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How Successful Leaders See Into The Future

How many times have you expressed frustration at your inability to have a clear view of the future in your organisation? It’s so obvious that things need to be done differently — but we are unable to see what the future holds.


There are several factors that block our view of the future. Some factors are to do with the way we think about risk and uncertainty. And others are related to the way our human brain functions.


Here are four practices that can assist you to see through these blockers and give you a better view of the emerging future.


1. Treat uncertainty as your friend

Generally, we view uncertainty and its bedfellow risk, as something negative. It is seen as something that can upend our carefully laid plans. In this way, we view it as an equation — the probability of something occurring to prevent us from achieving our plan.

But uncertainty is also a space — a space in which opportunity exists for creation and innovation.

Understanding the key uncertainties in your environment is the key to recognising the ways in which the future may unfold. We know that most of the future depends on the way that these uncertainties play out and interact.

So, instead of treating them as the key risks to your strategy, it makes sense to embrace them in your thinking and planning for the future.

And doing so recognises that risks emanate from uncertainty.


2. Embrace risk in your strategy

By embracing uncertainty (risk) into our strategy, we implicitly recognise that there are several ways in which the future can unfold. These alternative futures are generally referred to as future scenarios.

The future scenarios are constructed by identifying your two key uncertainties and representing them as two axes, and then using them to construct a model with four alternative cells.

graph

Each cell represents an alternative future scenario, and they represent 4 ways in which the future can unfold. You now have a view of the future that takes into account the key uncertainties in the environment.


For example, assume that you manufacture a product used in building construction, and that your major market is to export into the USA. You identify that the exchange rate (which affects your price in the US market) and the level of activity in the US construction sector (size of the market) are your major uncertainties.



Your scenario model might look something like this:

graph

So we now have four scenarios with very different market dynamics — each with a particular set of challenges.


You now understand the range of futures you can face and begin planning for these. 


Two key insights emerge from including uncertainty into your thinking about the future:

  1. You face multiple futures as you look forward in your strategy
  2. Instead of attempting to predict the future, a better approach is to define those capabilities necessary for success in each of the four scenarios. Thereafter, you can begin to build and develop those capabilities that are common across all four scenarios.


3. Use examples from other sectors to build new analogies 

Our lack of memory about the future is another factor blocking our future vision. This may sound strange, but our memory plays an important part in making sense of what we see and how we make decisions. This so-called semantic memory helps to create the structures whereby we interpret what we see — and is largely formed by our educational, cultural and social environment.


If our memory lacks this knowledge and structure, we may not see and understand the picture (of the future) that is unfolding in front of us.


This is where studying examples from other sectors and industries becomes useful. However, the purpose is not to use these examples as benchmarks and seek to copy them.


By studying examples from other sectors, you will create new cognitive pathways and classification systems — thereby increasing your ways of “knowing” and considering new possibilities. These alternative “mental models” can help you to see and consider a different future.


4. Separate planning and strategy activities

The term “strategy planning” is a strange term, since it combines two quite different concepts and approaches. And it causes people to believe that planning and strategy are interchangeable. They are not.


A plan is not a strategy.


Strategy is a creative and learning process whereby we seek to explore connections and associations in a non-linear way. We are seeking new insights into a challenge or a problem. This requires deep inward reflection and an opportunity to “retreat” from an action-orientation.


Planning, on the other hand, is a linear and methodical approach whereby we apply logic and best practice to achieve an efficient pathway to an objective. Unlike strategy, it requires external focus and attention to detail.


In practice, it works best if you have a separate session for strategy — the exploration of the information, challenge or problem. The purpose of the strategy session is to learn all you can about the situation and then agree on how the problem can be framed.


Once the problem has been framed, a separate planning session can the focus on the actions steps that need to be taken to address the problem or challenge.


We know that action is often the enemy of thought. The planning process, with its emphasis on action and doing things, will often push aside the reflection and insight required for strategic thinking. 


Seeing into the future

The ability to see into the future requires that we take the time to do things a little differently:

  • Slow down.
  • View uncertainty as a shaper of the future.
  • Build an understanding of practices in other sectors and industries.
  • Create time for reflective insight by separating strategy from planning.

About Norman


Dr Norman Chorn is a highly experienced business strategist, future thinker and author helping people lead and build strong and successful organisations in times of change. Well known to many as the ‘business doctor’! By integrating the principles of neuroscience with strategy and economics Norman achieves innovative approaches to achieve peak performance within organisations.


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By Norman Chorn 27 Mar, 2023
In my previous article "Accelerate Performance with Strategic Alignment - Define the logic of your strategy", we demonstrated the alignment between the market and business strategy by matching the logic of the market with the logic of the strategy. The Explore logic emphasises a market where customers seek new solutions for emerging requirements. The strategy responds by exploring new opportunities and driving for growth. The Exploit logic occurs in a more stable market where customers seek lower costs and reliability of supply. The appropriate strategy focuses on operational efficiency and building close customer relationships. Culture is key to shaping the capabilities of the business to successfully implement strategy . It drives the way that people behave, decisions are made and actions are taken. It determines, therefore, the strategy that is actually realised in the market, as opposed to that which is merely intended. We make a key distinction between the desired culture and the appropriate culture. The desired culture is what people may choose because it sounds attractive and in vogue. However, the appropriate culture is the culture that is required to successfully implement the chosen strategy. Often, these can be different. For example, people might seek to develop a culture that is ‘innovative’, ‘flexible’ and ‘empowering’, but this may not be the appropriate culture needed to successfully implement the business strategy. DEVELOP THE APPROPRIATE CULTURE FOR YOUR STRATEGY Developing the appropriate culture requires a deliberate emphasis on certain cultural attributes and making trade-offs on others. As we will see, the attributes that are traded off are usually the opposites of those that are emphasised.
2 puzzle pieces
By Norman Chorn 27 Mar, 2023
In Part 1 "How to Accelerate Performance with Strategic Alignment - Understand the Logic of the Market" we outlined different market conditions and defined them in terms of two overarching logics — Exploring and Exploiting . To briefly recap, an Exploring logic is one where customers are seeking new solutions for emerging needs. It’s all about change and action. An Exploiting logic occurs in a more stable market in which the issues are about lowering costs and working collaboratively with customers. It’s a market that focuses on stability and cohesion. FORCES THAT SHAPE YOUR STRATEGY Clearly, it is one of these two logics — or a combination of both — that will shape your strategy as you operate in these markets. See figure 1 below that describes how these logics will form your business strategy:
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