You’ve Survived, Now What? (Part 2)

Continued from You've Survived, Now What? (Part 1) Visual Analysis to Enhance Insight

Insight occurs when there is the conscience recognition of relationships with or associations among objects, previously deemed unrelated, that help solve problems or provide new perspectives on problems. Sanders believes that the creation of visual images activates deeper levels of awareness which helps develop insight. Both Sanders and Canton recommend techniques for drawing on the qualities and capabilities of the creative right brain hemisphere. These techniques are very reminiscent of a mind map, a long-used technique for graphically displaying concepts and relationships. The use of these graphic techniques has several benefits. First, it provides a vehicle for getting many concepts, some complementary, some contradictory and some seemingly unrelated in the same visual space, which is difficult to do with numerical analysis. Secondly, it provides a vehicle for the identification and understanding of issues, and encourages participation by non-quantitative leaders and followers, whose contributions may be limited, or even excluded, from a more quantitative approach. Lastly, it provides a simple tool to engage all members of the organization into the process of understanding issues, obstacles and opportunities, and provides insight that might otherwise be missed.

From Forecast to Foresight

Forecasting is one result of strategic quantitative analysis. A forecast of the anticipated environment in which an organization will operate is based on analysis of existing conditions and trends, i.e., what is known. As previously discussed, forecasting a chaotic and ever changing future environment via extrapolation from current data, regardless of how sophisticated the forecasting tool, can produce seriously inaccurate results that can lead to faulty and even fatal organizational decisions. According to Sanders, foresight is the ability to see what concepts, trends and issues may be emerging today that may significantly impact the future. She believes that foresight helps leaders understand the dynamics of change in a larger context and, significantly, to recognize new conditions in development. Importantly, Sanders emphasizes that with foresight leaders have the ability to help create the future by influencing these newly developing conditions. This is where truly significant strategic opportunities arise, and where strategic disasters are avoided. To quote Sanders: “The present is the future in its most creative state.”

Scan to Develop Foresight

The type of visual mapping devises recommended by both Sanders and Canton also provides a vehicle to facilitate the development of foresight. The development of foresight has two basic requirements. The first is a comprehensive, whole-system scan of the environment in which each organization operates. In today’s complex global system, opportunities and threats can be introduced at any point and at any time. To neglect the whole-system perspective leaves leaders at risk of missing a significant, developing condition. The first step, therefore, is observing your organization’s issues from a global perspective and mapping the findings and observations, and then looking for heretofore unseen relationships.

The second requirement according to Sanders for developing foresight is searching for “perking” information. Perking information is new or emerging conditions that may be insignificant now, but could at some point have significant impact on some aspect of the global system, or at a minimum, the immediate environment of your organization. These are new conditions which may be taking shape below the surface of normal activity that only well developed insight or foresight can identify. Examples of perking information are the early imports of low-end Japanese cars in the mid-1970’s; the early foreclosures related to subprime mortgages in 2003; the creation of Napster; and the 1993 World Trade Center bombing. Recognition of these “perking” conditions would have provided a glimpse of the future.

Engage the Whole Team

Even the simplest and smallest organizations exist in a global, chaotic, complex and rapidly-changing environment. In larger organizations, growing complexity only increases the potential risk of not implementing strategic thinking. The magnitude of the risk of not implementing systems to develop strategic insight of the current environment and foresight of the future is evidenced by the failures of major organizations over the last couple of years. However, the task of developing insight and foresight cannot adequately be accomplished solely by leadership teams, regardless of their experience and education. Sanders recommends that engaging all leaders and followers for this purpose is essential. Those employees closest to the environment are those that can identify relationships with products, customers, vendors and other stakeholders to which leaders do not typically have access. Similarly, perking data may best be identified by those in the business environment that will experience changing conditions in the earliest stages. The engagement of all members of organizations will help leaders identify the future today.

Create the Future.

The leadership challenge in this chaotic, complex and rapidly changing world cannot be overstated. Classic tools have proven to be inadequate or of limited value in many cases. Successful leaders of tomorrow will elevate the strategic management process to include enhanced strategic thinking. This will include the development of insight and foresight through the use of visually enhanced thinking. It will also involve the participation of both right-brain creative and left-brain analytical leaders. Finally, all members of the organization must be included in the process, particularly those closest to the action to help identify critical “perking” information. Leaders that fail to engage in strategic thinking risk strategic failure; those that do will create their future.

Michael Petty is the managing partner of North Star Partners. North Star Partners assists companies in the areas of leadership development, strategic thought and application, and financial stewardship. He is also a doctoral candidate in the Strategic Leadership Program at Regent University, in Virginia Beach, VA, USA. Mike can be contacted at: mike.petty@north-star-partners.com

Fierce Foresight: Future Success Requires It

Even a casual observer of business has to wonder how certain products, or even established companies, can be successful over prolonged periods of time, seemingly firmly established in their markets and financially stable and then, all most without warning, become second class competitors, barely maintaining their existence. How does a company like Sony, which owned the portable music appliance market for over two decades with the legendary Walkman, miss the change in music recording technology? The Walkman was recently unceremoniously retired as its market share had been stolen in a few short years by the dynamic duo of iTunes and iPod. How does a company like General Motors go from respectable profitability to bankruptcy in six short months, primarily as a result of catastrophic events in another industry? Finally, as we watch, how does a company like Research in Motion fall from an almost cult-like status (remember the “crack-Berry”) to being on the proverbial ropes as a result of the change in customer use of cellular technology? A lack of foresight may have been the problem. More specifically, a lack of “fierce foresight.” In today’s competitive environment, characterized by many as chaotic, complex, conflict-ridden and rapidly changing, organizational leaders and their teams will need to acquire the ability to fiercely foresee change to avail themselves of emerging opportunities to create continually-evolving competitive advantage and, hence, maximize shareholder value, and/or to avoid value-destroying catastrophic failure. For most organizations, developing “fierce foresight” may be the only means of survival.

                                     The What of “Fierce Foresight”

It is best to address the skill of “fierce foresight” by defining these two terms. Webster’s Dictionary definitions of “fierce”, an adjective, include menacing, cruel, barbarous, and threatening. However, Roget’s Thesaurus provides the following synonyms: robust, intense, strong, powerful, passionate, unbridled, bold, and relentless.  The ability to conceive a vision of the future in which today’s organizations will have to compete will require a focus and dedication that exhibits many, if not all, of these traits. Not coincidentally leading into an unknown future will require these same traits.

“Foresight”, a noun, is defined in several ways by Webster: 1) care or provision for the future; 2) the act or power of foreseeing; 3) an act of looking forward; 4) knowledge or insight gained by looking forward; 5) and a view of the future.

Obviously, we are talking about the future, and the ability to look forward into the future. Thus, “fierce foresight” is the gaining of a view, or more appropriately alternate views, of the future by the robust, intense, passionate, bold, unbridled and relentless pursuit of insight by actively and aggressively looking forward. Peering into the uncertain, chaotic, complex and rapidly changing future, and leading an organization into that future, is not for the faint of heart.

                                     The Why of “Fierce Foresight”

With all the tools, analytics, models, theories and management concepts available to today’s leadership teams how do organizations, like those highlighted above, fail to see, or foresee, the catastrophic changes taking place in, and maybe more importantly outside of, their industries that can render their business models obsolete in such short periods of time that recovery may be nearly impossible. Based on thirty-plus years of experience involved in strategic planning as a corporate manager/executive and as an advisor to organizational leaders, I believe there are primarily three critical factors responsible for strategic near-sightedness. First and foremost, what many executives call “strategic” is not really strategic, but tactical. The planning period may be for more than one year, sometimes as many as five, but the orientation is still primarily about tactical competition in the existing market place and industry, utilizing primarily tactical analysis and tools.

Second, the strategic planning that does take place is based on analytical processes, not thoughtful development of insight or foresight.  Today’s managers are well educated in the application of the analytical models and tools at their disposal. However, organizational leaders and managers can be lulled into a false sense of confidence resulting from the “robust” results of analysis and simulation. However, in far too many cases this is just an extrapolation of today’s results and statistics into the future. Even the growing field of predictive analytics is still a sophisticated extrapolation of current data into an ever-changing future.

Third, a sense of strategic urgency is lacking. The organizational sense of urgency revolves around current performance; monthly, quarterly, annually; quickly followed by another round of the current performance merry-go-round. The urgency never progresses into the future. There are two primary reasons for this: the quarterly and annual performance orientation mandated by the financial markets, and the annual incentive compensation programs that predominantly reward current performance.  Even lucrative stock option awards, supposedly encouraging a longer-term view, are ineffective in promoting forward-looking activities primarily because the foundation of the value of such awards is the current performance of the organization, hence, the merry-go-round spins faster but not further out into the future.

                                    The How of “Fierce Foresight”

“Fierce Foresight” requires an intentionality to break from the tyranny of today’s operating demands of the organization and competitive demands of the market, and dedicate time and energy on understanding the dynamics and interrelationships of, not only the industry in which an organization competes, but the general environment that influences the industry and its participants. In addition, “fierce foresight” requires an intentionality to be sensitive and aware of the subtle, but potentially powerful, changes occurring not only in the organization’s market or industry but in the general environment. “Fierce foresight” also requires the engagement of all members of the organization, not just those responsible for “strategic planning.” Organizational members far removed from the C-suite may be closest to significant changing environmental conditions.  In addition, “fierce foresight” requires an evolution from fact-based “forecasting” to the creation of “insight of the present and foresight of the future” resulting from the intentionality discussed above. Lastly, “fierce foresight” will require the same urgency, if not more so, than that dedicated to current operations.

                                   Leading into an Uncertain Future

Leading into an uncertain future will require fierce leadership. Fierce leadership will require an all-hands commitment to knowing the future. Leaders need to challenge themselves and their organizations with respect to “why” strategic foresight is not a significant mindset of the organization, and commit to the development of the “how” of strategic foresight. The failure to remove the obstacles to “fierce foresight” will demand a high price. Peering into the uncertain, chaotic, complex and rapidly changing future, and leading an organization into that future, will require fierce leadership.  The heads-down, shoulder to the grindstone, current performance at all cost approach without an equally dedicated intentionality to developing foresight of the future will only guarantee a seat on the bench next to the Walkman, Blackberry and throng of former automotive executives.

Michael Petty is the Convene Chair in the Washington, DC area and managing partner of North Star Partners. North Star Partners assists companies in the areas of leadership development, strategic thought and action, and financial stewardship. Mike holds Bachelor and MBA degrees from Michigan State University and a Doctorate in the Strategic Leadership from Regent University.