Interested in more careers-related content? Check out our new weekly Work Life newsletter. Sent every Monday afternoon.
Risks come with everything we do at work. But they are particularly noticeable, and scary, when crafting strategy. All strategy is a risk: The course you choose, the course you don’t choose and the one you currently are on that requires an update or overhaul.
“Risk is the price we pay to make a difference,” entrepreneur and marketing maven Seth Godin writes in his latest book, This is Strategy.
He dismisses the popular phrase, “failure is not an option.” Subscribe to that, he argues, and you have guaranteed failure. The future is unknown, and no project or strategy is risk free. Certainty is elusive and if you need certainty to move forward – since failure is not an acceptable option – you are trapped.
So when you gather to develop a strategy, don’t view it as an opportunity to de-risk work. “The opportunity is to see the risks, understand the game and build our expectations and responses about risk into the project,” he says.
Strategy for organizations involves change, systems, ideas and time, all intertwined. “Strategy is the hard work of choosing what to do today to improve for tomorrow,” he says.
It involves clarifying, simplifying and committing. After addressing that challenge and formulating a strategy, it in turn will create its own challenges you must face. We often hide from strategy because of the difficulties involved. Continuing the existing approach may seem easier. We may not like what we must become if the strategy is successful.
Harvard University’s acclaimed professor of strategy, Michael Porter, has stressed strategy is not a goal. It is also not a list of tasks.
“A strategy is the set of choices we make (and stick with) as we seek to compete,” adds Mr. Godin. “Hard choices are easy to hide from, since choices feel risky. And competition is challenging. It’s easier to have a meeting about our mission statements than it is to get serious about choosing and persisting with a strategy.”
Strategy requires humility because accurately predicting the future is impossible. It also needs to be a flexible plan for meeting the future, not rigid. Strategy’s two key companions, time and systems, are complex. Time resets every day, bringing with it new issues and chances to make decisions. Systems involve the interconnections of multiple people and their interests over time. Strategists have to anticipate and plan for the actions and reactions of other actors within the system.
- Truth: This describes the world as it is – needs and markets that exist, competitors, technology standards and how others have succeeded or failed in the past. The section can be as long as you want and include spreadsheets, market analysis and anything else needed to understand the world you operate within. “We shouldn’t disagree about anything in the truth section,” he says.
- Assertion: This is the heart of your plan. It describes how you intend to change things – the scaffolding you will build and the impact. You will do X and Y will happen. “Of course, this section will be incorrect. You will make assertions that won’t pan out. You’ll miss budgets and deadlines and sales,” he notes.
- Alternatives: Because the assertions will not work out, you need a section that indicates what you will do when that happens. How much flexibility does your team and finances allow? What possible pathways can you anticipate?
- People: Who is on your team and who will join it? He points out this doesn’t mean their resumes but instead their attitudes, abilities, adaptability, resilience and record in getting things done.
- Money: How much will you need and how will you spend it? What will cash flow be like, margins, profit and loss statements and balance sheet? What exit strategy will be available if needed?
- Time: What will be different a week, a month or a year after you launch the initiative? “How will the unseen axis of time inform your planning, so you are leading and not following,” he says.
Strategy inevitably involves delay, which in turn requires trust from everyone. Many great things – from the airplane and early bridges to the latest software – barely worked at the start, he points out. So in your business plan, think about kindling to start your fire. The bigger the logs and the wetter the wood, the more kindling you will need.
Another vital lesson he offers comes from listening to the original recordings of rock stars like Sly Stone, Janis Joplin, Lou Reed and David Bowie. They were doing their best to sound like everybody else – emulate what the system seemed to reward. It might have opened doors for them originally, but it was not the path to stardom. “The big step between musician and rock star is the decision to sound like yourself instead of working to sound like everyone else,” he stresses.
That may seem risky. But strategy is about risk. So is success.
Cannonballs
- It’s common for managers to ask each other how confident they are in a strategic initiative or new project. Consultant Robyn Bolton makes them dig deeper: How much are you willing to bet on the success of this effort? Options are at the high end of your annual income; medium would be dinner for the team at a Michelin-starred restaurant; and low is a cup of coffee.
- Recent research found that long-accepted gender differences tend to correlate with power. For example, giving women more power can cause them to be more assertive and have more positive evaluations of their own abilities. Rotman School of Management PhD candidate Grusha Agarwal notes a woman being denied a promotion because of a lack of assertiveness might change her behaviour when given that new post.
- A key problem with workplace well-being programs is they tend to focus on the individual, not the systems ultimately responsible, three health experts – Jazz Croft, Acacia Parks, and Ashley Whillans – say. Instructing employees to focus on self-care can be seen as hypocritical when employees believe the demands or structure of their jobs, rather than personal issues, are the reason for worsening mental health.
Harvey Schachter is a Kingston-based writer specializing in management issues. He, along with Sheelagh Whittaker, former CEO of both EDS Canada and Cancom, are the authors of When Harvey Didn’t Meet Sheelagh: Emails on Leadership.
