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The Strategic Thinker
Gaining an edge in business requires an unprecedented level of strategic thinking. Here’s where you fit in.
FROM: MAR-APR 2007 ISSUE | BY LAURA PRATT
It was a pitch-perfect day in June 2004 when Teresa Cascioli, then the owner and CEO of Lakeport Brewing Corp., put the finishing flourishes on a management buyout deal that would make her the majority owner of her then five-year-old Hamilton, Ontario-based brewery. A year later, she took the company public. “This was not by accident,” says Cascioli, who was selected by the Women’s Executive Network for Canada’s Most Powerful Women Top 100 Award for 2006 in the entrepreneurs category. “This was all about strategic thinking.”
It’s a subject that’s got the business world in a tizzy of late, as companies awaken to its importance and work to understand what it’s all about. “I personally don’t think anybody knows what the words mean,” says Alan Kennedy, who has taught strategic management at the Schulich Executive Education Centre at York University in Toronto since 1992. “As much as there has been more writing and thinking about strategy lately, I still think ‘strategic business thinking’ sounds pretty threatening to most people.”
Beyond Problem Solving
The essential aversion, he believes, lies in people’s misinterpretation of the concept as problem solving. The critical difference is that the latter focuses on the known, and the former on the unknown. Strategy, Kennedy says, is about connecting the world you can’t control with the world you can. A strategic thinker, then, is concentrating on linking such uncontrollable matters as competition, customers, industry trends, and the regulatory environment, to such controllable matters as corporate course of action, business model, marketing efforts, financial management, and human resources.
The second trick to mastering strategic thinking, Kennedy says, is understanding its roots in expectations. It is only an awareness of those projects you’re tasked to complete that makes strategy tangible. “Strategy gets implemented by [appreciating] the activities you’re responsible for.”
A business owner might, for example, decide to grow the company through a strategy of acquisition. This creates an expectation of whomever else is involved in its implementation around specific activities such as identifying what to buy, how to pay for it, and how to purchase it. “So one simple strategy choice that turned into a simple strategy plan has spawned a huge number of expectations that drive how that strategy is implemented,” Kennedy says.
“Clearly there is a disconnect between what we are doing in the workplace and what we should be doing. We’re not talking enough about what the expectations are and how they connect to the activities.”
Richard T. Gorham, president of Leadership-Tools.com, an online leadership resource based in La Grande, Oregon, agrees, adding that thinking strategically means determining how to get from point A to point B with a process that can not only be visualized, but also has the potential to be developed and implemented. “It’s one thing to imagine it,” he says, “but you need to consider the next thing: who’s going to put it in place?”
Clarity and communication need to take centre stage when making strategic thinking a priority at your organization. “I tell my managers, ‘the more difficult conversations you have – and you must be willing to have them – the fewer you will have to have.’” After all, he points out, the vast majority of people want to do a good job. They want to be successful and they want to meet the expectations of their manager. But they’ve got to know what’s expected of them.
The Key Questions
At his firm, John Leishman tackles strategic thinking by asking questions. The first question for this chief executive at Geeks on the Way, a Calgary-based computer support company, is: what metric are you going to use to evaluate your success? Next you need to understand what resources you have at your disposal to begin answering the questions that follow.
Initially, says Leishman, his company struggled with how to differentiate itself in the marketplace. Next, it was with how to make its booking, administrative, and accounting procedures as efficient as possible. More recently, it’s the question of how to expand beyond Western Canada that’s occupying the brains of senior management at this five-year-old firm.
“We asked ourselves a lot of questions for this one,” he says. “Like, if we were calling a service company, what are some of the things we would and wouldn’t like?”
Discovering the answers to these inquiries was itself a strategic endeavour. At least once a month, Leishman trots himself over to a nearby coffee shop, turns his cellphone off, and devotes half a day to strategic thought. He takes stock of the last 30 days and makes notes on successes and failures which he saves in a folder called strategy. Sometimes he’ll keep articles from the various business publications to which he subscribes that include tactics he thinks might find application within his own shop. This kind of activity, says Leishman, is critical to the new definition of success in the corporate world. “Everyone works in their business,” he says, “not on their business.”
Predicting the Future
In the past, says Alex Lowy, a Toronto-based independent strategist who teaches critical thinking and strategic problem-solving at the Schulich Executive Education Centre, a strategic planning function was a more obvious part of the business model than it is today. It was easier to predict the future in the 1970s, he points out, when the marketplace didn’t have as many influences working on it. Organizations, if they were large enough, actually nominated staffers expressly to handle strategic planning. “But in the 1980s, this function fell apart,” he says. “Everything started going a little wild, the influences on businesses became more dynamic, and you were no longer in control of what your customers and competitors knew.”
At this point, says Lowy, the need to learn and adapt became the number-one strategy. “And you can’t do that if you have an investment in a single view about the future.” What’s more, the notion of assigning an individual or a group the role of strategic planning suddenly seemed absurd. “They do it in a way that’s out of touch with what else is going on. They are planners, after all, and aren’t involved in the business.”
But strategic thinking, says Lowy, is more important than ever. Faced with insanely competitive environments that are rife with change, businesses need to revisit challenges constantly. “The only way you can do that is by staying open-minded, and by integrating what’s going on externally in your market and internally inside your organization.”
This new reality highlights the imperative for solid leadership. “It’s an exciting time for managers, a time when, by staying in touch and being ready to adapt, there are tremendous opportunities about.” Leaders, says Lowy, need to be lifting their gaze from a focus on technical and operational requirements, to one that includes the bigger picture. He believes the best corporate strategists act as a filter for others in the organization, a difficult task which requires the interaction of a very complex set of cognitive and emotional skills.
Making it happen, says Lowy, begins with awareness. “Ask a lot of questions, look at what’s going on outside your firm and in, and be an integrator. Accept learning as your number-one priority. If you’re being a strategic thinker, you’re not just thinking about facts, dollars, and cents. You’re also thinking about human factors. You’re having to pay attention to signs that are not always going to be found on a balance sheet.”
If all of this is news to you, take heart. The concept of strategic thinking, says Schulich’s Kennedy, is still a relatively new one. Indeed, it wasn’t even introduced until 1954, when an Austrian-born business thinker made mention of it in a book called The Practice of Management. “So this is not a 3,000-year-old discipline,” says Kennedy. “This is a 50-year-old discipline. It explains why people don’t really seem to know what they’re talking about, forgives a lot of wrongs, and it also makes us focus on continuing the hunt.”
Back at Lakeport, recently renamed Lakeport Brewing Income Fund, chair and CEO Cascioli sums up her approach to strategic thinking: “It’s a little bit like playing chess,” she says. “It means constantly considering the future as the present is happening. You have to always be forward-thinking your next move.”
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How to be a Savvy Strategist
Expertise in financial management puts you in a key position to craft strategic approaches to everything from big-picture business expansion activities to highly refined accounting practices. Try these tips to boost your strategizing skills:
1. Remove yourself regularly from the office.
Devote a few hours to pure strategizing away from the day-to-day diversions of corporate minutiae. Set a specific goal for each session, like four solid tasks you can follow through on.
2. Keep your sightlines high.
If you anticipate imminent corporate growth, overhire. That avoids the last-minute scramble for human resources personnel.
3. Establish a system for tracking your ideas.
Keep it organized and up to date. “By keeping my files in good order I can leverage the information that passes by me so that some time in the future I’m not starting from scratch,” says Richard T. Gorham, president of Leadership-Tools.com, an online leadership resource. “I’m taking what I’ve learned every time and strategically leveraging that for future opportunities.”
4. Be methodical.
Don’t just look at the expectations your strategy creates, take it one step further by breaking them into four categories: financial, customer, employee, and process. Being this specific makes the plan more manageable. |
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Laura Pratt is a Toronto-based freelance writer.