A lack of strategic thinking by the government is threatening the UK's national interest, MPs have said.
The cross-party public administration committee suggested a tendency for Whitehall to "muddle through".
It also said the Iraq and Afghanistan wars were examples where there had been a lack of over-arching strategy.
Foreign Secretary William Hague said the report showed a "chronic lack of strategic thinking in Britain's foreign and security policy" in recent years.
The committee's report also calls for the remit of the national security council and national security adviser Sir Peter Ricketts to be expanded, to include a central co-ordinating role on national strategy.
Its report also warned that the UK's capacity to think strategically had been undermined by assumptions that its national interests are best served by its relationship with the US and economic links within the European Union.
"Uncritical acceptance of these assumptions has led to a waning of our interests in, and ability to make, national strategy," said the committee.
"Recent events such as 9/11, climate change and the banking crisis are making us think differently about the world, but require us to find the means by which we can anticipate and understand these challenges and devise an appropriate response to them.
"If we now have a renewed need for national strategy, we have all but lost the capacity to think strategically. We have simply fallen out of the habit, and have lost the culture of strategy making."
Mr Hague said he welcomed the report, saying that the current government "came to office determined to put this right".
He added: "That is why we took immediate steps to begin to restore the finances of the Ministry of Defence and Foreign and Commonwealth Office to a sustainable footing.
"And that is why, as foreign secretary, I have made it a priority to reinforce the role of the Foreign and Commonwealth Office in driving foreign policy across the whole of government.
"Under this government there is a proper mechanism for the bringing together of strategic decisions about our security, defence, diplomacy and development, after years of ad-hoc thinking and poor decision- making."