Books, Leadership, Management, Question, Women

Two Yardsticks for Measuring Risky Decisions

How Women Decide: What’s True, What’s Not, and What Strategies Spark the Best Choices by Therese Huston is a fascinating book. How do you make decisions? Do you know the risk in making your decision? Below is an excerpt from the book:

Two Yardsticks for Measuring Risky DecisionsHow women decide.jpg

Are there strategies for figuring out when to take a risk? I was torn on whether to include this advice because I don’t want to send the message that women are, underneath it all, fearful of risk. The data doesn’t support that. But whether you’re a man or a woman, someone who takes too many risks or too few, you need strategies for evaluating new opportunities. There are any number of risky decisions you might be considering. Maybe you’re thinking about taking a new job or quitting your current one. Maybe you’re trying to decide whether to invest your time in a project that your friends think is a dead end but that you believe is just beginning. I’m going to offer two tools, two yardsticks you can use to measure a daring move and whether it’s headed in the right direction.

The first tool is the 10-10-10 rule, developed by the journalist and author Suzy Welch. The purpose of this strategy is to help you look at a decision from three angles, with the hope that one of those vantage points will provide a pop of clarity. In her book 10-10-10, Welch offers three easy-to-remember questions: “What are the consequences of this decision in 10 minutes? In 10 months? In 10 years?” Simple, yes, but potentially quite powerful. The goal isn’t to constrain you to those exact numbers – you could think about two days, six months, and seven years from now. The goal is for you to think about the immediate consequences, the impact your decision will have in the foreseeable and imaginable future and in a distant part of your life, a time far enough in the future that you can’t predict the intervening details or events but you still have clear hopes for yourself. Imagining forty years out is probably too far. The idea is that all too often when we’re trying to make a decision, we’re focused on one, maybe two of these time frames, but wisdom might lie in considering all three.

The second tool for sizing up a risk is something called a premortem, a strategy discussed in the bestseller Thinking, Fast and Slow, by Daniel Kahneman, a Princeton University professor and Nobel Prize- winning economist who has been studying reasoning and decision- making for over forty-five years. You may be familiar with a postmortem, which is what you do when a project or event is over, but a premortem is just what its name suggests – a step you take before the project launches, before you’ve committed to a plan of action and the risks that come with it. The concept is simple. Once you have a concrete plan on the table, bring together the key people who know about the decision you’re making and say, “Imagine that it’s a year into the future and we’ve gone ahead with our current plan. The result was a disaster. Take five to ten minutes and write down a brief play-by-play of that disaster

You might not be immediately impressed with this strategy. You’re thinking, But I’ve already asked “What could go wrong?” a dozen times. But that question involves looking forward, to possible events in the future, whereas the premortem involves looking back. (A premortem is similar to the look-back we discussed in chapter 1.) Looking back may not seem like much of a shift, especially since it’s all in your imagination, but this small shift in perspective can be profound.

Consider these two questions: “How likely is it that an Asian American will be elected president of the United States in 2024? Why might this happen? List all the reasons that come to mind:’

Before you read on, take a moment to think about this future possibility and generate some ideas.

That was looking forward. Now consider these two questions: “It’s 2024 and an Asian American has just been elected president of the United States. Why did this happen? What events might have preceded this one? List everything that comes to mind.”

If you’re like most people who’ve been asked these questions, a wider variety of vivid details come to mind in the second, hindsight scenario. It’s not just that you’re getting a second chance to think about the same event – people generate better answers to the hindsight questions even if they never heard the first ones. Deborah Mitchell at the University of Pennsylvania, J. Edward Russo at Cornell University, and Nancy Pennington at the University of Colorado collaborated on a project and found that people who are given the second, hindsight scenario generate 25 percent more reasons than people given the first, foresight scenario.” Perhaps even more important, people generated more specific and concrete reasons in the hindsight scenario. When we think about future events, we’re content to think in broad generalities, but when we think about something that has already happened, we feel a need to provide more convincing explanations. This is why the premortem is so effective- it’s looking back at a fictional event as though it’s happened. You’ve always heard that hindsight is better than foresight, and that, remarkably, includes imaginary hindsight.

 

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Blogs, Leadership

HBR: The 4 Leadership Styles, and How to Identify Yours

What is your leadership style? My leadership style is a Solution Finder. Below is a blog from the Harvard Business Review by Bill Taylor.

The 4 Leadership Styles, and How to Identify Yours

We all want to be part of a great success story. To run, start, or play a senior role in a company that wins big or changes the course of its industry. To launch a brand that dazzles customers and dominates its markets. To be the kind of executive or entrepreneur who creates jobs, generates wealth, and builds an organization bursting with energy and creativity.

Which means that all of us, no matter where we are in our career, have to wrestle with the big questions of leadership: What is our personal definition of success? What does it mean to make a difference and have an impact? What is the best way to rally colleagues to our cause, to handle problems and obstacles that inevitably arise, to revise plans in the face of setbacks or to stand pat no matter the odds? How much do we rely on our own ideas and experiences, and how widely do we seek the advice and support of those around us? If we hope to succeed, we need to understand how we lead.

Over the last three decades — first as a young editor at Harvard Business Review, then as cofounder of Fast Company magazine, now as a book author — I’ve spent time with truly remarkable leaders in a vast range of fields. All of them have achieved tremendous success and impact, and none of them has done it in precisely the same way. But I’ve been able to identify four styles that capture their different approaches to the whys and hows of leadership, and I’ve come up with a set of 16 questions to help you figure out which style suits you best. There are no right answers to these questions, of course, no one way to lead. But each of us has to figure out which style of leadership fits who we are and what we are trying to achieve.

What are those four styles of leadership?

The Classic Entrepreneur. As legendary investor John Doerr likes to say, classic entrepreneurs do “more than anyone thinks possible with less than anyone thinks possible.” Leadership is about the thrill of competition and the quest for success. No-nonsense variables, such as costs, quality, profit margins, and savvy deals, are the metrics that matter. Sure, these leaders care about the values their company stands for, but it’s the dollars-and-cents value proposition that matters most. They love to build killer products and butt-kicking companies. They are, in Doerr’s words, and he doesn’t mean this critically, “opportunistic” — they revel in “the pitch” and “the deal.” When faced with decisions about launching a new product, or dealing with a disgruntled customer, or selling the company to an eager suitor, they focus on tough-minded calculations and no-nonsense financial returns.

The Modern Missionary. These leaders aim for more than mere business success; they aspire to success and significance. Winning is less about beating the competition than it is about building something original and meaningful. Success is less about making money than it is about making a difference and having an impact. Sure, economic value is important, but human values are what drive their passion to succeed. So these leaders may take risks that classic entrepreneurs won’t, even if the short-term returns aren’t obvious, or they may turn down deals that others might accept, because the financial payoffs aren’t as important as the broader impact they hope to make. These leaders don’t just want to run companies; they aim to turn their companies into a cause.

The Problem Solver. They worry less about dramatic impact than about concrete results. They believe in the power of expertise and the value of experience. Disruptive technologies and blank-sheet-of-paper business models may be reshaping markets and industries, but past success is a good predictor of future impact. So as they rise through the ranks or lead organizations they’ve built, problem solvers are the first to confront difficulties and identify new opportunities. Yes, they rely on the advice of colleagues, but ultimately they fall back on everything they’ve learned and seen to guide the organization into the future. These top-down, take-charge, the-buck-stops-here executives may be the most recognizable sorts of leaders, in terms of the image we carry around of what it takes to get things done.

The Solution Finder. This style is about incremental results and concrete solutions, but these leaders believe that the most powerful contributions often come from the most unexpected places — the hidden genius of their colleagues, the collective genius that surrounds their organization. They are committed to making sure that what they know doesn’t limit what they can imagine. They’re ultimately responsible for business results, but they believe that achieving those results is everybody’s business. These modest, humble, self-effacing leaders don’t make headlines, but that doesn’t mean they’re not ambitious. They believe that humility in the service of ambition is the right mindset to do big things in a world of huge unknowns.

Why is it important to gain clarity about the leadership style that fits each of us best? Because the more we understand about ourselves — what we truly care about, how we make decisions, why we do what we do — the more effective we will be at marshaling the support of others for what we hope to achieve. In a time of wrenching disruptions and exhilarating advances, of unrelenting turmoil and unlimited promise, there have never been more roads to success — or more opportunities to fail.

Author’s note: I’ve created a 16-question quiz on my website to help you figure out your style. It’s free, but you do have to enter your email address to get your results.

 

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Leadership, Management

How to Conduct a Business Meeting

Business meetings are often unproductive. The following outlines some tips to help ensure a productive meeting. There are three importance things to determine before scheduling a meeting: purpose, agenda, and people.

Purpose

The purpose of the meeting should be clearly stated and communicated to participants. Both the agenda and materials should be sent to all members before the meeting. Let everyone know that the materials should be reviewed prior to the meeting and to come prepared to discuss the topics at hand. Discussions at meetings are important and silence may denote that you’re in agreement with the topic. Ground rules should be made clear.  These may include things such as no cellphones or laptops allowed in the meeting. Also, the meeting should start on time, so arrive 5 to 10 minutes early to network beforehand.

Agenda

The agenda is used to guide the meeting. Each agenda item should have a designated amount of time noted on the agenda either written in minutes or beginning time (3:15pm). An alternative approach is to use a shot-clock which is a timer used to countdown the minutes.

You may want to assign someone to take notes for the meeting. These notes can be either formally typed up and distributed after the meeting or simply make a copy or take a picture of the handwritten notes and email them to the group.

The notes should include the agreed upon action items and assignment of those task s to a responsible party. As a group leader you will need to follow up with the individual responsible for all action items before the next meeting.

People

The last item, but perhaps the most important is deciding who should attend the meeting. There isn’t any magic number on the number of attendees. However, many recommend no more than 6-8 people or you can use Jeff Bezos’s two pizza rule; limit participants to the number two pizzas would feed. Involve those who have a stake in the agenda and will add value. Finally, at the end of the meeting there should be a recap of the results of the meeting, next time steps to be taken, and the responsible party for those actions.

A little extra planning can go a long way to increasing the productivity of any meeting.

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Blogs, Leadership, Management, Productive

HBR: 4 Ways to Be More Effective at Execution

Do you have an execution problem? Below is a blog from the Harvard Business Review by Jack Zenger and Joseph Folkman.

4 Ways to Be More Effective at Execution

Most people recognize that execution is a critical skill and strive to perform it well, but they may a) underestimate how important it is to their career advancement or b) not realize that you can improve on execution without working longer hours.

On the first point, bosses place a premium on execution, which we define as the ability to achieve individual goals and objectives. In fact, when we asked senior managers to indicate the importance of this ability, they ranked it first on a list of 16 skills. Other raters in the organization ranked it fourth, behind inspiring and motivating, having integrity and honesty, and problem solving. We recognize that there are many parts of your job that are important, but if you want to move ahead in your career, it might be time to double down on simply getting more stuff done – it’s what your boss wants to see.

Which brings us to the second point. Many managers react with defensiveness or despair to this news; after all, most of the managers we know already feel like they’ve got too much to do. People who are lethargic, slow, or unfocused are rarely (at least in our experience) promoted to upper management positions. The leaders we know already work hard and long – and working harder and longer is not a viable option. In the short term this typically yields improved results, but in the long term leaders burn out. And if they’ve pushed their teams to do the same, team members quit.

But our data – gleaned from tens of thousands of 360-degree performance reviews — tells us that there are more sustainable methods of improving execution. We looked at thousands of leaders who were rated as being highly effective at execution and looked for the coinciding behaviors that enabled this skill. We found a set of behaviors that improve execution. Four behaviors in particular stood out:

Be clear and methodical

Many people who are energetic about execution tend to jump into activities and take action before they get organized, create a plan, or connect what they’re doing to the strategy of the organization. Having the discipline to organize people, assemble resources, and then generate a plan that others can commit to will collectively improve execution. So will making clear who is doing what; we have learned that when everyone is collectively responsible, that no one is responsible. Providing others with clear direction and a sense of connection to the strategy of the organization helps people understand how the work they are doing dovetails with the organization’s mission.

If you are quick to jump into action and tend to start project without a well-organized plan of attack, or if you get feedback on your lack of planning and organization, this suggestion might be one to focus on. An individual contributor might be able to get away with being disorganized, but it rarely works out well at the senior management level.

Set stretch goals and deadlines

Setting stretch goals helps the group achieve their objectives and generates greater engagement and satisfaction in team members. To push the group to achieve those goals, pair them with deadlines. While we may not like it, when someone gives us a deadline, our behavior changes. Simply setting deadlines for goals and objectives goes a long way toward achieving those goals and objectives! If you resist setting stretch goals for your team, start by asking your team questions like, “What would it take to accomplished this goal two weeks earlier?” We find that by challenging your team and supporting them in accomplishing a difficult goal, team members actually feel more engaged and satisfied with their jobs.

But don’t go overboard; we’ve also found that too much pushing can erode trust, which will hurt execution in the long run. When an untrusted leader asks for additional effort, people question their motives and resist their requests. Moreover, involving your team in the process of setting goals deadlines will increase their sense of commitment and autonomy.

Give more feedback, especially more positive feedback

This is all about improving execution through intrinsic motivation, rather than through goals and deadlines. Leaders who are great executors are skilled at giving feedback. Specifically, the leaders who rate most highly are those who deliver critical feedback by taking the time to listen to and understand their employees’ perspectives, rather than simply dropping a difficult message on someone and ending the conversation as quickly as possible.

But where we really saw a major difference was with positive feedback. Specifically, we found that leaders who are great at execution give a lot more positive recognition. Our research indicates that while giving a little more recognition did not affect execution, being above the 65th percentile on this skill had a major impact.

Resolve conflict and build team unity

Have you ever been part of a team so great that you love coming to work? Teams like this probably do all or most of the above – work assignments are clear and processes make sense, deadlines are ambitious but fair, and feedback is plentiful – but they also do something more. On these teams, it’s not just the boss motivating team members — the expectations of peer team members are powerful motivators, too. Creating this kind of team culture is an important element of good execution. While there’s a lot that goes into building high-performance teams, in our experience, perhaps the biggest single thing for leaders to focus on is resolving conflict. That’s because many of the problems within a team come from differences and conflict between team members; on high-performing teams, team members trust each other and conflict is constructive, not destructive or personal.

As you think about your ability to execute we feel that all three of these dimensions are critical. You may focus on one or two and find that one is lacking. But our research shows that balancing all four of these factors is the strategy that will improve execution most of all.

Finally, if you’ve made it this far and you really feel like you’re already doing all of these things, and yet somehow you’re still perceived as having an “execution problem,” consider this: in our research, we also found that there’s almost a one-to-one relationship between leaders who are seen as fast, and those who are seen as great executors. Previous work we’ve done has shown that some of the above things – setting stretch goals, having clear processes in place, and building trust, for example – will help you move faster. But you may also need to give your peers and bosses more evidence of your speed by, for example, being more transparent about how many projects you’re working on and where they are in your pipeline.

 

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Books, Leadership

Originals: Movers and Shapers

Originals: How Non-Conformists Move the World by Adam M. Grant is an impressive book. He explores how to recognize a good idea, build a coalition of allies, choose the right time to act, and manage fear and doubt. Below is an excerpt from the book:

Movers and ShapersOriginals.jpg

To his credit, Dalio has been running an investigation of his own. Fascinated with understanding people who shape the world and eager to discern what they have in common, he’s been interviewing many of
the most influential originals of our time, and studying historical figures from Benjamin Franklin to Albert Einstein to Steve Jobs. Of course, all of them were driven and imaginative, but I was intrigued by three other qualities on Dalio’s list. “Shapers” are independent thinkers: curious, non-conforming, and rebellious. They practice brutal, nonhierarchical honesty. And they act in the face of risk, because their fear of not succeeding exceeds their fear of failing.

Dalio himself tits this description, and the hurdle facing him now is to find another shaper to fill his shoes. If he doesn’t, Bridgewater may vanish like Polaroid’s instant pictures. But Dalio knows that preventing groupthink is about more than the vision of a single leader. The greatest shapers don’t stop at introducing originality into the world. They create cultures that unleash originality in others.

 

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Books, Leadership

Leadership: Connections And Disconnections

Leadership BS: Fixing Workplaces and Careers One Truth at a Time by Jeffrey Pfeffer is one of the best books I’ve read on leadership. This book is one for your bookshelf. Below is an excerpt from the book.

 

CONNECTIONS AND DISCONNECTIONSLeadership bs.jpg

The problem with leadership is at its core a story of disconnections:

  • the disconnect between what leaders say and what they do;
  • the disconnect between the leadership industry’s prescriptions and the reality of many leaders’ behaviors and traits;
  • the disconnect between the multidimensional nature of leadership performance and the simple, noncontingent answers so many people seek;
  • the disconnect between how the leadership industry is evaluated (happy sheets that tap inspiration and satisfaction) and the actual consequences of leader failures (miserable work-places and career derailments);
  • the disconnect between leader performance and behavior and the consequences those leaders face;
  • the disconnect between what most people seem to want (good news, nice stories, emotional uplift) and what they need (the truth);
  • the disconnect between what would make workplaces better and organizations more effective, and the base rate with which such prescriptions get implemented.

 

And there are even more disconnects-such as the disconnect between the leadership industry and the leaders whom that industry serves, and the disconnect between the people who bear the consequences of leader behavior and the leadership industry’s manifest and many failing.

Framed in this way, the remedy for the many leadership failures seems simple, and it is: to restore the broken connections, the linkages between behavior and its consequences, words and actions, prescriptions and reality.

But this task will not be easy. The disconnections serve many powerful interests, and they serve those interests extremely well. The leadership industry rolls along, profiting from the disconnect between its prescriptions and what gets done, a disconnection that means not only problems remain but also the business opportunities from speaking, writing, blogging, and so forth about those problems. Leaders love the disconnect that leaves them unaccountable for the workplaces they mess up and their poor performance and bad behavior. And worst of all, lots of people are complicit in the disconnect between the reality that exists and what they would prefer to believe and the stories they want to and often pay to hear.

It is possible to restore at least some of these connections, some of the time. One way to begin might be to reconnect with the real world. One of the important but troubling phenomena that occur in organizations of all types is that the higher you rise, the more that people will tell you how smart and right you are, and the less connection you will have to the realities of organizational life. So good leaders seek to keep themselves grounded in the realities of what they are doing and, more important, why they are doing it.

When Rudy Crew was in the process of being forced from his position as chancellor of New York City’s schools by that other Rudy, Rudy Giuliani — who, no surprise, has also written a book on leadership — Crew decided he needed to reconnect with the essential reality of why he was doing what he was doing, a reality embodied in the one million children in New York’s schools, many of whom could not read at grade level. These children looked like a young version of himself and represented the reason Rudy Crew went into education in the first place. So Crew decided to go to a school.

As Crew told the story to a class I taught, he went into a classroom, maybe it was second or third grade, and there was an African American child working on a math problem. He was not having a lot of success, as after he did the problem, the eraser would come out and the kid would rub out the answer and start over. Crew came up to the boy and asked him what he was doing and how it was going. The child replied that he was doing math and having trouble doing it. “Keep at it, you’ll get it,” said Crew.

As Crew and those accompanying him were preparing to leave that classroom a while later, the child came up to Crew and asked, “Mister, who are you?” Crew replied that he was the chancellor, the person in charge of all of the city’s schools. “Wow,” said the boy, “you’re the man.” And then, in the way
that only small children can, with complete openness and lack of malice, the kid asked Crew, “Are you any good at your job?” “Some days I think I am,” Crew replied, “and some days I’m not so sure.” The pupil looked up at Crew, smiled, and said, “Well, just keep at it. You’ll get it.”

I am not sure what will make a difference in the leadership crises that cost leaders their careers and provide too many employees with enervating work environments. But I am quite sure what will not work: more of the same inspiring sentiments based neither in the social science research about human behavior nor in the facts about the state of play in the leadership industry. In the end, people can handle the truth, and the sooner they confront those truths, the better off everyone will be. And until then, everyone, not just leaders, but everyone, will have to keep working away, until we get it.

 

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Blogs

HBR: 5 Strategy Questions Every Leader Should Make Time For

Below is a blog post from Harvard Business Review. Are you taking time out of your busy schedule to strategize? It requires substantial periods of careful, undisturbed reflection and consideration. Leadership is not just about doing things, it’s also about thinking. Make time for it!

5 Strategy Questions Every Leader Should Make Time For

Have you ever noticed that when you ask someone in your company, “How are you?” they are more likely to answer “Busy!” than “Very well, thank you”? That is because the norm in most companies is that you are supposed to be very busy – or otherwise at least pretend to be – because otherwise you can’t be all that important. The answers “I am not up to much” and “I have some time on my hands, actually” are not going to do much for your internal status and career.

However, that you are very busy all the time is actually a bit of problem when you are in charge of your company or unit’s strategy, and responsible for organizing it. Because it means that you don’t have much time to think and reflect. And thinking is in fact quite an important activity when it comes to assessing and developing a strategy.

The CEO of a large, global bank once told me: “It is very easy for someone in my position to be very busy all the time. There is always another meeting you really have to attend, and you can fly somewhere else pretty much every other day. However, I feel that that is not what I am paid to do. It is my job to carefully think about our strategy.”

I believe his view is spot-on. And there are other successful business leaders who understand the value of making time to think. Bill Gates, for example, was famous for taking a week off twice a year – spent in a secret waterfront cottage – just to think and reflect deeply about Microsoft and its future without any interruption. Similarly, Warren Buffett has said, “I insist on a lot of time being spent, almost every day, to just sit and think.”

If you can’t find time to think, it probably means that you haven’t organized your firm, unit, or team very well, and you are busy putting out little fires all the time. It also means that you are at risk of leading your company astray.

As famous management professor Henry Mintzberg has described, much of strategy is “emergent.” It is often not the result of a strategic plan just being implemented, but driven by opportunistic responses to unexpected events. Stuff happens. Companies often engage in new activities – customers, markets, products, and business models – serendipitously, in response to external events and lucky breaks. But this also means that business leaders need to make ample time to reflect on the configuration that has emerged. They need to systematically analyze and carefully think it through, and make adjustments where necessary.

Many leaders don’t make that time – at least not enough of it.

If you are in charge of an organization, force yourself to have regular and long stretches of uninterrupted time just to think things through. When you do so – and you should – here are five guiding questions that could help you reflect on the big picture.

  1. What does not fit? Ask yourself, of the various activities and businesses that you have moved into, do they make sense together? Individually, each of them may seem attractive, but can you explain why they would work well together; why the sum is greater than the parts?

As the late Steve Jobs explained to Apple’s employees when he axed a seemingly attractive business line, “Although micro-cosmically it made sense, macro-cosmically it didn’t add up.” If you can’t explain how the sum is greater than the parts, re-assess its components.

  1. What would an outsider do? Firms often suffer from legacy products, projects, or beliefs. Things they do or deliberately have not done. Some of them can be the result of what in Organization Theory we call “escalation of commitment.” We have committed to something, and determinedly fought for it – and perhaps for all the right reasons – but now that things have changed and it no longer makes sense, we may still be inclined to persist. A good question to ask yourself is “what would other, external people do, if they found themselves in charge of this company?”

Intel’s Andy Grove called it “the revolving door” when discussing strategy with then-CEO Gordon Moore; let’s pretend we are outsiders coming new to the job, ask ourselves what they would do, and then do it ourselves. It led Intel to withdraw from the business of memory chips, and focus on microprocessors. This resulted in more than a decade of 30 percent annual growth in revenue and 40 percent increase in net income.

  1. Is my organization consistent with my strategy? In 1990, Al West, the founder and CEO of SEI – the wealth management company that, at the time, was worth $195 million – found himself in a hospital bed for three months after a skiing accident. With not much more to do than stare at the ceiling and reflect on his company’s present and future, he realized that although they had declared innovation to be key in their strategy, the underlying organizational architecture was wholly unsuited for the job. When he went back to work, he slashed bureaucracy, implemented a team structure, and abandoned many company rules. The company started growing rapidly and is now worth about $8 billion.

As a consequence of his involuntary thinking time, West did what all business leaders should do: he asked himself whether the way his company was set up was ideal for its strategic aspirations. What would your organization look like if you could design it from scratch?

  1. Do I understand why we do it this way? When I am getting to know a new firm, for instance because I am writing a case study on them, I make it a habit to not only find out how they do things but also explicitly ask why. Why do you do it this way? You’d be surprised how often I get the answer “that’s how we have always done it” [while shrugging shoulders] and “everybody in our industry does it this way.”

The problem is that if you can’t even explain why your own company does it this way, I am quite unconvinced that it could not be done better. For example, when more than a decade ago I worked with a large British newspaper company, I asked why their papers were so big. Their answer was “all quality newspapers are big; customers would not want it any other way.” A few years later, a rival company – the Independent – halved the size of its newspaper, and saw a surge in circulation. Subsequently, many competitors followed, to similar effect. Yes, customers did want it. Later, I found out that the practice of large newspapers had begun in London, in 1712, because the English government started taxing newspapers by the number of pages they printed — the publishers responded by printing their stories on so-called broadsheets to minimize the number of sheets required.  This tax law was abolished in 1855 but newspapers just continued printing on the impractically large sheets of paper.

Many practices and habits are like that; they once started for perfectly good reasons but then companies just continued doing it that way, even when circumstances changed. Take time to think it through, and ask yourself: Do I really understand why we (still) do it this way? If you can’t answer this question, I am pretty sure it can be done better.

  1. What might be the long-term consequences? The final question to ask yourself, when carefully reflecting on your company’s strategy and organization, is what could possibly be the long-term consequences of your key strategic actions. Often we judge things by their short-term results, since these are most salient, and if they look good, persist in our course of action. However, for many strategic actions, the long-term effects may be different.

Consider a practice adopted by many of the UK’s IVF clinics – of selecting only relatively easy patients to treat, in order to boost short-term success rates (measured in terms of number of births resulting from the treatment). The practice seems to make commercial sense, because it (initially) makes a clinic look good in the industry’s “League Table.” But, as my research with Mihaela Stan from University College London showed, it backfires in the long run because it deprives an organization of valuable learning opportunities which in the long run leads to a lower relative success rate.

When you start a new strategy or practice it is of course impossible to measure such long-term consequences ex-ante, however, you can think them through. For instance, when we asked various medical professionals in these clinics what might be the benefits of treating difficult patients, they could understand and articulate the learning effects very well. They could not measure them, but with some careful thought they could understand the potential long-term consequences before even engaging in the strategic action. Actions often have different effects in the short and long run. Sit down and think them through.

Strategy, by definition, is about making complex decisions under uncertainty, with substantive, long-term consequences. Therefore, it requires substantial periods of careful, undisturbed reflection and consideration. Don’t just accept the situation and business constellation you have arrived at. Leadership is not just about doing things, it is also about thinking. Make time for it.

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