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2015-04-08 05:19:02
Graham Kenny
April 7, 2015
Working with the top executives at a company I ll call Titan (which designs and
makes transit concrete mixers), I noticed that they were flat-out busy doing
everything except thinking about strategy. They were keeping a close watch on
factory operations, tracking production targets, handling problems with
staffing and equipment, and even getting involved in administrative tasks like
supplying quotes and checking that all the invoicing had been done. And that
set the pace for everyone else in the organization. Employees took few breaks.
Many of them worked 12-hour days.
The trouble is, all this hasn t improved performance. In fact, Titan isn t
doing very well financially, with customers slow to pay, creditors chasing
their money, the bank overdraft growing, and profits in decline. When I took a
look at its 13-page strategic plan, I could see why.
The company lacks focus. It has 15 strategies, none of which are actually
related to how it achieves a competitive advantage. Rather, they re a bunch of
activities that keep the company s managers very occupied, but to no clear end.
While I could see from their disposition that in their hearts they knew
something was wrong with their plan and their thinking, they were basically too
busy to reflect. This has effectively taken the company s destiny out of their
hands.
Even if your organization is successful, being too busy isn t a good thing,
because you can t sustain a frenzy of activity. But it s much worse if the
activities themselves don t cohere strategically and your company s performance
is suffering as a result.
So, what does it take to build an organization that s less busy and more
coherent? An outsider s perspective.
As insiders to our companies, when we look at what we do, we see only activity.
When we think improve, we naturally focus on the world we know (Procter &
Gamble CEO A.G. Lafley refers to this tendency as the gravitational pull from
the inside ). This leads to an operational mindset.
A strategic mindset is outside-in. Position yourself across the street, so to
speak, and focus your attention on your firm s competitiveness. Ask yourself
questions like: Why would I want to buy from them? and Why would I want to
work for them? When you look at your company this way, the world becomes one
of outcomes, not activity and it becomes much easier to establish a few key
performance criteria. Then you can ask yourself So what? to set priorities.
When s the best time to think about all this? Well, not at work, when you re
surrounded by all the hubbub you ve yet to control. The work environment is
designed to focus our attention on the tasks at hand. To become more strategic,
you have to escape this channelling of your thoughts. Try using a simple device
that leaders have relied on for eons: walking. The rhythmic effect of putting
one foot after another frees the brain from itself, allowing you to take a
helicopter view of what you do day-to-day. You can reflect on relationships
which ones are most important to your competitiveness and how well you re
managing them. From this vantage point, you can better see how to reengineer
your activities, saving both time and effort.
Had Titan s CEO taken a walk and reflected, he might have identified that the
company s real source of competitiveness lay with three things that customers
valued. First, it customized its products. While one of Titan s main
competitors supplied cheaper mixers, made in Malaysia, they were standardized.
Titan s mixers and other products were purpose-built, a considerable advantage
to the customers that Titan ought to be targeting. Second, Titan offered a
complete package not just the initial mixer sale, but a suite of follow-up
repairs and product servicing that rivals weren t providing. And third, Titan
could offer superior customer service steeped in years of industry, product,
and technical experience.
Sometimes these advantages can be right in front of us. But they remain
underdeveloped, or we fail to capitalize on them, because everyone is consumed
by tasks that don t support them.
Focusing a company requires thought. It won t happen if you don t make the
time.
Graham Kenny is the managing director of Strategic Factors, a Sydney,
Australia-based consultancy that specializes in strategic planning and
performance measurement. He is the author of Crack Strategy s Code (President
Press, 2013) and Strategic Performance Measurement (President Press, 2014).