I think that the three elements (Diagnosis, Choosing and Planning) will happen when we work with opportunity as well.

The difference is:

The way we work on the Diagnosis phase is different when dealing with problems and opportunities.

The diagnosis for problems is focused on identifying the root causes, the impact, risk, frequency, etc.

The diagnosis for opportunities, by the other side, is focused on identifying gaps, needs unmet (or poorly met), timing, etc.

So, to add to your point:

I agree! We can (and should) innovate when we're trying to think strategically.

But that's the Planning phase job — not Diagnosis. (Innovation is a challenge too, right?)

So, I don't think “innovation” is a key component — simply for one thing:

We don't innovate when we're trying to identify what to do. We innovate when we do.

Makes sense?