Let’s start with some statistics: not tending the future has big consequences. According to author and researcher Richard Foster, 75 percent of the S&P 500 will be replaced by 2027.
In working with a C-level client this fall, I’m reminded that today’s hard-driving operational environment leaves precious little time for future building. I see firsthand the tension deep down that is created knowing that as a senior member of the team, it’s your job to set the rudder and sail the ship to new opportunities. Equally important, you do not want to take the firm into a swamp of distracting and opaque investments.
But, there’s this issue: You know the drill…up early, calls to Europe, office time to set the day’s agenda, then back-to-back meetings, followed by dinner with the family and a conference call with Asia. Weekends are spent editing that presentation on your smartphone while watching the kid’s soccer game to make sure you’re ready for next week’s operations discussion.
And then there it is, right in the middle of the calendar: the annual strategy meeting. Now you’ll be doing a version of the op’s plan on steroids (with a high level of confirmation bias).
In my work with leaders all over the world, this scenario plays out over and over again, resulting in portfolios of incremental innovation work, followed by the occasional M&A deal that Velcro’s on some growth. When your palette of choices is limited, the results are predictable, and you become victim to a vicious cycle of incrementalism that either keeps you stuck in modest growth or makes you the target of an acquisition.
So how do we break this cycle without putting on mind-numbing, multi-day “creative” offsites that have you seriously considering inflicting damage on yourself with a paper clip?
After more than 20 years helping firms identify and capture value, my advice is threefold:
- Get back to first principles
- Put your assets to work
- Put your future work on a clock
Get Back to First Principles
For the core enterprise, the vehicle of choice for growth is the project. We have talked before about how finding the exact right project at precisely the right time is key to not wasting precious time and resources. If you don’t do this well, it’s not if, but how much time and cash will be lost.
For a project to be the right one, it has to have at least these three attributes (In our workshops we go much deeper, but this is a great start).
- It must have a substantial head start based on the enterprise’s strengths. This means the firm must have an unfair advantage at the outset in pursuing this new area. This advantage can be insight, access or know how.
- It must have a scope that fits within the sponsoring entity. The leadership of the project must have the ability to do the pioneering work to set the agenda and work through the risks. If coordinated action is needed, the project needs to be elevated to the appropriate sponsor.
- It must have a business concept that is not only profitable, but makes sense to the economics of the firm. Much is written of firms that need to “disrupt” themselves, and truthfully, this is a red herring. Powerful leaders make a decision to serve their customers in a more powerful way – and for all of their stakeholders benefit.
Put your Assets to Work
You can think of this work as shifting your point of view from the inside of the firm out, to the outside in. One of the questions you might ask yourself, is what portion of your business would a new customer hire to perform a job or meet a need. For example, you might have a superb capability to enter a very fragmented market and create order and high levels of service (e.g. Red Hat Software).
A second example I had a direct role in, was a communications product project for the application of transportation infrastructure communications and control – think freeway signs, buses, etc. The firm had products and services for wide area communications, but when we did the customer insight work, we found we needed easier installations, longer useful distances, mobility and narrower coverage zones. Nothing “off the shelf” fit this need. By harnessing and regrouping resident technologies, in partnership with insight from a leading customer (which were combined in unanticipated ways), we were able to create a new line of business.
- Intelligence Gathering. At the outset of every new client relationship, the firm I’m working with tells me they don’t have the viewpoints needed to engage in a future-oriented discussion. The truth is, there is a tremendous amount of information resident in your firm, and what you are missing, are the cross-cutting snapshots, questions and resulting insights that provide the foundation of understanding where your future lies. Using a combination of one-on-one interviews and short workshops, we’re able to converge on “domains of interest.” What we mean by “domains,” is the combinations of customer application, culture and geography that lie outside the core business’ reach and are not initially visible to the firm.
- Leveraging the outside view. We then take this domain information and query external experts who live in spaces unfamiliar to your firm in a very specific way to provide short, insightful scenarios of the “future” of that domain. The key is to understand that these views will not be the “right ones,” but they will be relevant, specific and provocative.
- Build your own view. Lastly, and perhaps most importantly, we re-engage the organization in specific workshops to flesh out their view of the domain: both in the context of the outside view and based on their proprietary insight. This ensures the firm has its own unique view it is guiding its resources and efforts towards.
Put your Future Work On the Clock
There is a double standard in many firms when it comes to expectations for growth programs, with concepts in the “fuzzy front end” being given a pass when it comes to careful review and oversight. In his fantastic book, Creativity Inc., Ed Catmull describes the power of crisp peer reviews for highly creative teams. It turns out, perspiration is more important than the “perfect” idea, because as Ed states, “Early on, all of our movies suck.”
- Sharp timelines and crisp meetings. Strategy work needs to carry its weight and not consist of ethereal wandering. Generating these outcomes can be done with tools and techniques that provide clear next steps, outcomes and expectations the operations teams will actually want to be part of. In our work, we use crisp agendas, rapid drill-down tools borrowed from Lean Six Sigma, as well as good project management practices to bring focus and blow away uncertainty.
- Dedicated time is absolutely necessary. My recommendation for senior leaders is to make sure they are spending at least one week per quarter on driving the future. Setting this example for your team will make sure there is room for good internal thinking to come forward.
- Use your challenge function. One of the best parts of great operationally efficient firms is that you have a very well-developed set of tools for vetting and activating investments. You don’t need to suspend this to do great future-oriented work, but you do need to spend very solid tranches of resources to gain very specific answers that will remove risk. By using a “whole-brained” approach, you’ll be able to bring concepts forward faster and on budget.
It is vitally important to activate some projects on every strategy cycle. If you use the above tools, you will have a very good plan, and by activating it, you will be building organizational muscle for growth that will serve your firm very well indeed.
My work takes me all over the world to apply the Right Project, Right Team, Right Plan Framework to help firms make strong plans for growth. If you’d like to discuss doing a one-day diagnostic session with me on your particular project or program, please reach out to me at 847-651-1014 or send me an email.
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