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Conventional wisdom says the best formula for business growth is to envision a “clear goal” for the future and to work to make that vision a reality. But the conventional wisdom is more likely a ticket to irrelevance. That’s because you’re doing business in an environment of constant and accelerating change. When the future arrives, your clear goal may no longer make sense. A more effective approach is to embrace change and uncertainty by launching “quests” in which you imagine many possible futures. When you determine which of these scenarios seem likely to occur, “augment” your strategy to adapt to them.
The Business Life Cycle
Start-up businesses are dynamic because they naturally expect and accept uncertainty. In the start-up phase, you pursue “hunches,” explore new pathways, learn from experience and adapt quickly. If things go well, your company grows.
“We cannot set forth a single, clear vision for the future while knowing that the future is infinitely complex and uncertain.”
Unfortunately, when things go well, start-up leaders become reluctant to tamper with success. As the leader of a growing company, you’re likely to focus on improving the efficiency of your winning formula – perhaps by automating certain functions and establishing improved systems and policies. A mature company may operate smoothly, but it can’t respond quickly to changing markets, technological breakthroughs or new competitors. That means it slides into irrelevance.
“The only context that matters for strategy now is the future context.”
When a company pursues efficiency as a strategy, its workforce adopts default thinking. This approach enhances efficiency because it offers ready-made solutions – templates, systems and procedures that spring from past experiences. Think about how you drive your car without putting conscious thought into every action – that’s default thinking. Being able to use a default, expected action is indispensable for the routine parts of your operation. Yet, default thinking can’t spur innovation or adaptation to changing conditions. For that, you must engage “thorough thinking.” This more thorough mode of thought doesn’t offer fast, predictable results, but it can begin the process of discovering new paths to growth. That process will take the form of a “quest.”
In the quests of myth and legend, heroic figures set forth – often reluctantly – from the everyday world, find wisdom in their travels and return to transform the default world.
“Training ourselves out of the need to jump to quick fixes, and to remain in the angst and tension of uncertainty, takes a while – but doing so almost always leads to better thinking.”
Questing business leaders set out to discover alternative paths to growth that branch out from the default path. They use these discoveries to forge strategies that prepare their business for the future. By stepping away from the expected default position, questing leaders reawaken their firm’s start-up spirit.
“By seeking to reduce uncertainty – instead of questing within it – we end up reducing the very things that allow us to pioneer and unlock game-changing strategic innovation: creativity, serendipity, imagination, diversity, experimentation and learning.”
The Quest Begins
Initiate your quest by imagining various alternative futures – different “contexts” in which to compete. You might picture a world in which companies deliver their products via 3D printers or, alternatively, one where people eschew physical items and prefer digital products they can store online. Do these scenarios suggest threats that your organization should prepare for? Do they hold opportunities you should exploit?
Try various techniques and practices for generating these contexts or scenarios:
“The default enterprise model has been built to instill order and resist change – but this is the very thing holding us back.”
- Listen to your hunches – A hunch is a feeling that the default consensus isn’t quite right. Perhaps you can find an alternative, more accurate explanation for the phenomena you observe. You may have formed your hunch by unconsciously noticing subtle signs of a shift in the market – a shift that is “incoherent” or inconsistent with your current strategy.
- Monitor trends – Keep up with technological and societal trends by following varied news sources. Consider using a news aggregator that collates relevant stories from diverse sources.
- “Reverse assumptions” – Take an idea that you have about the future – like the 3D printer scenario – and reverse this prediction. Assert that 3D printers will never catch on, and explain why they won’t and what that would mean to your business.
- Look for “friction” – Find the areas in people’s lives where things don’t go as smoothly as they’d like. These areas are ripe for disruption. Keep tabs on recent innovations that removed friction from people’s lives.
- Focus on the possible, not the probable – When you explore only those futures that appear probable, you conjure an illusion of certainty. Instead, aim to find unconventional possibilities – the options not everyone sees.
“It can be hard for folks to explore or accept new ideas that lack an established precedent.”
Once you have a collection of interesting possible contexts, perform experiments to identify “viable” strategic options. Devise a “declarative hypothesis,” a testable statement about an option based on the limited evidence you possess. For instance, Netflix was in the business of renting DVDs through the mail. It tested a strategic option for future growth via online streaming of movies. The company’s hypothesis: People will pay to watch movies online.
Devise an inexpensive, low-risk way to test your hypothesis. For instance, if you want to test the hypothesis that replacing internal company emails with a social media platform will boost productivity, try the new system in one small department for a limited time.
“At their worst, mature organizations have a bank of well-established policies and procedures that significantly hobble their ability to innovate or prosper.”
Your test will prove or disprove your hypothesis. But either result provides grist for learning and further exploration. Disproving your hypothesis is not failure; you are making progress because you learned that an option is not viable.
“Change, progress and growth only truly happen when we challenge our thinking, and explore alternative options.”
To create experiments with minimal downsides, keep your tests small-scale and low-risk. If your experiment proves the hypothesis, repeat it – perhaps with different subjects or variables – and try to duplicate the results.
Designing strategy in the face of projected future contexts is too crucial to leave to a brainstorming meeting or even an all-day strategy summit. Stage a “strategic immersion” of at least two days. Pull your colleagues out of their default thinking and away from their efficient busyness.
“This is exactly the quality we want in leaders – the ability to question ourselves, to think deeper and accept that no one and no thing is perfect, but we can learn.”
On the first day, describe the future context, show how the current strategy cannot prevail within the new context and outline ideas for modifying the strategy. Take care when you present strategic options. Give each option a catchy name and explain how it addresses the discord between the organization’s current strategy and the coming context. Offer an overview that shows how the option works in logical terms. Fill in the details, such as case studies you gathered from your news sources. At this point, appeal to your team’s emotions: Tell stories to show how your future option will affect the company and its customers in the real world.
“Savvy leaders in organizations are realizing that it’s possible to create start-ups within their existing enterprise.”
The team should make decisions on the second day, after your colleagues have had the opportunity to discuss the topics, formally and informally. Your main order of business is to choose whether to continue on your present course or adopt a new path. If you go with the new approach, begin augmenting your firm’s strategy to cohere with the new option. This can be a simple three-part process:
- “Stop” – Identify the parts of your business model that won’t be relevant in the new context. These could include partnerships or advertising strategies.
- “Start” – Identify actions you need to initiate.
- “Savvy-up” – Identify existing actions you need to continue, such as a strong customer service effort, and consider how you should improve them.
“Doubt is one of our most stalwart companions to any quest.”
Create a timeline that identifies strategic milestones to reach in 24 hours, a week, a month, the next quarter and the next year.
“Whenever we believe the world makes sense, it’s due to our profound ability to ignore our own ignorance.”
Integrate the augmented strategy within your company’s ongoing operations. Take a “bimodal” approach: Keep some parts of the company running on default modes as you establish new teams to institute your strategy. Give your teams autonomy, and protect them from the more conservative elements of your organization, which will try to pull them back into default mode. Make sure everyone in the organization is in the loop. Have the team members issue reports on their work and encourage them to tap “key stakeholders” for advice and expertise.
Your overall strategy will have no finite goal aside from continued relevance, but it will include “missions” with specific, limited goals. Each mission should have a clearly defined end point, so it doesn’t take on a life of its own, eclipsing the larger purpose it serves.
“To find futures, we need to venture into the angst of uncertainty, and systematically and collectively use our imagination to explore what’s possible.”
Slay the Dragons
Any worthwhile quest has dangers. Watch for these pitfalls:
- Flagging morale – Keeping people enthused about a distant, uncertain future can be difficult. Instead, focus on showing your colleagues what comes next on the path and acknowledge each accomplishment on the way.
- Taking it personally – Cultivate a detached perspective on your work so you won’t interpret the inevitable missteps as personal failures. Promote this mind-set through such activities as keeping a journal on your progress.
- “Self-sabotage” – In stressful situations, you might unconsciously adopt behaviors that undermine your efforts while providing excuses for failures. For instance, “perfectionism” is a sabotaging behavior. You constantly revise your work, or you avoid taking action while you wait for the right conditions or information. When you fail to finish, you can say you didn’t have sufficient time to get the job done right.
- Going it alone – Work in a team instead of doing everything solo. Draw on other team members’ diverse perspectives. Team members can squelch self-sabotage as they keep each other motivated. The best size for a team is five to nine people.
Fostering a “Pioneering Culture”
Imbue your organizational culture with a pioneering spirit to protect your workforce against default thinking and an overemphasis on efficiency. Identify a few behaviors crucial to the culture you envision and ensure that the company’s leaders become role models of those behaviors.
You affect your organization’s culture by designing “structures” – such as the office’s physical layout – and “artifacts,” such as employee handbooks. However, “rituals” prove to be even more effective tools. Rituals are activities that reconnect your actions to your intentions and that acknowledge your progress. Rituals pull your colleagues away from the snares of default thinking by placing their activities within the context of the quest for future agility. Use rituals to clarify three aspects of that quest:
- “Why” – These rituals reinforce your enterprise’s big picture: why you do what you do. Helpful annual rituals could include strategic immersion, a company conference or a “future mapping” session.
- “What” – Meet periodically to review your catalog of options and your strategy. This keeps your quest framework fresh and relevant as conditions evolve. Attend one or more outside “learning events,” such as a seminar, a networking meeting or a lecture. Go as a team or attend alone and share what you learned.
- “How” – Use personal daily or weekly rituals to focus on your individual activities and duties. To break away from default thinking, choose activities that promote meaningful progress. Instead of beginning your morning by automatically checking email, which will provoke you to react to external triggers, start by identifying three proactive moves you can make that day.