Most organizations and leaders are poor at detecting ambiguous threats and opportunities on the periphery of their business. Coors executives, famously, were late seeing the trend toward low-carb beers. Lego management missed the electronic revolution in toys and gaming. Strategic leaders, in contrast, are constantly vigilant, honing their ability to anticipate by scanning the environment for signals of change.
We worked with a CEO named Mike who had built his reputation as a turnaround wizard in heavy manufacturing businesses. He was terrific at reacting to crises and fixing them. After he’d worked his magic in one particular crisis, Mike’s company enjoyed a bump in growth, ...view middle of the document...
List customers you have lost recently and try to figure out why.
Attend conferences and events in other industries or functions.
Strategic thinkers question the status quo. They challenge their own and others’ assumptions and encourage divergent points of view. Only after careful reflection and examination of a problem through many lenses do they take decisive action. This requires patience, courage, and an open mind.
Consider Bob, a division president in an energy company we worked with, who was set in his ways and avoided risky or messy situations. When faced with a tough problem—for example, how to consolidate business units to streamline costs—he would gather all available information and retreat alone into his office. His solutions, although well thought out, were predictable and rarely innovative. In the consolidation case he focused entirely on two similar and underperforming businesses rather than considering a bolder reorganization that would streamline activities across the entire division. When he needed outside advice, he turned to a few seasoned consultants in one trusted firm who suggested tried-and-true solutions instead of questioning basic industry assumptions.
Through coaching, we helped Bob learn how to invite different (even opposing) views to challenge his own thinking and that of his advisers. This was uncomfortable for him at first, but then he began to see that he could generate fresh solutions to stale problems and improve his strategic decision making. For the organizational streamlining he even assigned a colleague to play devil’s advocate—an approach that yielded a hybrid solution: Certain emerging market teams were allowed to keep their local HR and finance support for a transitional period while tapping the fully centralized model for IT and legal support.
To improve your ability to challenge:
Focus on the root causes of a problem rather than the symptoms. Apply the “five whys” of Sakichi Toyoda, Toyota’s founder. (“Product returns increased 5% this month.” “Why?” “Because the product intermittently malfunctions.” “Why?” And so on.)
List long-standing assumptions about an aspect of your business (“High switching costs prevent our customers from defecting”) and ask a diverse group if they hold true.
Encourage debate by holding “safe zone” meetings where open dialogue and conflict are expected and welcomed.
Create a rotating position for the express purpose of questioning the status quo.
Include naysayers in a decision process to surface challenges early.
Capture input from people not directly affected by a decision who may have a good perspective on the repercussions.
Leaders who challenge in the right way invariably elicit complex and conflicting information. That’s why the best ones are also able to interpret. Instead of reflexively seeing or hearing what you expect, you should synthesize all the input you have. You’ll need to recognize patterns, push through ambiguity, and seek...