

5. Making Strategy Practical and Testable

• [10:36-11:43]
  The episode previews tomorrow’s follow-up on testing strategies, not just testing software functionality—how to empirically test and adapt strategies as part of continuous improvement.

Notable Quotes & Memorable Moments

| Timestamp | Speaker | Quote | |-----------|---------|-------| | 02:18 | Tom Gilb | “Professors of strategy have no clue as to what EVO is. They are locked in decades ago Waterfall mode... They haven't undergone the agile conversion.” | | 05:05 | Tom Gilb | “Agile says no, you have to decompose this large strategy into a stream of smaller cycles of strategy delivery... I’ve been using once a week as a very good starting point.” | | 06:24 | Tom Gilb | "You can give anything big to your favorite AI and say decompose this into 52 weekly value delivery steps... you can no longer be in denial." | | 07:19 | Tom Gilb | “If you’re designing the air traffic control system for Europe... OKRs were never designed and never changed, so they were appropriate for that class of problem. They're just too simple.” | | 10:04 | Simon Holzapfel | "It's some sort of visible information radiator or maybe sprinkler... the Hoshin Kanri sprinkler system whereby the CEOs on the top make good use of Tom and his methods, it hits the sprinkler system, then comes out like a fine mist over everyone's desk—alignment. We don't have anything like that." |

Timestamps for Key Segments

• [01:11] – Introduction to the miniseries and guests
• [02:18] – Why traditional strategy remains waterfall (Tom’s critique)
• [03:43] – Overview of Tom Gilb’s EVO approach to strategy
• [06:44] – Comparing EVO to Vision/OKRs; OKR limitations
• [09:20] – Organizational and behavioral gaps in strategy execution (Simon)
• [10:36] – Explanation of Hoshin Kanri and alignment tools
• [11:07] – Mention of US practitioners and “catch ball” analogy
• [11:27] – Preview of next episode: Testing Strategies

Conclusion

This episode unpacks why organizations struggle with adaptive strategy, offering a compelling alternative in Tom Gilb’s EVO approach: break down strategy into clear, data-driven, rapidly iterated cycles. It critiques the misuse of OKRs at scale, underscores the lack of alignment mechanisms in organizations, and argues for systemic, two-way communication of strategy. The conversation primes listeners for a follow-up episode on empirically testing strategies—moving strategy from grand plans to tangible, measurable progress.