The Lost Art of
Thinking in Large Organizations
By
Duncan Simester
Many executives in big companies
attained their positions by excelling at getting things done. Unfortunately, a
bias for doing rather than thinking can leave these executives ill-equipped for
their new roles.
How did we arrive in a state where managers do not
recognize that thinking is part of their job? The answer reflects a relentless
focus on execution in many large companies. A company becomes big by finding a
successful business model — and then scaling it massively. This necessitates
building a finely tuned system with highly standardized processes. To get
promoted in such an environment requires an almost singular focus on execution.
In other words, it requires action more than thinking. However, once executives
are promoted to a senior level, these new business leaders must be able to
think strategically. Ironically, the very skills in execution that led to their
promotions often make these executives ill-equipped for their new roles, since
their strategy thinking muscles have withered from disuse.
How to Find
Strategic Insights
The goal of strategic thinking is to find strategic
insights. Strategy is all about choices — about which markets to compete in and
which markets to avoid. Strategic insights describe the boundaries separating
attractive markets from unattractive markets. For example, Amazon.com Inc. had
the strategic insight that it could marry its investment in computing
infrastructure with its unparalleled e-commerce capabilities to develop an
attractive new business offering cloud computing services, Amazon Web Services.
Although strategy is about the big picture, strategic
thinking often starts in the weeds. To think about strategy, start with a
specific customer example (a “use case”) and ask: How can we make money from
this customer? Now change an assumption and see whether the answer changes.
This is what good thinking involves: evaluating hypotheticals and pivoting from
one hypothetical to another. At this stage, you are not looking for the best
solution. What you are looking for are the boundaries that identify where your
company can compete effectively (and where it cannot).
Does starting with narrow examples mean you risk not
exhausting every possibility? That is more than a risk; it is a certainty. An
exhaustive search is not your goal in strategic thinking. Instead, good
strategic thinking sacrifices breadth for depth. Functional managers
transitioning to become senior leaders must learn to embrace ambiguity and
uncertainty. They will struggle to progress if they try to validate every
assumption. A high-performing strategic team recognizes uncertainty — and
progresses despite it.
How Do Leaders
Find Time to Think?
Delegation is the key to finding time to think. When I
work with managers from large organizations, I make the programs nine to ten
weeks long — long enough to force them to delegate. This is often the first
time they have delegated in such a substantive way. At the end of the program,
many are surprised to discover how well their teams performed without them and
vow to keep delegating more — freeing up time to think, while their teams
delight in their new responsibilities. These executives are transitioning from
being mere managers facilitating execution to becoming strategic leaders who
spend time thinking carefully about how best to deploy their teams.
Who Should Think About Strategy?
Realistically, not all employees need to engage in
strategic thinking (although that would be nice). This question of who in an
organization should be thinking about strategy can be reframed as: Who is
responsible for strategy? In a startup or small company we look upward for
strategy. The danger is that as companies scale, we continue to look up to the
company’s most senior leaders for strategic direction. Yet, as the organization
grows, these senior leaders can become distant from the details of the business
and emerging trends affecting it — and that can hinder their ability to make
the best strategic decisions.
Bill Gates, cofounder and former CEO and chairman of
Microsoft Corp., countered this challenge effectively through a technique he
called “Think Week.” While leading Microsoft, Gates would go on a secluded
retreat twice a year; during that time, he would immerse himself in reading and
thinking about technology trends affecting Microsoft’s business. Because his
“Think Week” reading material included reports written by Microsoft employees
all over the world, this practice allowed Gates to glean strategic insights
from developments employees were seeing in the marketplace. “It’s the world’s
coolest suggestion box,” one Microsoft manager told The Wall Street Journal in
2005.
Busy as he was as a senior Microsoft executive, Bill
Gates made sure to set aside time to think. If your managers claim they do not
have time to think, you have a problem. You need them to know not just that
they have permission to take time away from doing to think — but that they are
required to do so. You must also help rebuild their withered strategic thinking
muscles.
The threat of not doing so is clear. While you may be
executing well in your core business, companies that prioritize doing at the
expense of thinking are not well-positioned to identify new markets or pivot to
new opportunities when their core business matures. In other words, a singular
focus on what made your company big risks preventing it from sustaining that
growth in the future.
Source | MIT Sloan
Management Review – summer 2016
Regards!
Librarian
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