Last week we discussed the difference between strategic thinking and strategic planning. We also used the example of Airb&b to frame the discussion about strategic thinking. This week, we expand on that post. Specifically, we direct our attention to four core activities leaders can exercise to develop strategic thinking.

Developing Strategic Thinking and Strategic Planning Skills, Part II.

Just as it is easy for executives to get lost in the details of operations and lose the strategic perspective of their organizations, it is also easy to get lost in the vast array of things organizations can do (or should do) to help leaders think and act strategically. In helping our clients develop those future leaders, we focus on four core activities.

  1. Strategic Awareness

Scanning the environment builds strategic awareness; it enables the leaders to understand the organization’s current state and find new opportunities. As simple as this may sound, this starts with an analysis of the organization’s strengths, weaknesses, opportunities, and threats. Many organizations take this exercise lightly and are caught by surprise, like the case of Kodak’s demise.[1] Here are some key questions. What is the organization doing that is better than everyone else? What are the patterns of social change, economics, technology, politics, and globalization telling us about the future? And how does the organization measure against that paradigm?

Another important skill in developing strategic awareness is systems thinking. This is the ability to understand relationships and dependencies. A small change in a relationship with strong dependency can drastically affect an entire system. One can appreciate this in organizations, especially where resources are shared. Not long ago, we worked with some city leaders understand dependencies as they grappled with the questions of how to provide services for citizens in the future. Think for example about the implications of self-driving cars, electrical vehicles, virtual mobility, and Artificial Intelligence. The visual exercise of diagramming dependencies and think through causes and effects helped team members understand the effects of limiting (or investing) resources at key nodes in time.

  1. Questioning

The old adage, “If you don’t ask, you’ll never know,” is key in strategic thinking and planning. Even if you “know,” you may be operating under old paradigms. Here’s an example. One organization I helped was keen on quality. One of the non-conformities technicians were getting related to not engaging the emergency brake on vehicles (safety). Does this make sense in an automatic transmission vehicle when it is turned off, parked, chalked, and the shift is in the “parking” setting? The assumption was that setting the emergency break made the vehicle safer on the flight-line. Upon review, we discovered the rule was set before automatic vehicles were invented. The rule was rescinded. The point is that leaders need to question old rules and assumptions, especially about how the organization operates, how the market works, what motivates the workforce, and even the failures of the past.

Closely related to questioning assumptions is questioning the status quo. We encourage organizations we help to use “What If” statements to open themselves to a world of possibilities. Research has shown that organizations tend to drift into problems because of self-enacted realities, and therefore begin to exponentially diminish their return on strategy.[2] One way to avoid that self-enacted reality is to look at large opportunities and ask “What if…,” followed by the formation of detailed scenarios of the present and the future. The team can then begin the problem-solving journey or trace the roadmap to its envisioned reality.

  1. Thinking Collectively

In an in-depth study of senior HR managers, many of those interviewed identified strategic thinking as an activity that excluded lower level employees.[3] The problem with that type of culture is that the organization does not employ all of its thinking power; great ideas and innovation go undiscovered. We’ve helped organizations break from this paradigm by building collaborative teams that are cross-functional, across the organization. These teams are assembled to look at enterprise-wide problems and led by senior members of the organization. In turn, the leader and the team-members share organizational knowledge and grow together, more cohesive. This exchanged knowledge is fed back into the organizational decision-making loop and knowledge systems, creating new knowledge, and its application, new expertise.

  1. Envisioning and Acting Strategically

Envisioning and acting strategically is the core of strategic planning and happens well once the items 1-3 (above) have taken place. Unfortunately, many times the previous work is done too lightly. Here, we stress that leaders must focus on envisioning and acting strategically, not do a mere exercise of gathering people to write a well-coordinated, grammatically correct plan. Envisioning is about creating the future and the leader’s work in negotiating that future with others, so it becomes shared by all. Then, strategic acting focuses on creating the balance between present and future by balancing priorities from clear strategic thinking, selecting strategic drivers, delivering results, and nearing the vision through unrelenting assessment of strategic measures. This requires both art and cognition.

Wrapping it up!

Strategic thinking and strategic planning are crucial skills for leaders. Unfortunately, they’re not innate in all leaders, and not every organization is adequately equipped to do it. This post (and last week’s post) just touched on the surface of this complex topic to highlight the challenges, inform you on the importance of this mission to you as a leader, and stir your thinking on your business journey. Our calling at LS|EG is to equip leaders with the ability to think strategically, so they can envision and act strategically. Need help? Start with the four points listed above. And of course, let us know how we can help you dive deeper in any of these areas!

Always Motivated, lugo

References and notes:

[1] Hughes, R. L., & Beatty, K. C. (2014). Becoming a strategic leader: Your role in your organization’s enduring success (2d ed.). San Francisco, CA: Jossey-Bass. 75.

[2] Thompson, J., & Cole, M. (1997). Strategic competency – the learning challenge. Journal of Workplace Learning, 9(5), 153.162.

[3] (2015). The (lost) art of war: How strategic thinking is being forgotten, and how to get it back. Strategic Direction, 31(11), 28.