In a world where standing still is akin to moving backward at the speed of change, I often encounter management teams operating in a state of denial about the world unfolding in front of them. They get caught up in supporting dated strategies while preoccupying on the swirl of activities in the present.
Instead of looking outward at market forces and rising competitors, many management teams get wound around the axle of their own little universe. The results follow a particularly predictable flail and fail outcome. Top managers and management teams need to deliberately fight the tendency to preoccupy solely on the here and now, and ensure adequate consideration (backed by actions) is given to designing their firm’s futures.
The Gravitational Pull of the Short-Term Is Powerful—You Have to Fight It
I’ve been in fast moving environments as a senior manager, and frankly, I understand how easy it is to be drawn into the swirl of operational issues and the urgent-important and lose sight of the future. The next board meeting, the quarter close, the upcoming industry event—all of these and more keep our eyes squarely focused on running the business. It takes extraordinary energy to break the grip of this moment in time and invest in designing your firm’s future.
Here are some approaches I’ve observed management teams use to avoid the doom-loop of short-term focus and work on setting the business up for future success.
Four Big Behaviors of Forward-Planning Management Teams
1. Looking and Acting on the Future is a Part of the Routine of the Business
The work of strategy is an on-going, never-ending process, not an annual event. While these firms typically have rigorous operating routines designed to optimize near-term results, they have similar strategy routines that demand equal rigor in looking externally and planning for the future.
Too many firms blend operations discussions with strategy. Said another way, anything that falls under the label of “strategy” quickly devolves to an extended debate over operating budgets, resources, or organizational structure. The strategy is never covered.
One organization relies on a 3-legged stool approach that ensures that operations, strategy execution, and strategy work are always on the calendar and receive ample focus.
- The operations routine includes assessing results and planning for short-term moves.
- The execution leg focuses on identifying new insights gained in the marketplace and translating lessons learned into adjusting tactics around the current strategy.
- The strategy leg involves quarterly work with individuals throughout the organization (as well as customers, partners, and other influencers), where the only rule is that operational issues cannot cross into the discussions. The sessions are focused outward and toward the future.
The firm has successfully navigated a transition from an old-line, generalist industrial company to a fast-moving industrial and technology leader in multiple niche markets.
2. Designing the Future Demands Managing the Portfolio Over Multiple Time Horizons
Top teams are portfolio managers, looking at investments over multiple time horizons and providing the capital, resources, and tailored management support necessary in each horizon.
These teams understand it’s the portfolio of investments over different time horizons and the disparate treatment of these investments that are critical to designing the future. Short-term investments are expected to deliver in the current budget year, while one-to-three year investments require shepherding and very different measurement and evaluation approaches.
Want to run an acid test for your firm? Take a look at the product investment roadmap and assess the allocation of dollars for initiatives expecting to pay-off in different time horizons. If there’s nothing or close to nothing in horizons beyond the upcoming twelve months, there’s a problem.
Also, assess your firm’s track record in bringing new ideas to fruition. If everything you are investing in is an extension of today’s offerings, there’s a problem. Inertia is hard to break, but long-term organizational health depends upon learning to navigate new and different.
3. Attacking the Status Quo is Expected
In too many organizations, pushing back at the way it’s been done, particularly when it comes to making money and serving customers, is a fast-track to the penalty box. In healthy organizations, there’s an expectation that people will continuously challenge assumptions and push-back at the status quo. This culture starts at the top with a CEO (first and foremost) and top managers who encourage and actively model this behavior.
I learned this lesson in real time as I observed a senior manager challenge conventional thinking by proposing a new business vector that flew in the face of the firm’s history. This individual expended all of his political capital to gain grudging support and then proceeded to leverage the idea into a major makeover of the entire business. Ultimately, it was the CEO who enabled this experimentation by challenging the collective group of managers to back their words about experimentation and innovation with actions.
4. Challenging Conversations are Exercises in Aggressive Respect
Everything important in the workplace happens through one or more challenging conversations. If the prevailing culture in the firm and on the management team is one of collegial engagement, chances are, the right discussions aren’t taking place. You don’t design the future, challenge conventional wisdom, and reinvent your organization without well-intended, spirited dialog. Keep it respectful—it’s about the issues, not the people—but don’t shy away from the tough stuff.
In working with management teams, helping smart, high-powered people learn how to debate and discuss and occasionally fight, is one of the core issues. One new CEO lamented, “The team is collegial, but they don’t know how to take on the big topics critical for our future.” With challenging conversations training and facilitated guidance, they learned to go hard after the right issues without making anyone feel like it was a personal attack.
The Bottom-Line for Now:
Great management teams are hungry to win in the moment and relentless at building for the future. It takes discipline and deliberate efforts to separate the here and now from an imagined but uncertain future—yet success over time demands this effort and discipline. Peter Drucker was right: “Actions in the present are the one and only way to create the future.” The question is, are you investing in the right actions?