Category Archives: Strategy

Halt, Where Are You Going?

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“I want to take an inventory of my strengths and weaknesses,” said Olivia, somewhat excited.

“What for?” I asked.

“I think it’s important for us all to be more self-aware,” she replied.

“Why?” I pressed.

“I’m sorry, I thought you would support my interest in some self-reflection.”

“Self-reflection is fine, it’s a worthy pursuit, but for the purpose of what? Let’s say you take a complete inventory, a strength here, a weakness there. And, your observations are absolutely accurate. So what? What have you really accomplished?”

“Well, I would be more self-aware,” Olivia was a bit exasperated.

“Compared to what? A strength here, a weakness there, compared to what? Your inventory is just an inventory. I want to know where you want to go. What does life look like, feel like, taste like in your imagination of the future? What is your next destination on your journey? What is its color? Who is with you? What it your purpose in traveling there?

“When you get clarity in your vision and purpose, then self-reflection will be helpful. Understanding your strengths that will power your journey, facing your faults that might stop your journey, that’s the real value of self-awareness. Before you take an inventory, tell me where you are going.”

Event Driven

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“I think I second-guess myself when I think about what will take our company from here to there, to the next level, so to say,” Kylie wondered out loud.

“How so?” I asked.

“I just know, that I come to work each day, thinking about what I want to accomplish. But, before I get to my desk, someone ambushes me with an unexpected problem that has to be solved. It is difficult to focus on something extraordinary in the midst of derailment. Not that I can’t get us back on track, but then there is another something that happens.”

“And, so you feel like your life, your organization is driven by a series of unexpected events?” I pressed.

“You are right. Life would be much better if we could anticipate and predict, even little things,” Kylie nodded.

I shook my head. “You think things would be better if you could predict the future, but even if you could, which you can’t, you would still feel the same way. As long as you are driven by a series of events, you will be frustrated. Only when you are driven by a purpose, will you sense movement, inch by inch. There will always be problems and events. First you have to find a purpose, a purpose that has you.”

What Holds You Hostage?

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“You can either work on the plan the Board expects, and will not object to, or you can think differently about a new destination that is more important,” I said.

“But, I operate at the pleasure of the Board,” Kylie objected. “They write my paycheck. They expect solid quarterly results. I cannot turn in a plan based on a whim.”

“Then, your thinking has to be more than a whim,” I prodded. “Until then, you are hostage to the normal, predictable expectations that makes your Board comfortable. And, when they are comfortable, you are comfortable, and nothing remarkable will be accomplished.”

“Thinking this way sounds dangerous, a bit risky. If I do what you suggest, the Board might reject my plan and me along with it.”

“Then, you will no longer be a hostage,” I nodded.

“I might also be without a job,” Kylie appeared nervous.

“Think about this question,” I countered. “What moves would you have to make to double the revenues in your company in the next 12 months?”

“That would be impossible,” Kylie pushed back.

“Maybe, maybe not. The point is not to double your revenue, but to examine the moves you might make to do it. What might you explore?”

The Frame of the Plan

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“You set me on a path to think more clearly about the future in our planning,” Kylie informed me. “But what I am thinking, might not be finished in the timeframe of this plan.”

“Extraordinary achievement is not the goal, which may be outside of the timeframe of your plan. Extraordinary achievement is a way of life. It is the journey toward the goal.”

“But my Board wants me to have a plan for next year, in fact, they want me to have a plan for next quarter,” Kylie was stumped.

“Yes, to achieve something extraordinary, your company has to be in a healthy state. Next quarter requires solid action. But, if all you ever think about is short term results, eventually your success will be short termed. If all you ever do is the minimum, pretty soon, your minimum becomes your maximum.”

New Patterns

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“A blank sheet doesn’t give me much guidance,” Kylie announced.

“Agreed,” I replied. “But if you are going to create unconventional results, you have to think differently. Creativity is all about the future. If we could be creative simply by thinking about the past, we would all be successful. But, we’re not. Only those who imagine the future will create it.”

“I am still stuck with a blank sheet,” Kylie repeated.

“You are very good at analysis. Think of all the elements that might impact your future, things like market trends, regulation, labor, technology. Think about where those are headed, what is their direction? What events might bend their path? Then what happens? Draw those trajectories onto the edge of your blank sheet. See where they intersect.”

“My blank sheet isn’t blank anymore,” Kylie smiled. “In fact, it is become cluttered with new patterns.”

The Measure of an Idea

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How do we measure ideas? Some ideas are novel, seemingly based on something without precedent. Some ideas are clever adaptations of old ideas. Some ideas like parity seem fair, while other ideas appear weighted to one side or the other. So we can argue and debate the worth or value of one idea against another.

But ideas have consequences and outcomes. How do we measure outcomes? This is often a far different discussion than the way we measure ideas.

Little Boxes All Look the Same

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Most companies read all the books and hire all the best consultants so they can pursue the path to be the best. When I visit the offices of most CEOS, they have the same books on the shelf, the same slogans on the wall. It looks like a desperate attempt to be be as good as everyone else.

Your company can’t be high performing AND be like everyone else. To be a high performing company, you have to be different. What are the important differences between high performing and everyone else? What are the important differences that matter?

Spend Time in Chaos

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One foot in order and one foot in chaos. It is important for a company to get good at something and be able to deliver that in an efficient manner. That’s order.

Simultaneously, a company must spend time improving its product or service, discovering a new product or service, finding a new market segment. That’s chaos.

A company cannot sock away all the fruits (profit) of its labor. Some of those fruits have to be reinvested in chaos. It seems counterintuitive, sometimes unproductive, often painful. But it must be done, because eventually, your market will demand it.

The Trend is Your Friend

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“But these regulations are designed to stifle business,” Rory complained. “The government rules that we play under are political initiatives designed to drive us under.”

“Then, what are you waiting for?” I asked.

“What do you mean?” Rory replied.

“Are you waiting for the next political election, hoping for a new regime that will return your operating climate back to the way it was?”

“That would be nice,” Rory’s face lit up.

“Nice is like hope,” I said. “Ain’t gonna happen. Even if you do win a political victory, the likelihood of a return to the good old days will not happen. Instead of fighting or waiting, figure out how to take advantage. The trend is your friend.”

First Look Outside

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From the Ask Tom mailbag-

Question:
Our company is preparing for our annual strategic planning session. Sometimes, it just seems like an exercise to increase our net sales by ten percent and our net profit by two percent. If that is all we are doing, why do we spend two days off-site?

Response:
Some companies think that to increase our net sales by ten percent, we just need to increase our sales team and their efforts by ten percent. Some companies think that to increase our net profit by two percent, we just need to become more efficient and cut waste by two percent. These may be worthy objectives, but we hardly need two days off-site to think like that.

Strategic planning requires that we look at those external circumstances that are constraining the defined objectives in front of us. Adding ten percent more sales people to the team will not increase sales if our market is no longer interested in our product or service. What has changed about our market? What has changed about our competitors? What has changed about our vendors?

Cutting waste by two percent does not inform us about the changes in technology that create efficiencies on the order of 10 percent or 20 percent. What has changed about technology surrounding our business model? What has changed about our external labor system that may require us to look harder at technology as a solution?

What headwinds are created by new regulations, financial regulations, safety regulations, environmental regulations? What is the financial climate for infusions of external cash, lines of credit, institutional debt, private equity?

Most of these questions are not about internal factors, but external systems that have an impact on the way we internally organize.