How to Think Strategically
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| What are the 5 skills of strategic thinking? |
Not long ago Grace, the CEO of a
mid-size firm on the east coast, told me that she needed to hire a less
expensive consulting group to work in another area of her company. Grace said that
budgetary considerations necessitated the switch to this “low cost provider.” I
asked her how the new consultant’s work would relate to the previous work and
the implementation of her strategic plan. She said she hadn’t really thought
about it “that way.” That’s when we discussed the difference between planning
strategy and thinking strategically.
Thinking strategically is not the same as merely thinking about strategy or reflecting on a strategic plan. A strategic plan is a document from a systematic, often yearly, process. Thinking strategically, on the other hand, is a way of thinking throughout the day. It is a mindset that helps implement the plan via better daily decisions. The five skills of thinking strategically are seen below (1).
The Five Skills of Thinking Strategically
I. Focus Intention
II. Use Peripheral Vision
III. See the System
IV. Connect in Time
V. Test Drive Solutions
I.
Focus Intention – What do we want to achieve? – Our
energy, attention, and time can be focused like a laser's beam or diffused like
a prism's spectrum. Intent-focused leaders are lasers. They act on what is most
important and refuse to be distracted by the scattered spectrum of daily
urgencies. These strategic thinkers strive to apply Peter Drucker’s mandate to
be both effective (do the right things) and efficient (do things right) in that
order. They also use the Pareto principle, better known as the 80/20 rule, to
focus their organization on the fundamental few. They seldom mistake activity
for accomplishment.
As a CEO, Grace is often pulled in
many directions by diverse stakeholders who have competing agendas. We have
worked together to identify and manage her strategic paradox (the tension she
feels to improve service and
constrain costs at the same time). She’s also choosing to be more focused by creating
a “NOT to do list.”
For example, Grace visits her regional
offices every quarter to review their progress. When I asked her how she stayed
open to regional influences and concerns as
she pursued her strategic plan, her eyes glazed over. I explained that a
healthy peripheral vision encourages leaders to keep their eyes wide open and pursue their top priorities at the
same time. (Yes, another paradox!) Therefore, she decided to decrease the
amount of time she spent reviewing her plan during her visits and increase the
time she invested listening to each region’s stakeholders (local staff, customers,
suppliers etc.).
III.
See the System – How does this
issue relate to our ecosystem? A systems perspective invites leaders to
think about the parts of the organization, the pattern of the parts, and the
relationship among the parts. It is a way of viewing issues as part of the
larger ecosystem. Unfortunately, many leaders think in silos instead of
systems. They walk around with blinders on, like the proverbial racehorse
focused only on their race. Strategic
thinkers, on the other hand, consider the relationships among the vertical
(e.g., corporate, division level, business unit, etc.) and horizontal (e.g.,
marketing, research and development, manufacturing, suppliers, etc.) elements
of the organization as they make decisions.
If Grace was thinking from a systems perspective
when she considered hiring a less expensive consultant group, she would have
thought about how her other initiatives would be affected by this new hire. Thinking
strategically is not about saying NO to silos, it’s about saying KNOW to silos.
It’s about knowing when to focus on your silo (your unit) and when to open your
silo doors to connect with others.
IV.
Connect in Time – How should our history influence our destiny? “If you’re
still here after Christmas, I’m going to climb up on that Coke box and hit
you...” The bank president, Steve, said that the lesson he learned from the
preacher who uttered those words 40 years earlier was not to quit when the
going got tough. So, Steve went back to college after Christmas, received his
diploma two years later, and went on to become a successful banking executive.
Steve now has the Coke box in his office. It’s his connection to the past.
Leaders, like Steve, know how to
connect in time. They do not live in the past, but they do use it to
communicate important values and principles via powerful metaphors, symbols,
and stories. To connect in time, strategic thinkers reflect on the past and
future. They consider how both should inform present decisions.
V.
Test Drive Solutions – How could we try this? The last skill of the strategic
thinker invites you to be hypothesis-driven. Unlike those who try to get it
perfect the first time, strategic thinkers conduct small experiments. They test
solutions by trying ideas, gathering data, conducting after action reviews, and
adjusting course. Those skilled in this approach are able to think both
creatively (like an entrepreneur) and
critically (like a data-driven analyst). They build a culture that cultivates
learning as a way of working.
For example, Hewlett-Packard applied
this experimental mindset years ago as it researched and developed the ink-jet
printer. Leaders at HP used this “rapid prototyping” to push innovations out
the door to be tested by users as fast as possible. Failure was not only an
option for the strategic thinkers at HP, failure was welcomed... if it was
fast, small, and learning oriented.
As Grace develops these five strategic
thinking skills, she’s realized that they have helped her make better decisions,
adapt her strategies, and achieve her goals. Do you use any of these skills?
How? Which ones should you develop to help lead your team? Let me know. I’d
love to hear from you.
Keep
stretching when you feel pulled,
Dave
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