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“the soft stuff is [really]
              the hard stuff”
some thoughts on Strategy, Innovation & more...




                                 rodney
                                     buitendag
                               created jan 2010
                              updated nov 2011
strategyparadox
MichaelRaynor




      The Board should not evaluate the CEO based on the company’s performance, but instead on the firm’s strategic risk profile
The CEO should not drive results, but manage uncertainty
                                            Business unit leaders should not focus on execution, but on making strategic choices
Line managers should not worry about strategic risk, but devote themselves to delivering on commitments

Most strategies are built on specific beliefs about the future.
Unfortunately, the future is deeply unpredictable. Worse, the requirements of breakthrough
success demand implementing strategy in ways that make it impossible to adapt should the
future not turn out as expected. The result is the Strategy Paradox: strategies with the
greatest possibility of success also have the greatest possibility of failure
Resolving this paradox requires a new                way of thinking about strategy and uncertainty.
The Future of Management
Gary Hamel with Bill Breen




                             Through history, management
                                   innovation has enabled
                                 companies to cross new
                               performance thresholds
                                    and build enduring
                                            advantages.
                               The management paradigm
                              of the last century - centered
                              on control and efficiency - no
                                  longer suffices in a world
                                    where adaptability and
                                 creativity drive business
                                    success. To thrive in the
                                    future, companies must
                             reinvent management
One of my Honours courses was                     “To create a pervasive culture of
entrepreneurship. I’ll never       innovation you must first create an environment
forget the insightful discovery      of performance and motivation. Achieving
that I made doing research for a
                                           this is often, paradoxically, the result of less
project. Almost without fail,
successful (and seriously
                                   effort rather than harder work. Although goals and
                                     performance targets are useful tools, they can also
wealthy) entrepreneurs, did not     have a detrimental impact on results. When people
set out to make money per se...            are future fixated, their creativity and overall
Money was not the goal, but to            performance diminish. Find the sweet spot of
do something that they were                    optimal performance, and you will
passionate about really well.          undoubtedly see an increase in employee
The lesson for me was to focus                      productivity, creativity, and
less on what I want to achieve,                     satisfaction…all with less effort.”
and more on the things that may
lead to the outcomes that I
desire.
- rodney



                             theperformanceparadox
                                                            StephenShapiro
priorities!focus
Tom Peters used to remind
executives that it mattered little
what they proclaimed to be their
top priorities. Instead, the "In
Search of Excellence" co-author
advised looking at your calendar
to reveal your main concerns,
because that is where you are
spending your time.

For that matter, why not also
look at your meetings? Analyse
the minutes and calculate the %
items that are strategic vs
operational.
Also consider how many items
are actually the responsibility of
people lower down in the
organisation? No problem
getting one’s hands dirty now
and then, but how do we
empower staff if we take on
their work?
we’re all so very
                    busy... but are we
Not only the
right things, but
at the right
                     doing the right
levels of work?
As individuals,
                         things?
and as an
organisation, are
we effective?
putting (some of) the pieces together
So you might wonder where              What are the burning
I’m going with this...            issues in our organisation
                                   and what are our leaders
When the pressure’s on, we         saying but not all doing...
focus on what we know and         Mostly People Issues, the
what we do well. Strategy                  soft stuff, not so?
must be executed, results
delivered, shareholders kept      After all, it’s the collective
happy... So we focus on all        of the People working for
these things that we need to       the organisation who are
achieve: our goals and              going to make achieving
objectives, bonuses and                the goals, the results,
incentives. Share Price.                               possible.
Outcomes.
                                    All of us are faced with
With all this going on it’s too      uncertainty, paradox,
easy to forget about the things          contradiction, and
we need to do to achieve those    complex problems almost
outcomes, the supporting                               daily.
initiatives, the co-producers,
the enablers...                        What are the tools, the
                                      capabilities, the “not so
The People.                               obvious” that we as
                                     individuals and us as an
The Change that is invariably           organisation need to
being introduced into the           focus on in order to deal
system.                                    with these issues?
Future                Levels
              Studies                 of
  Organisational                    Work          Talent
   Learning &                                   Management
  Development

                            Sustainability –
                           social, economic
 Systems
                           & environmental
 Thinking
      Change
    Management
 Leadership        Performance                 Innovation
                   Management
a few essential tools/capabilities/concepts to navigate in a
disruptive age [not exhaustive, but top of mind for me]
the “outcome-enabler” matrix
After thinking about the concepts on the previous slide long and
hard, it occurred to me that if we make a list of issues, we
typically list everything without necessarily analysing the
relationships between the items. In the same list would be our
goals/outcomes as well as resource issues and possibly
enablers for both of the aforementioned.


I came up with the idea of a
matrix to plot
issues/initiatives/ projects
according to the degree
which the benefits are easy
to quantify in financial terms
and the degree to which
they are people related.
Resources produce the
results (or outcomes) but
are supported by Enablers.
“outcome-enabler” example
Below is an example of how this could work, of course this should
be the outcome of a group process to identify relevant issues and
potential enablers. This is merely to illustrate the concept,
although I do also believe that regardless of the resource issues
and outcomes, the enablers that I’ve listed are “enduring” and
fundamental.
                                                On the slides that
                                                follow I will
                                                briefly touch on
                                                some of the
                                                enablers, but note
                                                that each is an
                                                extensive
                                                discipline in its
                                                own right and most
                                                of them are inter-
                                                dependant at some
                                                level. This is but
                                                a snippet of the
                                                whole story...
sustainability
it’s more than just the
environment – also
economic and social
procurement
practices, employment
practices
more than reporting on
carbon
footprint, recycling etc
it should be integral to
strategy and intrinsic in
what we do, personally
!nnovation               The IBM Institute for Business Value recently
                         explored the future of insurance: “Insurance 2020:
                         Innovating beyond old models,” provides insight into
                         the question of why insurance appears to be a
                         lethargic industry in the use of innovation. This
  “Innovation and        study shows that insurers focus on the optimization
                         of products and processes and accept it as though it
 entrepreneurship        were innovation. However, the power of innovation
                         does not come simply from the use of a specific
  have to become         technology to overcome a problem, but from the
                         willingness to try something different.
  an integral, life-
                         It is worth repeating over and over: we believe
sustaining activity      innovation is the key to future success for insurance.
                         In the insurance industry, modifications of existing
            in our       products advertised as “new” were deemed
                         sufficient.
organizations, our       As we move forward in time toward 2020, this
                         situation will no longer be the case. Customers will
     economy, our        know what they want and do not want – the
          society.”      insurer that does not innovate
                         soon will not be ready in time for
    Peter F. Drucker,    inevitable change.
        Innovation and
      Entrepreneurship   IBM - Insurance 2020
                         Now what? Exploring initiatives for innovation
corporateforesight



This a concept that I came across only recently and that requires more
research. Z_Punkt defines it as “translating trend and future
research into the real world of innovation and strategic
management”.
This further illustrates my earlier statement about enablers being inter-
dependent. We cannot, for example, simply focus on Innovation in
isolation – what are the requirements for Innovation to flourish and
produce results, does it form part of some other “bigger picture”?
diversity
     Tom Peters blogging on the importance of Diversity for
                                  Innovation (Nov 2009)
Diversity Per Se. Sine Qua Non.
•   Diversity/Every flavor/Management & Measurement.
    Diversity with a lower-case "d."
    Black, white, brown, purple ... tall, short ... North
    American, Asian ... public school, private school, no
    school ... etc. ... etc. (Etc.) Decision-making of every sort
    is far, far better with diverse views of any flavor. Period. I
    have come to view this as a gamechanger - for a 6-
    person project team, a 20-person company, a huge
    enterprise.
•   Diversity/Hiring. Search every oddball corner of the world
    for interesting people. Hire dull, get dull results. (Duh.)
                                                                       Diversity is not a
    (This holds across the board - and irrespective of the size
    of the enterprise.)
                                                                      race/culture issue,
•   Diversity/Freak Acquisitions. I'm an enemy of 99% of
    mega-mergers, and a vigorous ally of small acquisitions
                                                                         people are
    that allow skipping steps in obtaining interesting new
    pieces of the puzzle for an enterprise. This can be the
                                                                           diverse -
    purchase of an intriguing 2-person accountancy by a 15-
    person accountancy, as well as a small-acquisition overall
                                                                     personality, attitude,
    strategy by the likes of Cisco Systems.                            thoughts, mental
•   Diversity/Promoting. Diversity of every stripe at every
    level, achieved by design. Remember, diversity-qua-                   models, etc
    diversity works.
Tom Peters ranting about talent...




 We pay ever more lip-service to “people-power”, even as we
 cling to our long-standing penchant for hiring and cultivating
     obedient “employees”. We say that we take “talent”
seriously, while failing to transform our organisations in a way
            that makes them truly talent-attractants.
concept:       Organisational Learning
                                                                           Peter Senge

                                   The Five Disciplines of Organizational
                                                                Learning
                                     Personal Mastery | Mental Models
                                          Shared Vision | Team Learning
                                                        Systems Thinking
                                          http://www.solonline.org/organizational_overview/


Peter Senge speaks about organisation culture (notes from an audio clip)
• Practices - define an organisation, visible aspects of org culture
• Values -> there’s what we say (espoused) and what we do, “unquestioned deep
  assumptions”
• Learning in order to be a deep phenomena must transform organisational culture, must
  lead people to recognise their unquestioned assumptions
• Learning is about letting culture evolve so that you can achieve what you didn’t before
• Learning & cultural change are always connected

To make Org Effectiveness a “reality”, we need to undergo “transformational change”
• Transformational Change a process that shifts us inside as well as out
• Inter-twines personal, team & organisation, even industry
• It’s about deep, systemic change – what’s most systemic is what’s most personal
• The “system” (organisation) evolves as a result of how people think
• It’s a process where we have to question taken-for-granted assumptions/mental models
• A process of reflection, questioning, of challenging ourselves and challenging the way we
   do things
systems thinking




Most of us have heard of the Butterfly Effect referred to in Chaos Theory – how
a small change in one part of a system can trigger a massive change elsewhere.
Business is a complex system and Systems Thinking can help us “learn to better
understand interdependency and change, and thereby to deal more effectively
with the forces that shape the consequences of our actions.”
“It is based upon a growing body of theory about the behavior of feedback and
complexity - the innate tendencies of a system that lead to growth or stability
over time.”
Peter Senge
a sample transformation “system”
    (based on a “complex project” I was a part of once)




Systems thinking in action...
purpose of this
   presentation
Organisational
Effectiveness demands
change, change depends on
learning, learning depends
on challenging our current
state, and so on...
If all I achieve with this
presentation is to raise
awareness of some things
that we are either not doing
at all, or things that we are
doing but can do better,
then I’d feel that I’ve
achieved something.
We need to start intelligent
and meaningful
conversations about how we
can “up” the “enablers” to
produce results.

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On strategy innovation & more

  • 1. “the soft stuff is [really] the hard stuff” some thoughts on Strategy, Innovation & more... rodney buitendag created jan 2010 updated nov 2011
  • 2. strategyparadox MichaelRaynor The Board should not evaluate the CEO based on the company’s performance, but instead on the firm’s strategic risk profile The CEO should not drive results, but manage uncertainty Business unit leaders should not focus on execution, but on making strategic choices Line managers should not worry about strategic risk, but devote themselves to delivering on commitments Most strategies are built on specific beliefs about the future. Unfortunately, the future is deeply unpredictable. Worse, the requirements of breakthrough success demand implementing strategy in ways that make it impossible to adapt should the future not turn out as expected. The result is the Strategy Paradox: strategies with the greatest possibility of success also have the greatest possibility of failure Resolving this paradox requires a new way of thinking about strategy and uncertainty.
  • 3. The Future of Management Gary Hamel with Bill Breen Through history, management innovation has enabled companies to cross new performance thresholds and build enduring advantages. The management paradigm of the last century - centered on control and efficiency - no longer suffices in a world where adaptability and creativity drive business success. To thrive in the future, companies must reinvent management
  • 4. One of my Honours courses was “To create a pervasive culture of entrepreneurship. I’ll never innovation you must first create an environment forget the insightful discovery of performance and motivation. Achieving that I made doing research for a this is often, paradoxically, the result of less project. Almost without fail, successful (and seriously effort rather than harder work. Although goals and performance targets are useful tools, they can also wealthy) entrepreneurs, did not have a detrimental impact on results. When people set out to make money per se... are future fixated, their creativity and overall Money was not the goal, but to performance diminish. Find the sweet spot of do something that they were optimal performance, and you will passionate about really well. undoubtedly see an increase in employee The lesson for me was to focus productivity, creativity, and less on what I want to achieve, satisfaction…all with less effort.” and more on the things that may lead to the outcomes that I desire. - rodney theperformanceparadox StephenShapiro
  • 5. priorities!focus Tom Peters used to remind executives that it mattered little what they proclaimed to be their top priorities. Instead, the "In Search of Excellence" co-author advised looking at your calendar to reveal your main concerns, because that is where you are spending your time. For that matter, why not also look at your meetings? Analyse the minutes and calculate the % items that are strategic vs operational. Also consider how many items are actually the responsibility of people lower down in the organisation? No problem getting one’s hands dirty now and then, but how do we empower staff if we take on their work?
  • 6. we’re all so very busy... but are we Not only the right things, but at the right doing the right levels of work? As individuals, things? and as an organisation, are we effective?
  • 7. putting (some of) the pieces together So you might wonder where What are the burning I’m going with this... issues in our organisation and what are our leaders When the pressure’s on, we saying but not all doing... focus on what we know and Mostly People Issues, the what we do well. Strategy soft stuff, not so? must be executed, results delivered, shareholders kept After all, it’s the collective happy... So we focus on all of the People working for these things that we need to the organisation who are achieve: our goals and going to make achieving objectives, bonuses and the goals, the results, incentives. Share Price. possible. Outcomes. All of us are faced with With all this going on it’s too uncertainty, paradox, easy to forget about the things contradiction, and we need to do to achieve those complex problems almost outcomes, the supporting daily. initiatives, the co-producers, the enablers... What are the tools, the capabilities, the “not so The People. obvious” that we as individuals and us as an The Change that is invariably organisation need to being introduced into the focus on in order to deal system. with these issues?
  • 8. Future Levels Studies of Organisational Work Talent Learning & Management Development Sustainability – social, economic Systems & environmental Thinking Change Management Leadership Performance Innovation Management a few essential tools/capabilities/concepts to navigate in a disruptive age [not exhaustive, but top of mind for me]
  • 9. the “outcome-enabler” matrix After thinking about the concepts on the previous slide long and hard, it occurred to me that if we make a list of issues, we typically list everything without necessarily analysing the relationships between the items. In the same list would be our goals/outcomes as well as resource issues and possibly enablers for both of the aforementioned. I came up with the idea of a matrix to plot issues/initiatives/ projects according to the degree which the benefits are easy to quantify in financial terms and the degree to which they are people related. Resources produce the results (or outcomes) but are supported by Enablers.
  • 10. “outcome-enabler” example Below is an example of how this could work, of course this should be the outcome of a group process to identify relevant issues and potential enablers. This is merely to illustrate the concept, although I do also believe that regardless of the resource issues and outcomes, the enablers that I’ve listed are “enduring” and fundamental. On the slides that follow I will briefly touch on some of the enablers, but note that each is an extensive discipline in its own right and most of them are inter- dependant at some level. This is but a snippet of the whole story...
  • 11. sustainability it’s more than just the environment – also economic and social procurement practices, employment practices more than reporting on carbon footprint, recycling etc it should be integral to strategy and intrinsic in what we do, personally
  • 12. !nnovation The IBM Institute for Business Value recently explored the future of insurance: “Insurance 2020: Innovating beyond old models,” provides insight into the question of why insurance appears to be a lethargic industry in the use of innovation. This “Innovation and study shows that insurers focus on the optimization of products and processes and accept it as though it entrepreneurship were innovation. However, the power of innovation does not come simply from the use of a specific have to become technology to overcome a problem, but from the willingness to try something different. an integral, life- It is worth repeating over and over: we believe sustaining activity innovation is the key to future success for insurance. In the insurance industry, modifications of existing in our products advertised as “new” were deemed sufficient. organizations, our As we move forward in time toward 2020, this situation will no longer be the case. Customers will economy, our know what they want and do not want – the society.” insurer that does not innovate soon will not be ready in time for Peter F. Drucker, inevitable change. Innovation and Entrepreneurship IBM - Insurance 2020 Now what? Exploring initiatives for innovation
  • 13. corporateforesight This a concept that I came across only recently and that requires more research. Z_Punkt defines it as “translating trend and future research into the real world of innovation and strategic management”. This further illustrates my earlier statement about enablers being inter- dependent. We cannot, for example, simply focus on Innovation in isolation – what are the requirements for Innovation to flourish and produce results, does it form part of some other “bigger picture”?
  • 14. diversity Tom Peters blogging on the importance of Diversity for Innovation (Nov 2009) Diversity Per Se. Sine Qua Non. • Diversity/Every flavor/Management & Measurement. Diversity with a lower-case "d." Black, white, brown, purple ... tall, short ... North American, Asian ... public school, private school, no school ... etc. ... etc. (Etc.) Decision-making of every sort is far, far better with diverse views of any flavor. Period. I have come to view this as a gamechanger - for a 6- person project team, a 20-person company, a huge enterprise. • Diversity/Hiring. Search every oddball corner of the world for interesting people. Hire dull, get dull results. (Duh.) Diversity is not a (This holds across the board - and irrespective of the size of the enterprise.) race/culture issue, • Diversity/Freak Acquisitions. I'm an enemy of 99% of mega-mergers, and a vigorous ally of small acquisitions people are that allow skipping steps in obtaining interesting new pieces of the puzzle for an enterprise. This can be the diverse - purchase of an intriguing 2-person accountancy by a 15- person accountancy, as well as a small-acquisition overall personality, attitude, strategy by the likes of Cisco Systems. thoughts, mental • Diversity/Promoting. Diversity of every stripe at every level, achieved by design. Remember, diversity-qua- models, etc diversity works.
  • 15. Tom Peters ranting about talent... We pay ever more lip-service to “people-power”, even as we cling to our long-standing penchant for hiring and cultivating obedient “employees”. We say that we take “talent” seriously, while failing to transform our organisations in a way that makes them truly talent-attractants.
  • 16. concept: Organisational Learning Peter Senge The Five Disciplines of Organizational Learning Personal Mastery | Mental Models Shared Vision | Team Learning Systems Thinking http://www.solonline.org/organizational_overview/ Peter Senge speaks about organisation culture (notes from an audio clip) • Practices - define an organisation, visible aspects of org culture • Values -> there’s what we say (espoused) and what we do, “unquestioned deep assumptions” • Learning in order to be a deep phenomena must transform organisational culture, must lead people to recognise their unquestioned assumptions • Learning is about letting culture evolve so that you can achieve what you didn’t before • Learning & cultural change are always connected To make Org Effectiveness a “reality”, we need to undergo “transformational change” • Transformational Change a process that shifts us inside as well as out • Inter-twines personal, team & organisation, even industry • It’s about deep, systemic change – what’s most systemic is what’s most personal • The “system” (organisation) evolves as a result of how people think • It’s a process where we have to question taken-for-granted assumptions/mental models • A process of reflection, questioning, of challenging ourselves and challenging the way we do things
  • 17. systems thinking Most of us have heard of the Butterfly Effect referred to in Chaos Theory – how a small change in one part of a system can trigger a massive change elsewhere. Business is a complex system and Systems Thinking can help us “learn to better understand interdependency and change, and thereby to deal more effectively with the forces that shape the consequences of our actions.” “It is based upon a growing body of theory about the behavior of feedback and complexity - the innate tendencies of a system that lead to growth or stability over time.” Peter Senge
  • 18. a sample transformation “system” (based on a “complex project” I was a part of once) Systems thinking in action...
  • 19. purpose of this presentation Organisational Effectiveness demands change, change depends on learning, learning depends on challenging our current state, and so on... If all I achieve with this presentation is to raise awareness of some things that we are either not doing at all, or things that we are doing but can do better, then I’d feel that I’ve achieved something. We need to start intelligent and meaningful conversations about how we can “up” the “enablers” to produce results.