Too often we see that the organization has lack of knowledge in strategic management and what strategy is. Strategic competence is also absent on board level, much more than one should expect.
To claim that the top management and the board of directors is treating strategy in every board meeting, is off-course only a way of telling that you don’t have any strategy and that the company is just floating on the river without any particular control.
Still we wonder why companies goes bankrupt and lose market share.
Strategic leadership doesn’t come easily in most organizations. Statistics show that fewer than 10% of leaders exhibit strategic skills, a woefully inadequate number considering the demands on organizations today.
Especially in hard time with recession strategic skills are needed and not only in times of growth. For the last 15 years I have been in several turnaround cases where the strategic skills and understanding of strategy has been essential for the success of the turnaround case. During tough times, when resources are tight, it is even more important to ensure those resources are focused in the right areas. Especially we saw this in a turnaround case of a Nordic Business Process Outsourcing player some years ago, when we closed down its operations in Norway and moved the productions offshore.
Leaders throughout organizations face tremendous pressures to make short-term numbers and show immediate wins. Operational leadership rules the day. This can lead to a lack of focus–as one senior executive recently told me, “we discuss strategic directions in each board meeting”, with other words the company is just running fast in many different directions with no specific or clear strategic vision. Leaders who excel at meeting short-term targets and solving functional problems may feel paralyzed and unsure when the challenges in front of them are far reaching and complex–a situation we’ve seen consistently in these recession years.
How do we lead in ways that position a business for the future while meeting current demands? My contention is that it demands a different set of skills from operational leadership. Strategic leadership requires us to think, act and influence others in ways that promote the enduring success of the organization.
First, strategic thinking is grounded in a strong understanding of the complex relationship between the organization and its environment. It requires taking a broad view, involving the right people, with important information and perspectives, asking probing questions and facilitating conversations. Strategic thinkers then identify connections, patterns and key issues. To boost the level of strategic thinking as you or your team work on a challenge, pose these questions:
–What external or industry data are important for my analysis of and response to the challenge?
–Why is it important that we succeed with this challenge?
–How does this challenge (and my solution and approach) relate to issues and challenges elsewhere in the organization?
–Who are the key stakeholders? What data do they have (opinions, needs, experiences, perspectives, etc.) that are relevant to the challenge and to my response?
–In what ways do my own experiences and biases limit my view of the situation?
–How can I reframe the challenge and see it from different angles?
–What single factor, if acted on, would create the greatest leverage on the result?
Next, strategic acting involves taking decisive action that is consistent with the strategic direction of the organization–despite all ambiguity, complexity and chaos. A strategic plan is only a plan; an organization’s actual strategies lie in the decisions and choices people make.
Strategic leaders act in ways that manage the tension between success in daily tasks and success in the long term. They facilitate other’s strategic actions, too, by providing a balance of direction and autonomy, of learning from actions and rewarding appropriate risk-taking. Questions to help you and your team evaluate the strategic consistency of your actions include:
–How is my response consistent with the overall direction of the organization? Are there ways in which it is inconsistent with that direction?
–What, if anything, is keeping me from settling on a solution or approach? How much more information do I need so that I can make the decision in a timely way, even if I am not totally comfortable yet?
–What are the risks in this solution? What contingency plans can I put in place?
–What are the most critical priority areas for me or us to focus on? Am I sending any mixed signals about those priorities?
–Assuming that implementation will not be perfect, what can I do to create an environment where unexpected results are treated as learning opportunities rather than failures?
Finally, strategic influencing is about building commitment to the organization’s strategic direction by inviting others into the strategic process, forging relationships inside and outside the organization, and navigating the political landscape.
To effectively influence others, leaders must understand the impact that they have on them. They should also understand the needs, styles and motivations of others. To apply strategic influencing skills to a challenge, ask yourself:
–What will it look like if I succeed? What is my vision?
–Who else needs to be on board to make this successful? How will this solution or approach help (or hinder) the achievement of their goals and objectives?
–Are there other organizational systems, processes or structures that need to be in alignment to facilitate that change? What do I need to do to create that alignment?
–Are there any stories I can use when talking to others that illustrate how we need to behave and will inspire others to do so?
–How willing am I to let my vision be shaped by others’ visions?
–Who might I solicit to help me champion my efforts? How can I get them on board?
–What political realities might affect my success in this challenge? How might I navigate those realities without limiting my credibility?
Ultimately, strategic leadership is both an organizational and a personal process, and it is one that today’s businesses cannot afford to ignore. The job of strategy is not limited to a few top executives. Strategic leaders are needed throughout our organizations if they are to adapt, innovate and succeed well into the future.