I recently was looking through blogs from McKinsey Quarterly and ran across one of my favorites. It is entitled Bias busters: Premortems: Being Smart at the Start. The authors advocate the use of Premortems as a tool for identifying biases which can get in the way of good decision making. I agree as I use a similar process with clients who are developing strategies and transforming their organizations.

Reading the blog from McKinsey & Co. also brought back fond memories of a great man who originally taught me about Premortems. Marty Leaf was an accomplished lawyer in New York. He began his career as a trial lawyer and later expanded to handle dispute resolution as well as complex contract negotiations. Marty also provided a great service to humanitarian organizations such as the Buckminster Fuller Institute, Hunger Project and a United Nations NGO. Marty’s clients were typically large, well-known businesses, but also included a diverse group of individuals such as Lhamo Dondrub, the 14th Dalai Lama, John Denver and Werner Erhard.

I met Martin Leaf through a mutual friend, and then got to know him better as we sorted through some knotty corporate legal issues in New York. In addition to being excellent as an attorney and extremely bright and gracious, Marty was also fun to be around. As an example of his humor, when we were in a very tense moment sorting out this legal matter, I turned to Marty and had this exchange:

Me: “Marty, is it better to be dealing with a crook or a fool?”
Marty: “A crook.”
Me: “Why is that?”
Marty: “Because you can go have a nice meal with a crook since you know who you are dealing with, where it is much more difficult to deal with a fool!”

During this process Marty introduced me to his version of a Premortem. He said that at the completion of a trial, one of two things happen:

1. The winning side goes out to a fabulous restaurant to celebrate. During the meal the client toasts the legal team for their brilliance. After winning a big case, collecting the last of the fees is seldom an issue for the winning attorneys.
2. The losing side schleps back to the client’s offices, orders sandwiches, and immediately begins a postmortem to analyze what went wrong. Of course, the client’s opening presupposition is that the lawyers screwed up and lost the case. During the postmortem, however, new information often emerges which would have been helpful in the trial.

It was during one of these postmortems that it occurred to Marty that it would be a really good idea to have this conversation before they went to trial. Hence his use of the term Premortem. Marty graciously gave me permission to use the term, so I have for many years.

Marty’s view of a Premortem was designed to:

• Create strategic thinking from the future
• Discover information which existed in the company but was for some reason not being communicated upward
• Explore the blind spots and biases in the company’s thinking about the topic being litigated. It was easy for the legal team to be influenced by this mindset and not see the flaws in their client’s points of view

 

Create Strategic Thinking from the Future

Premortems are useful tools for vetting business strategies, designing a culture change and organizational transformation, as well as large capital projects. This value comes from creating a conversation regarding the future. One of the biggest challenges in helping executives develop strategies and plan for the execution of those strategies is confronting that the future is not knowable. Ironically for a trial lawyer this is easier, as the company either wins or loses the case. There are two clear and defined futures to consider.

In working with executives though, it is often more complicated since at the beginning they can think only from one place or future. Their thinking about the future is some form of a continuation of the past or present. Getting the executives to think from the future perspective, rather than just a continuation of the same from the past can be challenging since it is not knowable.

The future is not knowable because it has not happened yet. Since the future has not happened yet and is not knowable, it requires thinking strategically. That is, thinking without the comfort of analytical predictions which are based only on the past. Thinking strategically requires thinking from points in the future which are not necessarily a linear progression from the past. Given we naturally think from the past to today and project that forward, thinking from a future that is not necessarily like the past is a challenge. Hence, the value of being able to locate one’s thinking at a point in the future. In other words, providing a place to stand in the future in order to observe and think about big challenges to be faced in execution.

I find it useful to have executive teams think from two scenarios:

#1 Invented Future. Invented Future is created by executives to describe a future in which the intent of the organization is being fulfilled and stakeholders are thrilled. Conversations from the future rather than about the future provide a new and much improved perspective for strategic thinking. This Invented Future can be achieved through:

• Changes in mindsets
• Creativity and innovation
• Breakthroughs in how employees think about the business
• Improved listening to customers’ needs

 

#2 Failed Future. This provides opportunity for Premortem. This Premortem begins with a point in the future in which the strategies and execution plans have failed. Often there is a triggering event which led to the overall failure. These triggering events can include:

• Customers changing preferences for products and services
• Large customers being acquired or going out of business
• Digital disruption which radically reshapes the competitive landscape
• Global competitors entering a market with different financial drivers and product offerings

Discover “New” Information

A major risk to developing and executing strategies is critical information which is known by people in the organization but NOT communicated upward to decision makers in the organization. This dynamic can lead to catastrophic failures and safety issues. An excellent example of this is the case study of the events surrounding the deadly failure of NASA’s Columbia. In that case, managers who were responsible for safety were aware of issues which ultimately caused the disaster but chose not to communicate that information upward to those managing the mission.

Marty said that similar things happen in trials. During the trial the other side introduces facts or information which Marty and his team did not have. Often this new data was important to the outcomes. During the Postmortem, they discover that new facts and information existed within the client company but, for whatever reason, they were not communicated upward. The reasons for not disclosing this important information varied, but the consequences were still final.

A key question in conducting a Premortem is “What important data and information exists within our organization which we are currently not aware of but will be crucial in our strategic deliberations and execution?” I find that at first, there are blank looks on executive’s faces, but as we engage more people, we start to uncover very important information. This is among the reasons I recommend expanding the size of the group when planning execution of strategic projects.

Explore Biases, Blind Spots and Unproductive Mindsets

There is an abundance of evidence that cognitive biases are a major threat to strategic thinking. As an executive group begins to explore opportunities for growth, innovation and performance enhancement, it is useful to review some of the more common cognitive biases that could occur. If the group is candid, they will readily identify examples in which cognitive biases affected previous decisions. When a group can acknowledge the risks they face based on cognitive biases, it greatly expands its capability to think strategically. To illustrate the risks, I may ask the group to start with a future and then imagine how cognitive biases could negatively impact their conversations and deliberations.

I also use the term blind spots to encourage executives to explore dynamics in their thinking. Blind spots are often assumptions held by the group, but they have forgotten they are only assumptions. Challenging blind spots allows the group to uncover assumptions that need to be revisited and assessed. Among the most important set of assumptions to be revisited are those which involve external drivers that have huge impact on a company’s operations, as well as its customers. Examples include financial interest rates, number of housing starts, number of new autos built in a year, oil prices, number of active drilling rigs working on shore, etc.

Conclusion

Martin N. Leaf died in New York City after a long illness on May 23, 2015. At the time of his death he was surrounded by his family. The acknowledgements of the difference he made in people’s lives poured in. I loved one such acknowledgement which read,

“To Marty Leaf, a man for all seasons. You were a mighty influence in my life and the world”.

That sentiment expresses how many of us who knew Marty felt about him.

I hope this story about Marty has given you a new perspective about the use of Premortems. It is a simple, but highly effective tool in improving strategic thinking through identifying biases and blind spots.

By Larry G Hoelscher, Partner & Bob Chapman, PhD, Managing Partner of KingChapman

Leadership is the starting point for strategy, execution and transformation. Building a cadre or core of leaders is a critical success factor. Yet too often leadership is thought to be exercised only by executives and a few other chosen individuals. We say that is not only wrong, but it robs organizations of a most precious resource for executing strategic change and transformation. How then does this mistake keep occurring?

Where to Start?

The place to begin is by expanding one’s view of leadership beyond the narrow views that…

• Leadership is the “private reserve” of executives and senior managers
• Leadership is done by people in management and supervisory positions
• Leadership and management are the same thing

As we have worked with clients around the world for decades, we continue to hear some if not all of these assertions. A most common expression is that leadership is performed by executives or “those people on top”. When employees are asked “What are the things these executives do that show leadership”, we most often here “I don’t know”. In most challenging settings the “I don’t know” is often followed by “not much given the shape we are in”.

It is very common to hear that “our leaders are our managers and supervisors”. Again, when employees are asked what this means, the most common answers have to do with management roles performed by this individual. This includes:

• Forecasting
• Planning
• Organizing
• Commanding
• Coordinating
• Controlling

Each of these are important functions of management, yet this is not leadership.

Leadership is Different from Management

We have written a number of blogs and articles on the differences between management and leadership. For the purposes of this article, we would like to paraphrase John Kotter from one of his videos “The Key Differences Between Leading and Managing”:

“Management is fundamentally a set of processes, most core of which are planning, budgeting, organizing, staffing, controlling, and problem solving. Leadership is a set of processes involving creating a vision of the future and strategies to get there, communicating out to people in a way that gets them to buy in to the vision and strategies, creating an environment that motivates those people, and inspiring the people to want to make the vision a reality.”

By distinguishing between Management and Leadership, it becomes clear that Management occurs as a result of the business structure, and the people in management roles are designated to manage a group of people, functions, etc. It also becomes clear that leadership is not the result of any structure or function, or even of the level someone happens to be in on the organization chart. Instead, leadership can be seen by the inspired actions of others, and with this concept in mind, anyone can be doing their jobs and having a positive and inspiring impact on others around them – that is, being leaders.

Accepting the fundamental differences between Management and Leadership, we are making the following assertions:

• First – that anyone can be a leader
• Second – if employees are being leaders, they have a greater sense of commitment to delivering the outcomes of the business, have greater effectiveness, have more ownership of why they are doing the things they are charged to do, and have a greater sense of their impact on others around them
• Third – if employees are operating as leaders, they will perform in ways that create greater value to the organization

For executives of any organization to desire a fully engaged workforce, they must commit to doing the things necessary to generate this kind of inspired and generative group of employees. If the executives are creating this kind of environment, there are a few fundamental distinctions we have found that are necessary for employees to fully embrace the full power of “Anyone Can Be a Leader”.

How Can Anyone in an Organization Be a Leader?

There are fundamentally 3 steps in creating the kind of engagement demonstrated by a workforce of leaders:

1.  Commitment to Being a Leader

Commitment to being a leader comes in two parts:

1. The executives of the organization commit themselves to creating this kind of environment
2. Each employee commits themselves to think and behave as a leader in the business

2. Ownership / Accountability

3. Communication

Commitment to Being a Leader

The first step in getting everyone engaged as a leader is for the executive(s) to make a clear and public commitment to this concept. When people are empowered to demonstrate their leadership in the organization while doing their jobs, their engagement levels in executing the vision and strategies of the organization goes “sky high”. It is essential that the senior executives are fostering this kind of mindset and behavior from everyone in the organization, and that examples of “being a leader” are recognized and appreciated.

For everyone in the organization, their first step is similar – they must decide that they are going to be a leader in the organization. This decision is a personal choice, that once made, unleashes their creativity, spirit, energy – all the good stuff that are demonstrations of a highly engaged workforce.

Ownership

Any leader in the business must be fully aware of the OUTCOMES for which they are accountable. With this awareness, committing themselves to deliver the outcomes in a way that is inspiring to others. Let’s look at some definitions:

• Definition of ownership is “the state, relation, or fact of being an owner”
• Definition of owner is

1. One with an interest in and often dominion over property
2. One with the right to exclusive use, control, or possession of property

With this kind of ownership, leaders’ passion to deliver results is immediately apparent. One motto that we suggest the leaders plant in their heads: “Good excuses do not equal results!”. Leaders’ ownership and accountability for delivering the business results, and ownership and accountability of HOW they deliver results, are powerful indicators of being an inspiring leader.

Communication

For this concept of “anyone can be a leader” to work, an increase in communication by each leader is essential. A significant increase in:

• Communication up (to supervisors, managers, execs),
• Communication laterally (to peers and co-workers), and
• Communication down (to others on teams, in the organization, suppliers, contractors, customers)

This heightened level of communication elevates each of the leaders to be aware of how they fit into the big picture, with a commitment to keep the other parts of the organization aware of their status, issues, breakdowns, etc – so that more leaders are involved to maximize success.

An interesting analogy on how this plays out can be found in any team sport. Let’s use American football:

Imagine a college football team, the offensive unit, and further that one of the offensive linemen sprains his ankle. Whose problem is that player’s sprained ankle?

Clearly, it is the player’s problem. After all, it is his ankle.

However, his sprained ankle is also the team’s problem. Because now, the team does not have one player at 100% capacity.

The main job of the injured player? Communicate their problem with the team, so that the team can figure out how to execute and work around the injured player. Or the communication could result in the player being replaced by another player. Etc.

The point – the offensive lineman is demonstrating his leadership by being accountable for the success of his position, and is communicating to the team so that future plays can be adjusted to take into account the injured player.

Anyone Can Be a Leader

“Anyone Can Be a Leader” is absolutely true! We see it all the time with our clients. The value created by people not in management positions is amazing. Some of the most powerful breakthroughs and growth stories occur because of leadership from nonmanagers. Further, committing to making anyone and everyone in the organization a leader is among the most powerful interventions to increase engagement than any we have seen. It is well worth the time and effort to foster this level of engagement!

 

If you want to learn more about what characteristics and roles leadership plays in the success of any organization, download our whitepaper: ‘Successful Strategic Execution Begins With Leaders’.

In it, you will learn:

• The two hallmarks of an effective leader
• The most crucial value for leaders to possess
• The greatest contribution a leader provides
• The most valuable ‘tool’ for a leader to wield

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This article is co-authored by Bob Chapman & Larry Hoelscher

Think back over the last month. How many times have you heard any of the following statements or something close to it?

• “We operate in silos, and that is blocking us from getting the needed improvement!”
• “We are continually waiting on them to deliver … there is nothing we can do.”
• “The right hand doesn’t know what the left hand is doing.”
• “I need the organization to work together better.”

Can you see a theme present in all these statements? Even though action could be taken to improve performance in the business, it is somehow blocked. Absent that blockage, those speaking or thinking these statements would initiate the appropriate action.

So what is stopping them? Usually, the blockage occurs because others need to agree on the actions needed and take them. There is dependence on others to take action, and for whatever reason the desired action is not occurring. The people and groups with whom the dependency exists are either unaware of the desired action or have thus far been unable or unwilling to act.

Most business people do not like being dependent on anyone or anything. We like to think we are ‘captains of our own ship’ and free to act. Although this is a nice fantasy, it is not reality for most of us, as we are dependent on others for virtually everything we do.  And, in most cases, others are dependent on us for virtually everything they do.  In implementing large scale, transformative changes recognizing this is essential. We are dependent on others – transformational performance requires unique skills in interdependence.

Interdependence

The Oxford English Dictionary defines interdependency as “the fact or condition of depending each upon the other; mutual dependence”. Depend is a verb which means “to rest entirely on for what is needed”.

So, interdependence can be thought of as mutual reliance between two or more groups. Of course, there are varying degrees of interdependence.

“It is worth noting that in an interdependent relationship, participants may be emotionally, economically, ecologically and/or morally reliant on and responsible to each other.”

A key takeaway is that in a relationship with interdependence, both parties are reliant on and responsible to each other.  In achieving transformational actions, the quality of this relationship must be exceptional. It should reflect ‘Being Accountable For’, ‘Reliant On’, and ‘Responsible To’ each other!

Needless to say, that level of accountability and responsibility in interdependency is not to be taken for granted. Instead it is created and sustained with much hard work. This hard work comes from inquiry into crucial questions:

• What are we (am I) accountable for?
  • What we are looking for here is the outcome that is to be produced, rather than the process or the set of actions agreed to. Often, there is a lack of clarity on the specific outcome that is expected, while there is high visibility on the action plan prescribed.
• On whom are we (am I) reliant?
  • The transformation we are seeking in this question is FROM “I can’t do it until they …” which equals victim, TO “I am relying on them” which can equal partnership, collaboration, working together, assistance … alliance or partnership.
  • This transformation changes the nature of the interactions among the various people/teams/groups/functions, so that we observe people pulling together to deliver the desired outcome.
• To whom are we (am I) responsible?
  • Insights gained from this inquiry include ownership of our impact on others in the total organization, and consequences of this impact.

You may be thinking, “that is all well and good, but it does not happen in a complex, tough business such as mine”. Let’s look at a case example:

Case Example of Commercial Aviation

Commercial Aviation as an excellent example of a very complex and fast-moving system, with significant interdependencies.  With the aligned commitment of complete safety with zero accidents by everyone involved in this system, Commercial Aviation is one of the safest modes of transportation worldwide.

For illustrative purposes, take any one of the 8 groups of players in commercial aviation shown in the diagram below, and ask:  Regarding safety:

• For what is this group accountable?
• On whom is this group reliant?
• To whom is this group responsible?

 

To illustrate how these interdependencies work, let’s look from the perspective of one of the bubbles (Flight Crew), with a focus on one member of the Flight Crew – The Pilot:

1. Regarding safety, what is any pilot accountable for?
   • The pilot is accountable for the safety of the passengers and crew onboard, as well as the safety of the aircraft.
   • In addition, the pilot is also accountable for the safety of the system as a whole, by observing, assessing and communicating any issues that could be a safety risk, even though that safety risk may not pose any immediate threat to his/her aircraft.
2. Regarding safety, who is any pilot reliant on?
   • The pilot is reliant on:
     1. All other members of the flight crew, for their management of the passengers and the interior of the aircraft.
     2. The passengers, for following any instructions from the flight crew given for their safety.
     3. The ground crew, for external checks to the aircraft, proper loading and unloading of baggage and cargo, for safe arrival into the gate, for safe departure from the gate into the taxi flow, etc. Around the gate, the ground crew serves as the pilot’s eyes behind and around the aircraft.
     4. Air traffic control, for slotting them into a position with all other aircraft in the area, for safe flights, takeoffs, and landings.
     5. Other aircraft, for communicating issues such as bad weather, changes in altitudes, etc – especially during flight.
     6. Maintenance, for making certain that the aircraft is maintained properly for safe flights, and for evaluating and correcting any technical issues when both on the ground and in the air.
     7. The pilot is also reliant on all of the other groups shown in the picture.

3. Regarding safety, to whom is the pilot responsible?
   • The pilot is responsible to:
     1. The passengers for a safe flight.
     2. Air traffic control, for following instructions (altitude, direction, landing, taxiing, etc)
     3. Ground crew, for following their instructions on baggage, cargo, refueling, inspections, etc.
     4. Other aircraft, for alerting them with issues such as flight changes, altitude changes, up to date information regarding weather, etc.
     5. Maintenance, for alerting them to issues experienced with any component of the aircraft.
     6. The pilot is also responsible to all of the other groups shown in the picture.

Obviously, this is a very simplistic view of a complex system, but it does show the importance of the people in the system working in interdependent ways.  That is, they are accountable for safety, using appropriately all information from those on whom they are reliant, and they must be responsible to others who are counting on information from them to fulfill their roles in the system.  If any one member of any of the groups does not behave in an interdependent way, then bad things can happen.  Imagine the chaos at the very least, and danger in very real terms, if one pilot does not follow the instructions of flight control.

We could review members in all the bubbles shown in the picture.  In fact, it could be an interesting exercise by putting yourself in the shoes of anyone in any of the bubbles, and asking yourself: For what am I accountable, on whom am I reliant, and to whom am I responsible?  It can shed light on areas that need improvement, and specific things that can be done that will make a difference.  This examination is particularly enlightening when the same three questions of interdependence about any team, function, or part of an organization are honestly and thoroughly understood.

Bottom Line

Exceptional results occur when those involved in the business intendency are being accountable for, reliant on, and responsible to each other!  Working Interdependently is a crucial aspect of delivering outstanding results in systems that are getting more and more complex.

What interdependent relationships are currently hampering the performance of your business? What is possible for improving those relationships? The proper leadership to foster interdependence is critical.

 

If you want to learn more about what characteristics and roles leadership plays in the success of any organization, download our whitepaper: ‘Successful Strategic Execution Begins With Leaders’.

In it, you will learn:

• The two hallmarks of an effective leader
• The most crucial value for leaders to possess
• The greatest contribution a leader provides
• The most valuable ‘tool’ for a leader to wield

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British Columbia is one of the most beautiful regions in North America. Most think of Vancouver, Victoria and Whistler Mountain as the high points of British Columbia. Truly each of these locations is spectacular. Kelowna is one area to add to this list of amazing places in BC. This town with a native Indian name sits in the heart of the Okanagan Valley. The Okanagan Valley excels as a region for agricultural and wine. It also sits at the base of a spectacular Okanagan Lake. This deep, clear lake is breathtakingly beautiful. It also is home to the mythical sea monster, Ogopogo.

Ogopogo is described as a 40-50-foot sea monster. It has reportedly been seen by First Nations people since the nineteenth century. Another sighting reportedly happens in the 1920’s and the 1970’s. The Okanagan Lake is home to forests, logging camps and saw mills. Given the industry, many have assumed that these sightings are actually large logs floating in the lake. Who knows? Maybe there is a sea monster actually living in the lake. Regardless of the “facts”, telling the story of Ogopogo continues to this day. The retelling of the story seems to make it “more real”. One way people from this area interact with strangers is to ask if they have seen Ogopogo? It’s a good conversation starter, and ultimately a source of good humor.

Ogopogo & Business Strategy Execution

The phenomenon of Ogopogo often applies to how employees think about strategies in their organizations. That is, many people speak about their organization’s strategies as if it is a myth. Try asking people in an organization if they know their organization’s strategies. They will say that they have heard stories that it might exist, but have not actually experienced anything to prove it is real.

While it is not a problem that most citizens cannot describe Ogopogo, it is a real problem when people in an organization cannot describe their business strategy. This raises the obvious question: “Why is it that these strategies cannot be communicated, remembered and understood? Let’s look at some common reasons:

• There is not an explicit strategy. “We all know what to do” is a common statement from executives in these organizations. The absence of strategic thinking occurs as a major problem when change and growth is required.
• Plans for the primary product is seen as the business strategy. The limited view of strategy closely ties the future of the business to the future of the primary product. As the product becomes old and obsolete, the business will find itself in real trouble.
• Confuse aspirational organizational culture and practices as being a business strategy.
• Strategy is described in a large complicated document with lots of financial and market share data.

A client once described this process of producing a large document which is placed in a lovely binder for presentation to the Board. Following Board approval, the binder is placed on a credenza. At that point, it becomes “credenza-ware”, where it will remain until the next year.

Making Strategy That Will Be Executed

What then makes a strategy executable? In a Harvard Business Review video, Don Sull describes the elements required for a strategy to be implemented and executed. It must be:

• Memorable
• Understandable
• Actionable
• Simple (focused and limited # of actions based on must-win battles)

The criteria for creating such a strategy is that it must answer three questions:

1. How do we create and sustain value?
2. What are the critical issues or obstacles we must overcome to create value?
3. What are the must-win battles to overcome those obstacles and create value?

This approach produces remarkable clarity and momentum when used by leadership and a group of people who are committed to growth in revenue and value. The questions evoke robust conversations and ultimately passion drive action. One key indication of good strategic thinking is that it promotes clarity of what’s needed for successful strategic execution, and the momentum to be in action.

Two additional questions guide development of execution:

1. Two years from now, what evidence will we see that we are winning or have won this “must-win battle”?
2. Thinking from that future success, what are the actions we must take?

As the group responds to the first question, it is able to talk about the future. This is not just any future, but one in which the must-win battles are being won and success is achieved in executing the strategies. The second question identifies key elements to include in the execution planning.

 Criteria of Good Strategy

The criteria for good strategy includes the following:

• It is easy to communicate and act on
• People can see it in action
• It is tied to results

If executives and managers can clearly communicate the strategy, it is a positive sign. Likewise, if employees can describe the strategy, that is an even better sign. However, if communicating the strategy is a struggle, the execution of that strategy will likely be a struggle as well.

One reason why so many employees think there is not a strategy is they see little evidence of it being acted on. If employees can see actions and consequences of the strategies being executed, the building of momentum in the organization to support the strategy will grow exponentially. Finally, if there are clear results and positive consequences coming from execution of the strategy, the acceptance of the changes associated with the strategy will accelerate.

How Bad Strategy is Like Ogopogo

Ironically, the differences between identifying a good strategy and spotting Ogopogo are illustrative.

• Ease of communication – a good strategy is easy to describe and understand. Bad strategy, like Ogopogo, is very hard to describe and even its name is hard to understand.
• People can see it in action – a good strategy being implemented can be observed and understood. Bad strategy, like Ogopogo, is not easily seen or understood.
• It is tied to results – a good strategy produces observable results. Bad strategy, like Ogopogo, produce no consequences. Although, perhaps Ogopogo can be given credit for producing some fun, entertaining telling of stories about a sea monster living in Okanagan Lake. Similarly, your employees may think of their company’s business strategy as a great myth or legend.

If strategies are not easily communicated, producing observable action and tied to results, key stakeholders are likely to equate them with a myth about a large sea creature. Make sure your business strategy has nothing in common with Ogopogo.

 

Want to take a deeper dive on Strategic Execution? Download our whitepaper: ‘Successful Strategic Execution Begins With Leaders’.

In it, you will learn:

• The two hallmarks of an effective leader
• The most crucial value for leaders to possess
• The greatest contribution a leader provides
• The most valuable ‘tool’ for a leader to wield

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A common misconception in business is that management and leadership are the same. They are not. The impact and roles of leadership and management are quite different. Leadership is essential for companies who need to grow and create value beyond the levels given by the market. That is, to make things happen which were not already going to happen. If a business has all the growth and value creation it needs, then leadership commitment is not important. Of course, that describes few if any businesses today.

If you want to expand the importance of leadership in your organization, it is useful to determine what the term leadership means to people in your organization. Many do not have a good understanding of leadership and management, as well as why there is a distinction between the two. Many consider the two terms to be interchangeable, that is to be describing the same capabilities. Some will differentiate leaders from managers based on position in the organization. Senior managers are considered to be leaders since they have greater responsibilities.

Leadership is needed in order to produce the “elements of inspiration, vision and human passion which drive corporate success”. In case you think this description is from a recent work, that phase was written in 1977 in a groundbreaking article in the Harvard Business Review. Leaders create the environment which promotes others to excel.

The confusion about differences in leadership and management is harmful to organizations. It serves to diminish the importance of leaders, often in the organizations which most need powerful leaders. Further it reduces the emphasis placed on development of leadership, which only makes the matter worse.

Assessing the Conversations About Leadership

As a C-level executive or General Manager who is contemplating execution of growth strategies and organizational transformation, you are well advised to investigate how the conversation about leaders and leadership occurs in your organization. If you discover there is limited appreciation of contributions made by leaders, you will want to address this issue head on. As a means of investigating the conversations about leaders, I recommend you sit down with a broad cross section of your organization and ask them the following questions.

1.) Are management and leadership the same?

Chances are high that you will get one of two responses to this question:

• Yes, management and leadership are the same. “It is two words we use to describe upper levels of management” is a common response.
• “No, they are not the same”. If you ask for further explanation of the differences, the answers you hear will be muddled and unconvincing. It is likely that somewhere along the way this person has heard a discussion about the differences in management and leadership, but has not integrated the essence into their thinking.

2.) Please identify leaders in your organization.

The person answering this question will likely point toward you and other incumbents in higher level management positions within that part of the organization. There is a common misperception that senior managers are leaders while those in middle management and supervisors are not. This is a perception you will want to disrupt, since many of the strongest leaders you will need in execution are front line workers.

3.) Given who you identified as leaders in your organization, please describe what makes them a leader?

The persons will describe the “leaders” using a description of their management roles, and often the level of their management position. Seldom is there an appreciation that a leader’s role is to make things happen that otherwise would not have happened. That is, leaders interrupt the status quo and redirect the business to a future which is much more compelling.

When you asked others to identify leaders in the organizations, did anyone identify people as leaders who are not in a management position? If so, you should be encouraged! When those around you identify people as leaders in your organization who are not in a management position, you are in an organization that is open to inspiring leadership and implementing strategic change. You will often find that many of the most inspiring leaders in an organization are not in management roles.

When I give this assignment to executives and graduate students, I frequently hear that the people whom they interviewed frequently heard “we only have managers, as I am not sure our organization would tolerate actual leaders”. While this is seldom an accurate statement, it is reflective of the resignation which employees often feel about the attitudes and behavior of incumbents in management positions. It also points toward the visible absence of inspiring leadership.

Why It Matters

Success in executing strategic growth and organizational transformation requires leadership. It is the “oxygen” which maintains life in the strategic execution. As the strategic execution expands across the organization, so too must the emergence of leaders. The execution of strategies will proceed only as fast as the emergence of leadership. Likewise, the expediting of developing leadership will accelerate execution of strategies. This is why some of the most effective execution projects combine leadership of strategic execution with developing of leaders.

 

Having these conversations could be a catalyst for change in your organization. If change is on the horizon, you may want to read our whitepaper entitled, ‘Change Management vs. Change Leadership’.

In it you will gain insights and answers, such as:

• What is the key difference between these two and why is it critical?
• A simple exercise framework to look at the level of the problem driving the change effort
• Understanding the distinction between a ‘default future’ and an ‘invented future’

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This colorful phrase came from a CEO. I don’t know if he invented it or borrowed it from someone else. I worked with this new CEO to create new strategies for several of the large businesses in his portfolio. This CEO had been promoted up from one of the business units and had little experience with the other larger business units. These businesses were in the down part of the cycle, which created a challenging period for his company. Our challenge was to learn as much as we could, as quickly as possible to support the business unit executives in dramatically improving their businesses. We spent endless hours in strategic review sessions as well as a lot of time on the airplane moving between locations. Often at the end of a grueling day of leadership team development and business review, we would pile onto the plane to reflect on the day. It was at this time the assessment “not a strategic bone in the body” could be used when describing the management team.

It’s wasn’t that these executives were not intelligent – they were. Nor was it that they didn’t know their businesses – they did. Unfortunately though, all they knew was the operational side of the business. For quite some time there had been a lack of organizational accountability for strategic thinking. Consequently, these executives did not recognize that operations and strategy were different. They were “out of balance”, in that they were strong on operations and weak on strategy. The lack of balance between operations and strategy was an issue for the previous CEO, which was part of the reason my client was hired to replace him. This body was in definite need of leadership team development, particularly in the area of strategic thinking.

These executives could go into great detail with operational data. They knew their “facts and figures”. What they were missing was strategic thinking about what the data indicated, as well as the strategic factors that were influencing the data. They knew that the level of housing starts in the US was lower and that was affecting their business. Little thought had been given, however, to what was causing the slowdown in housing starts and how these reasons might affect future market levels. Instead, there was the assumption that the market for their products would come back and they would be ready when it did. In fact, they had invented a term to describe their positioning: “Profit Ready”. Unfortunately, “Profit Ready” was based on assumptions that the market would come back just as it was before the downturn. It also provided excuses for not thinking strategically about changes that could be made, as well as risks that could be mitigated.

The Challenge

As a consultant working with this executive team, one of the challenges I faced was assuring we did not fall into scapegoating these various executives. While it was frustrating to sit in sessions with these highly-compensated executives and observe their limitation as strategic thinkers, I kept reminding myself and our team that these executives were the product of the organizational culture.

Our task was to create a breakthrough design for rapidly developing executives into business strategists. We began by communicating the need for strategic thinking and assisting the executives who were willing to develop as quickly as possible. Learning to becoming a strategist while in an executive role is a major challenge, akin to learning to downhill ski or play golf as an adult. While observing children learning those sports is thrilling, the same cannot be said of watching adults do the same.

The Interventions

Teaching an executive to be a strategist requires the following actions:

• Stop the charade. At first some of the executives were in denial and would push back. This pushback was usually in hopes that the new CEO would back off. The CEO, however, was direct and forceful about ending the pretense. For some of the executives, the road ended here. They were unable or unwilling to acknowledge the situation, and made no further development.
• Acknowledge difference between operations and strategies. Both are important, just different. The executives could delegate most of the operational focus to others in the organization, and focus on strategic thinking. The pivotal first step was recognizing the distinction between the two.
• Acknowledge difference between leaders and managers. Again, both are important, just different. The executives were highly trained as managers, and were good at it. While the term leadership was used widely in these businesses, there was little understanding of what it is. These businesses were classic examples of what John Kotter calls “Over-managed and Under-led.”
• Value the attributes and behaviors of strategic thinking. The culture needed to be transformed. The important strategic behaviors of inquiry, continuing to question rather than moving to a conclusion, and allowing ambiguity to persist are the opposite of desired behaviors in an operational context. Attitudes and behaviors which are rewarded in the strategic arena are likely punished in operational areas.
• Encourage thinking about the future rather than the past. Effective strategies deal with the future and do not assume the future is a continuation of the past. These executives had assumed their forecasting based on past performance was strategic thinking. That is flawed thinking.
• Stop relying on ‘knowing’ as the future is not known. Since the future has not happened, it cannot be known. This is quite frustrating to managers with engineering and technical backgrounds. Their training and skill set comes from facts and knowing. Yet facts and knowing are rooted in the past. Overuse of facts and knowing inadvertently pulls the mind back into the past, and seriously limits the capacity to think strategically.
• Enable freedom to fail. Thinking strategically involves creativity, innovation, and experimentation. Excessive concern about “looking good” and getting the right answer is very constraining. Failure is a valuable source of learning and knowledge. Attempting to avoid failure or hiding it when it happens is detrimental to thinking strategically.
• Instill courage to step out and try something new. Like dancing and singing, thinking strategically can be exhilarating once the person gets over the initial concerns and timidity. In dancing, sometimes the best thing to do is get out on the floor and let go of being self-conscious.

Most of us were born without strategic bones in our bodies. We learn through great effort and over time through trial and effort. Strategic thinking is a must for organizations today who are dealing with ever increasing complexity and challenges. Organizations must also attend to developing capability for thinking strategically, and not confuse excellence in management with leadership and strategic thinking.

 

How is the level of strategic thinking in your organization? What are you doing to increase it? Where have you inadvertently delegated it to someone else with hope they would do it for you? What actions can you take right away to change that. Answers to these questions and more can be found in our whitepaper: ‘Successful Strategic Execution Begins With Leaders’.

In it, you will learn:

• The two hallmarks of an effective leader
• The most crucial value for leaders to possess
• The greatest contribution a leader provides
• The most valuable ‘tool’ for a leader to wield

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One might think that the leadership in strategic execution is obvious and straight forward. For example, the role of leaders is to guide the organization in executing its strategies and achieving expected results. This seems so obvious. My mom often used the phrase, “It’s as obvious as the nose on your face” to describe things such as this. While this role of leaders seems evident, in practice it often does not work out that way. The research on the effectiveness of strategic execution initiatives finds that more than half do not deliver the results. In fact, some estimate the failure rate to be between 66% and 85%.

How come? Clearly, leadership is not getting the job done.

Donald Sull gives a common explanation used by leaders in this situation, “We had a good strategy, but lousy execution”. Sull calls this a “cop-out”, and goes on to assert that the problems begin with the strategies which were likely too complicated and not designed with execution in mind. I strongly agree with Don Sull on this point. Further, I assert that the dynamic begins with leadership accountability.

Let’s look at some examples.

Be a Strategic Thinker and Do Not Delegate

A common assumption is that most executives excel as strategic thinkers. I find that most executives excel as operational thinkers. By and large executives have outstanding knowledge about the financial and operational aspects of their business. They are usually hyper busy dealing with a myriad of operational issues. Many executives, however, are not particularly skilled in thinking strategically. You might ask, “But what about all the time which is spent developing the business strategies?” If you look closely you will see the focus is on operations, with an implicit assumption that the business in the future will look remarkably similar to how it has looked in the past. This explains why so many businesses are caught flat-footed when their markets change dramatically or disruptive technologies and innovative business models interrupt their industry.

I have observed that many executives outsource the strategic thinking by delegating staff work to others in the organization and / or dependending on external organizations. There is a subtle difference in engaging others to support framing the strategic questions and outsourcing the strategic thinking. Having groups in the company do staff work to develop data and knowledge is excellent practice, as is engaging external experts. The difference is in maintaining accountability for the thinking. When the executive has maintained organizational accountability for strategic thinking, there is a stimulating environment in which the internal and external parties can collaborate in powerful ways. If the executive does not maintain the organizational accountability for strategic thinking, a very different mood develops. Unease increases as this accountability and power vacuum becomes apparent. Ambitious individuals and organizations see the opportunity to grab power, and the positioning begins. The soap opera unfolds over time as the execution plans are developed and implemented. Of course, this dramatically increases the probability that the strategic execution will be flawed and ultimately fail.

Must Lead Change

Successful change does not happen simply because we wish it would. We cannot will it into existence. Nor can executives delegate the accountability for leading change. Instead, they must create organizational structures that empower accountability to assure the changes move through the predictable opposition and resistance. Leading change requires creating a vision for the change, establishing a strong sense of urgency for why change is needed, engaging a core of leaders, communicating powerfully, creating the right climate for change, coordinating activities, engaging stakeholders, maintaining momentum, dealing with surprises, and removing roadblocks. Executives must exercise the internal leadership needed to propel strategy information forward.

Often the group which requires the most attention from executives is middle management and supervisors. Most of these people have achieved their position and status in the company through their effectiveness in maintaining control. Strategic execution initiatives often alters these control structures, since this interruption is needed to promote growth. In the role of change leaders, executives need to pay attention to these middle managers and supervisors. Supporting these managers in making the changes will trigger a huge difference, as ultimately the change leader wants these managers to be effectively engaging others in the organization in making the changes. In organizations with hierarchical, top down management orientation, it is common for managers and supervisors to attempt to implement change through domination rather than enrollment. Needless to say, domination as a change method has very limited success.

Provide Credibility with Stakeholders

Strategic execution initiatives are an opportunity in which executives will enhance or lose credibility with the various stakeholders. Stakeholders is a term used to describe the various groups or individuals who believe they have “something at stake” in the behavior and success of an organization. Usually, there are a wide variety of stakeholders such as employees, customers, suppliers, investors, retirees, community leaders, politicians, and governmental officials. When the strategy being executed involves meaningful change, the various stakeholders will likely have differing opinions about the changes. How the executives provide leadership will determine whether they enhance or lose credibility with the various stakeholder groups.

Display Competence and Confidence

Growth companies require a lot of competence and confidence. This is why the caliber of leadership from top executives during strategy execution is so important. This includes leadership in strategic thinking and developing others as strategic thinkers. This involves eschewing conventional thinking, not for the sake of nonconformity, but because they are focused on the fundamental questions about the company’s strategies. These fundamental questions include how we can best execute our strategies.

Conclusion

Successful strategic execution initiatives require leadership from executives. They cannot be over-managed and under-led. Ultimately, change is needed by mid-level managers and supervisors to champion the execution rather than focus on controlling people. Success in engaging the various groups of stakeholders will enhance leadership’s credibility, as well as enhance support for the strategies being executed.

Leadership of strategic execution cannot be abrogated through delegation to others. It must be taken up by those in the positions to do so. This leadership accountability is essential for success.

 

If you want to learn more about what characteristics and roles leadership plays in the success of any organization, download our whitepaper: ‘Successful Strategic Execution Begins With Leaders’.

In it, you will learn:

• The two hallmarks of an effective leader
• The most crucial value for leaders to possess
• The greatest contribution a leader provides
• The most valuable ‘tool’ for a leader to wield

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