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Growth strategy | Advisory | Force multiplier

Leadership

Survival of the Most Adaptable

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“It is not the strongest of the species that survive, nor the most intelligent, but the ones who are most responsive to change.” – Charles Darwin

You often hear Charles Darwin’s theory of evolution, first published in his book On the Origin of Species in 1859, summarized as “survival of the fittest.” It turns out this is not exactly the correct interpretation.

In reality, Darwin actually meant survival of the most adaptable to change.

This concept of adaptability applies perfectly to today’s chaotic VUCA environment. I believe those organizations (and leaders) who are best able to adapt to change will grow and thrive. Those who don’t, won’t!

VUCA is the New Normal

Let’s face it, 2020 has been one wild rollercoaster of a ride. Across industries, the global pandemic has accelerated many changes that were already in motion, and created a number of new ones.

This unprecedented pace of change and disruption is only going to continue. This new VUCA (volatile, uncertain, complex, ambiguous) environment is here to stay.

As a result, leaders of organizations have a simple choice to make:

  • Will they stand by and hope for things to revert?
  • Or, will they choose to adapt to the new environment?

When you step back and think about it, the correct answer is obvious.

Things are very unlikely to return to where they were. Ever.

The world has changed. As a result, leaders and their teams need to adapt. Quickly.

Adaptability is the Key to Survival and Growth

The key to survival and growth in times of disruption is your mindset, your preparation, and your willingness to embrace change.

Leaders, organizations, and industries who are operating in survival mode are in deep trouble. When survival instincts prevent movement from the status quo, then extinction is near.

Those leaders, and their teams, who are adaptable and operate with an empowered, strategic, and future-focused way of thinking will win. The ability to be flexible, make quick decisions, and then take action will help them out-wit, out-play, and out-last their competitors. This is the key to survival and growth in a VUCA world.

Leaders and their teams need to get out of the building. They must be ever vigilant, always prepared to act quickly and decisively when confronted with moments of need or opportunity, adversity or change.

VUCA Strategic Planning is Your Secret Weapon

Any battle-hardened leader will tell you that no plan survives its first contact with the market! Therefore, it is wise to have a robust, yet flexible, approach when making plans for the future.

The VUCA Strategic Planning framework provides a disciplined approach to planning and achieving the Envisioned Future of the organization, while maintaining flexibility the ability to pivot quickly when VUCA strikes.

We do not always see it immediately, but disruptions also bring opportunity. We need to be observant and open to the possibility. Be calm and clearheaded enough to recognize it and react appropriately.

Strategic organizations and brave leaders are even willing to disrupt themselves!

To win in a disruptive VUCA environment, you must win in your mind first! This begins with preparation, and a comprehensive strategic plan.

To survive and thrive, high performing leaders and their teams:

  • Know their purpose, their why.
  • Understand their long-term goals. Their what.
  • Know how they need to work together. Their strategy. Their how.
  • Have connection. Share common core values.
  • Have robust situational awareness, considering both internal and external perspectives and market forces.
  • Have a comprehensive plan. Everyone on the team has a role to play.
  • Have considered and planned for alternative scenarios. Leaders are constantly asking “what if?…”
  • Maintain an active strategy portfolio in case the primary one fails.
  • Actively manage the execution of the plan to monitor progress, control resources, and have the ability to make quick course-corrections.

Conclusion – Adapt or Risk Failure

This is both an exciting and nerve-wracking time to be a business leader.

Regardless of your industry, or the size of your organization, today’s business climate is chaotic, fluid, and changing rapidly. Every leader and their team will have a unique set of problems to solve and challenges to overcome, requiring new ways of thinking and different tactics than the past.

As our new VUCA world continues to unfold, I believe there will be unlimited opportunity to grow and thrive for those organizations who are best able to adapt.

I encourage all leaders and organizations to embrace change and build adaptability as a core competancy.

-Onward

Getting From Vision to Results

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“A vision and strategy aren’t enough. The long-term key to success is execution. Each day. Every day.” – Richard M Kovacevich

After developing a VUCA Strategic Plan for their organization, many leaders and their teams think the hard work is over.

Unfortunately, this is not the case. This is when the real work begins!

It is now time to transition the focus from planning to execution. This is when the work of accomplishing the objectives defined in the plan happens. This is where winning organizations demonstrate a bias to action and MFGSD, and begin to execute their plans.

The Management Cycle is the final, and arguably most important, element in the VUCA Strategic Planning framework. For leaders, this is the vital process whereby they effectively manage the execution of the VUCA Strategic Plan for their organization. For individuals and teams, this is when they execute strategy and tactics all the way through to the achievement of defined objectives.

The VUCA Strategic Planning Management Cycle

A comprehensive VUCA Strategic Plan will have clearly articulated details on three important elements:

  1. Long-term goals for the organization.
  2. The strategy for reaching them.
  3. Tactical objectives to achieve along the way.

Furthermore, these objectives (hopefully designed using the SMARTER framework!) will specify assigned resources (people and financial), timelines, and metrics.

The tactical objectives are the work outcomes which are delegated to individuals and teams, and help to define the success or failure of their roles in the organization.

Leaders of the organizations (who are the fiduciary “owners” of the strategic plan) must now do what they do best: lead their teams and manage the plan to successful completion! This element, called the Management Cycle in the VUCA Strategic Planning framework, is where the work of the organization happens.

The Management Cycle is not a static step in the planning process, but actually an on-going management activity. Rather than a linear path from beginning to end, it is better to think of it as a circular loop structured very much like the traditional PDCA total quality productivity loop (plan-do-check-act), as follows:

  • Start/Continue – Think of this as a stage-gate at the top of the loop. It is where the work effort towards achieving the objective begins. It is also where leaders make the decision to continue the effort during a regular progress update…
  • Action/Execution – This is the stage where the actual work or activity happens. At some pre-defined, or ad hoc, point in time the activity is reviewed…
  • Evaluation – In this stage, individuals or teams review their progress with leadership. Specific metrics (defined in the VUCA Plan) are evaluated, which leads to…
  • React/Pivot/Stop – Following evaluation, leaders must guide the individual or team in making any necessary course corrections. This can include reacting to things like market feedback, experiment results, sales success, etc. The decision could be to continue for another execution cycle, pivoting to a different approach, or stopping the activity.

This iterative pattern of activity continues until the objective is either successfully achieved, or the objective is modified, or the objective is removed from the plan.

The cadence of the Management Cycle is heavily dependent on the nature of the actual activity. Singular events, or short-duration tactical activities, might not allow time for anything other than a completion/failure evaluation at the end. Whereas, longer-term or more complex activities might have a series of regularly scheduled reviews on some calendar basis (daily, weekly, monthly, quarterly, etc.)

Many leading organizations (including Intel, Google, and LinkedIn) have enjoyed great success using a methodology called Objectives and Key Results (sometimes referred to as OKR) to manage the execution of their strategic plans. Future blog articles will go into greater depth on the OKR framework for managing the achievement of objectives.

Where Does the Management Cycle Fit into the VUCA Strategic Planning Framework?

In the VUCA Strategic Planning framework, Core Ideology and Envisioned Future, combined with robust Situational Awareness detailing the current state of the organization and its operating environment, create the springboard for strategy development:

  • Core Ideology – Defining the mission, values, and purpose of the organization. These elements describe why the organization exists and what it stands for today. They form the “true North” guideposts for making strategic decisions and are the foundation for any VUCA plan.
  • Envisioned Future – Defining a clear vision of what the organization aspires to become or achieve and its long-term goals. These elements explain the desired “future state” and the long-term goals you and your team are working towards achieving in order to get there.
  • Situational Awareness – A thorough analysis of the environment in which the organization operates. Situational awareness involves knowing where you are (“current state”) and being aware of what is happening in your environment (internal and external perspective) to better understand how information, events, and one’s own actions might affect both immediate and future outcomes.

With this planning foundation in place, leaders should consider strategic options that will enable the organization to bridge the gap between the current state and the desired future state while factoring in the operating environment as revealed by the situational analysis. Strategy is the mechanism to do this:

  • Strategy – Defining the approach that will guide individuals and teams on “how” to achieve the short-term objectives that move the organization from its starting point towards achieving its long-term goals. Strategy plays a vital role in VUCA strategic planning. It bridges the “gap” between where the organization is today and where it wants to be in the future.
  • Strategy Decision – Once formulated, leaders must then decide if the strategy is the best one to help the organization achieve its long-term goals. If the decision is to move ahead with executing a chosen strategy then it is time to commit, and proceed with creating a complete Strategic Plan around that strategy designed to ensure successful execution.

The strategic planning process culminates in the creation of a VUCA Strategic Plan:

  • VUCA Strategic Plan – A clear time and resource based plan, that details the strategy and actions by which the organization intends to reach its Envisioned Future.

In addition to their primary VUCA Strategic Plan, leadership teams should also take several additional steps to help mitigate the potential risk of disruption or failure:

  • Scenario Planning – Identify the potential VUCA impacts that could derail your primary strategy or impede your ability to achieve the defined objectives, and action plan your response to them. Because almost no plan goes as expected, by answering “what if” across a comprehensive set of possible future scenarios your team will be better prepared to quickly react and make decisions when a disruption happens.
  • Strategy Portfolio – A list of viable alternative, complementary, or even competing strategies that your organization will resource and your team will execute in addition to the primary strategy. Your Strategy Portfolio will develop from the strategy formulation phase, additional insights gained from situational awareness, and scenario planning that went into creating your VUCA Plan. This element mitigates risk and maximizes future opportunity for the organization.

In the final stage of the VUCA strategic planning process the focus shifts from planning to execution. It is now time for leaders to delegate the responsibility for taking action and manage the outcomes.

  • Management Cycle – A circular workflow, where individuals or teams do the work of executing the strategic plan, review progress, and make course-correction decisions. The leaders of the organization manage this on a regular cadence until the objectives are either achieved, changed, or deleted.

Conclusion – Time to Execute

“Without strategy, execution is aimless. Without execution, strategy is useless.” – Morris Chang

In the world of business, having great ideas is much like having a strategic plan – many leaders and organizations have them, yet very few successfully get them done.

This failure to execute is what the Management Cycle element of the VUCA Strategic Planning framework prevents. By clearly defining expectations and ownership, and actively managing the work, leaders can make sure good outcomes happen.

Moving the organization from vision to results…

-Onward

A Bias to Action (MFGSD!)

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“Plans are only good intentions unless they immediately degenerate into hard work” —Peter Drucker

For much of my career I have focused on helping organizations grow. This focus on growth has allowed me to sit at the interesting intersection of strategy, innovation, marketing, sales, and customer success in a number of leadership roles across a few industries.

With the benefit of this experience and perspective, I can clearly see that there are two consistent ingredients required for success: Strategy and execution.

I have written extensively about how important it is for organizations to develop agile and flexible strategic plans designed to achieve long-term goals in a hostile VUCA business environment.

However, a plan by itself is useless. There is something even more important to success than having a plan. What could that ingredient be?

A bias to action.

Most Plans Just Gather Dust

Despite the enormous investment of time and resources that leaders of organizations put into developing their strategic plans for the future, most fail. Why?

There are many common reasons why organizations don’t achieve the results they define in their strategic plans. These can include a bad strategy, flawed situational awareness, unrealistic goals, unforeseen (VUCA!) scenarios, weak teams, and even poor leadership. However, by far the biggest culprit is bad or non-existent execution.

Strategy without execution is a complete waste of time.

Business leaders know that nothing good happens in business until someone does something. The alternative to this proactive approach is simply to wait for the universe (or your competitors) to take action. In my experience, this reactive approach never ends up well. Unfortunately, too many people wait for things to happen instead of proactively making them happen. With this approach, you don’t make forward progress. You don’t learn anything.

Mary Kay Ash, they dynamic founder of Mary Kay Cosmetics said it best: “There are four kinds of people in this world: Those who make things happen, those who watch things happen, those who wonder what happened, and those who don’t know that anything happened!”

A bias to action is what makes things happen.

Focus on Execution

A common ingredient to every successful startup or highly functioning executive team that I’ve been involved with in my career has been a simple operating philosophy that I like to call “Move Fast and Get S#!T Done.” Over the years I’ve shortened it and made it a little more politically correct by referring to it by the acronym: “MFGSD”.

It boils down to a laser-like focus on execution.

Effective leaders make sure their teams know the vision and strategy of the strategic plan, ensure they have the support and resources they need to execute, and then get out of the way.

MFGSD!

How do you create this bias for action? It starts with effective leadership and developing your team. The goal is to move your people up what I call the “action ladder”:

  • Level 0 – Ignorant of opportunity or threat, therefore no action
  • Level 1 – Can identify there is an opportunity or threat
  • Level 2 – Proposes a viable solution for opportunity or threat
  • Level 3 – Can develop a plan of action to address opportunity or threat
  • Level 4 – Can develop a plan of action for opportunity or threat, and it is feasible
  • Level 5 – Solving the opportunity or threat by executing the plan of action

If you have ever had a “star” employee on your team, you will recognize how valuable (and rare!) Level 5 players are. They make sure important things get done.

Most execution problems are easy to fix. Start with your people. You have two basic options: Get the people in your organization motivated to perform at a higher level than they are today, or get higher-level people into your organization.

Go Forth, MFGSD!

The late Herb Kelleher, co-founder and former CEO of Southwest Airlines, said something that in my opinion perfectly sums up the concept of being strategic, having a bias to action and the MFGSD ethos: “We have a strategic plan. It’s called doing things.”

The important lesson for leaders – there is a very long list of things in the world you cannot control. Execution is not one of them. You can control your actions.

Pick a direction. Create a plan. Execute. React to what you learn. Keep going.

MFGSD!

That’s it. A very simple concept, and extremely powerful if you (and your team) practice it.

-Onward

Disrupt Your Organization Today!

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“Innovation is the ability to see change as an opportunity – not a threat.” – Steve Jobs

In January 2020, the World Economic Forum published a survey revealing the top five predicted major risks for economic disruption this year:

1. Extreme weather
2. Climate action failure
3. Major natural disasters
4. Biodiversity loss
5. Human made environmental damage

With the benefit of hindsight, it is now terribly obvious that they might have forgotten one!

We are just past the halfway mark of 2020, and have to acknowledge that a global pandemic can do an unbelievably effective job of disrupting pretty much everything and bringing the world to a near standstill. In just a few months, we’ve witnessed unprecedented challenges to our global supply chains, along with economic and social disruption across every industry.

Despite all this negativity, I’m beginning to think there might be something positive in it as well. For those leaders who are paying attention and willing to do some hard work, now is an excellent time to be thinking about how to innovate and transform your organization for the future.

In effect, disrupt your organization before someone (or something) does it for you.

Be the Fire and Wish For the Wind

Disrupting your organization is not an easy concept to embrace. It is a bit like cutting off the proverbial limb you are sitting on!

The opening section of the exceptional book, Antifragile: Things That Gain from Disorder by Nassim Nicholas Taleb, is titled “How to love the wind.” It begins by comparing our desire for stability to that of a candle. We want to protect the candle’s flame from the wind, to prevent it from being extinguished. Yet, a fire uses the same wind to fan its flames and grow stronger in the process.

“Wind extinguishes a candle and energizes fire.”

He then makes an analogy to VUCA forces, “Likewise with randomness, uncertainty, chaos; you want to use them, not hide from them. You want to be the fire and wish for the wind. This summarizes this author’s non-meek attitude to randomness and uncertainty.”

So what is the takeaway?

The immediate, pragmatic, and safe response to getting hit with a crisis like the global pandemic, is to protect the candle. Our natural inclination is to save ourselves, our loved ones, our organizations, from the overwhelming risk and danger.

However, the VUCA forces in the environment are not going away. Not today. Not ever. If anything, they are only going to become stronger. Therefore, it makes logical sense to embrace the uncertainty and volatility, to make it the new telescope that we view the world through, and use it to sharpen our strategic plans for the future of the organization.

Embracing Change

In the business world, change is the only constant.

Strategic leaders must be receptive to change. Look for it. Embrace it.

Whether it is AI and machine learning, or robotics, or the gig economy, or the pandemic…almost every organization in every industry faces severely disruptive, if not existential, threats every day.

The dynamic forces of free markets don’t grant immunity to any individual, or any organization. Therefore, the best solution is to embrace it.

Here is a great data point that demonstrate the level of market disruption, churning, and creative destruction in the global economy: Only 52 of the original Fortune 500 companies are still in existence today. Driven by technology, innovative new business models, and VUCA market forces nearly 9 out of every 10 Fortune 500 companies that were on the list in 1955 are gone, merged, or contracted.

If you need some extra motivation, here’s a great example from recent business history: Kodak.

Kodak was at one time the dominant global provider of camera film, photo paper, and cameras with over a 90% market share. Then complacency (and a healthy dose of corporate hubris) set it. Their leadership refused to acknowledge the existential threat of digital photography. After seeking bankruptcy protection in 2012, the company has had to go down a long and painful road of reinventing itself in the face of the digital revolution. Today it is a mere shell of its former self.

The kicker to this story? Kodak actually invented the digital camera in 1975 but did not commercialize it out of fear of cannibalizing their core business. Ouch!

Strategic Suggestions

Are you a leader of an organization facing disruption from marketplace competitors and contemplating the potential impact of VUCA forces in your business environment?

Here are a few strategic suggestions for how best to navigate through it:

  • Focus on the customer. At the end of the day, if you don’t have a customer, then you don’t have a business. Therefore, it makes a lot of sense to listen to them. Understand their needs, wants, desires. Get to know customers so well that you can begin to anticipate the future and provide them what they don’t even know they need, want, or desire yet!
  • Study the market. Markets for every industry are crowded and complex. Technology innovation is only making it more cloudy and confusing for buyers and sellers in the ecosystem. The solution is two-fold: Get crystal clarity on your ideal client, so that you truly understand their wants and needs. Then, you need to nail your positioning and value proposition so that your organization is so clearly differentiated that only you can provide the solution they need.
  • Think like a startup. Startups usually begin with nothing but an idea. They have no clients or products to protect. No corporate hierarchy or political backstabbing to battle. Just a blank sheet of paper and a passion for developing something new or improved, and then bringing it to the market. This mindset, and way of working, is something that established organizations would benefit from.
  • Question everything. This suggestion is closely related to the previous bullet on thinking like a startup. Many organizations are not willing to revisit their business models, operating assumptions, or other “sacred cows.” This myopic thinking creates huge strategic blind spots. The answer? Be inquisitive. Question everything. Don’t assume history will repeat, or that you know all the answers. Most big companies are often good at fostering “sustaining” innovations – ones that incrementally improve their positions in established markets – yet they are incapable of dealing with innovations that completely disrupt those very same markets. Why? They are too focused on protecting what they have today, instead of building something new for tomorrow. A bird in the hand is worth two in the bush!
  • Open communication channels. To enable the suggestions listed above you need to make sure you have open, honest, and collaborative communications channels across your organization. This is not only vital for establishing robust Situational Awareness, but also for making sure you have a diverse set of ideas and experiences to consider in your strategic decision-making.Don’t stop with just listening to your customers. Listen to your prospects. Listen to your employees. Listen to your partners. Listen to your critics. Not everything they say will be accurate, or strategically relevant, but the truth is always in the middle – some of it will be useful!
  • Build resilience. I’ve written before that I think many organizations are guilty of “swimming naked”, or over-optimizing their businesses, thereby reducing their ability to quickly pivot and change direction when confronted with adversity. The pandemic crisis has exposed just how fragile many supply chains and manufacturing processes are, and the vulnerability of huge global industries like airlines, retail, and hospitality to VUCA shocks. Leaders should seek to build more resilience into their organizations, which could manifest itself in many ways: flexible workforce, more technology, redundancy, better analytics, extra inventory, etc.
  • Become more agile. This global crisis should inspire more leaders to re-think the balance between efficiency and the need for resilience. Those leaders, and organizations, who embrace the VUCA Strategic planning process, will gain agility. By thinking through and planning for alternative scenarios, and taking a portfolio approach to managing the organization, they will be able to act quickly, and decisively, when confronted with new disruptions.

The Time to Act is Now

This is a perilous and uncertain time for business leaders. We are truly in uncharted waters. We know that most industries are likely going to experience significant fundamental changes as we emerge from the initial tactical responses to the pandemic. We also know that organizations will need to change their strategies to prepare for the new environment.

However, most won’t act. Why?

Most organizations don’t innovate very well or attempt to disrupt their own business. Driven by the desire to show the public markets consistent quarterly growth they are trapped in the historical way of doing business and searching for “safe” incremental gains.

There are a few notable exceptions to this type of thinking: Amazon, Alphabet (Google), and Tesla come to mind. They have mastered a delicate balance to optimize for maximizing short-term gains, while also building strength and resiliency, and innovating to capture long-term growth and profit from new markets.

In times past, leaders would be very reluctant to shift their direction or strategy out of fear of alienating the market, or shareholders, or employees. Ironically, the unprecedented current level of VUCA uncertainty and fear in the global economy has given leaders a huge and rare gift. It is not quite a clean slate, but it is a once-in-a-lifetime opportunity to make transformational changes with less risk.

Most organizations, regardless of their industry or current strategy, will likely find themselves in a new industry structure and competitive landscape post-pandemic. If they don’t make significant adjustments today, they will likely lose market share to more agile competitors. They will also find themselves with even fewer strategic options in the future as shareholders seek to recoup losses and workers move on to organizations with better growth opportunities.

Strategic leaders should consider that the best use of their limited time and organizational resources might not be in fixing the current business, but rather inventing the future one. By leveraging some of the suggestions above, strategic leaders will listen carefully to the market, build resiliency and agility, and develop new strategies.

Even though now is the perfect time to disrupt your organization and begin a transformation, most leaders won’t dare to do it.

That’s a huge missed opportunity. Perhaps a fatal one…

Conclusion

Although the timing is still uncertain, I have confidence that the public/private partnership will be successful, and that we will find successful treatments and a vaccine for COVID-19. When this pandemic crisis is over, I believe we will witness one of the greatest periods of innovation and business acceleration in the history of humankind.

This means that right now, today, is a once-in-a-lifetime opportunity for progressive leaders to take a step backwards, pause, and think about how their organization should transform in order to be better positioned in the future.

Seek out the opportunities to disrupt and disintermediate your organization in the market. When you find them, embrace them, and figure out how to make them part of your VUCA Strategic Plan.

If you don’t take these steps and act with some urgency, then some other company likely will. In fact, they are probably already making plans to do so…

-Onward

Making the Strategy Decision

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“The inability to make decisions is one of the principal reasons executives fail. Deficiency in decision making ability ranks much higher than lack of specific knowledge or technical know-how as an indicator of leadership failure.” – John C. Maxwell

Leaders and their teams must make strategic decisions throughout the VUCA Strategic Planning process. Aside from the ultimate “go/no-go” execution decision, perhaps no decision is more important that the one made after a strategy has been formulated: Is it the right strategy to help the organization achieve its long-term goals, and should a strategic plan be created in order to execute the chosen strategy?

Decision-Making Defined

In psychology, decision-making is defined as a cognitive process, which results in the selection of a belief or a course of action among several possible alternative options. In a business context, decision-making is the process of identifying and evaluating alternatives to pick one best option based on the knowledge, experience, values, preferences and beliefs of the decision-maker. 

Research suggests that each of us make thousands of decisions every day, many of them sub-consciously. These decisions range from the mundane, which generally do not require much thought (for example, “White shirt or blue shirt?” or, “Do I want another cup of coffee?”) to the more complex (ex. “Should I look for a new job?” or, “Where do I want to live?”) which can be significantly more difficult to decide.

It is the same with organizations. Leaders and their teams are making decisions every day and at every level. Decision-making within the organization can range from routine operational decisions, to more complex managerial decisions, all the way up to challenging strategic decisions, which can shape the future trajectory of the organization.

The Peril of Making Strategic Decisions

The most important and difficult decisions – the strategic decisions with significant consequences for the performance of the team or the future success and viability of the organization – carry the most risk for leaders. Strategic decisions call for a thoughtful approach.

Strategic decisions are risky, and never easy. They often cause leaders the most angst because they are decisions that are both high in potential impact, but also high in terms of investment of scarce company resources. Furthermore, strategic decisions are not transactional (like a consumer selecting a box of cereal at the grocery store) but instead are complex and dynamic situations where the leader can influence the outcome by how they lead and manage the team. Adding even more complexity, their organization is likely competing with others – where picking the right strategy and doing better than rivals could mean the difference between winning and losing, between growth and bankruptcy. Adding in the additional uncertainty of a VUCA (volatile, uncertain, complex, ambiguous) environment just intensifies the risk.

This means strategic decision-makers need two vital, yet often contradictory skills: clear analysis, and the ability to take swift and bold action in the face of uncertainty.

Great Leaders are Decisive

Great leaders are decisive – they understand how to balance emotion with logic, and then effectively make decisions that positively impact their organizations and all their constituents.

Making good strategic decisions in challenging situations is always difficult because these types of decisions involve change, uncertainty, anxiety, stress, and sometimes the unfavorable or less than enthusiastic reactions of others.

Great leaders also have great situational awareness – they instinctively know when to move quickly and proceed with decision-making using whatever information is available, versus when they need to take more time and gather additional information.

Avoiding Paralysis by Analysis

Uncertainty creates an uncomfortable decision-making platform for leaders, and can lead to a phenomenon called analysis paralysis.

This is a common dynamic where decision-makers try to eliminate the uncertainty they are facing by over-analyzing the situation. Often to no avail.

The challenge with delaying a decision in order to gather more information is knowing when to stop. Many leaders mistakenly believe you cannot have too much information, but data gathering takes time and having too much data to consider can be paralyzing, and a distraction from taking a big picture view or focusing on the most important data points.

The reality is most decisions, especially the strategic ones, are made with less than perfect information. The pressure of trying to craft strategy that overcomes the uncertainty caused by a VUCA environment just ends up wasting valuable time and energy – scarce resources better spent on planning and execution.

Getting to Done

Effective strategic decision-making has another vital element: It is not just about selecting the alternative that best satisfies the business objective, it is also about making sure it is something that is implemented and actually gets done.

An unfortunate by-product of focusing too hard (and too long!) on selecting the ideal option is neglecting the opportunity cost of not taking action sooner.

Scott McNealy, co-founder of Sun Microsystems and its CEO for 22 years, was asked how he made difficult decisions and responded by saying, “It’s important to make good decisions. But I spend much less time and energy worrying about ‘making the right decision’ and much more time and energy ensuring that any decision I make turns out right.”

Merely deciding on the “best” option does not guarantee a successful outcome, just as making a poor choice does not necessarily doom the initiative to failure. It is what happens next, which determines your success.

As the immortal management theorist, Peter Drucker said, “Unless a decision has ‘degenerated into work’, it is not a decision. It is at best a good intention.”

This is the connection of decision-making into the VUCA Strategic Planning framework.

Where Does Decision Making Fit into VUCA Strategic Planning?

As a quick refresher, the Core Ideology of the organization is the planning filter that any strategy will be evaluated against, and the Envisioned Future is the definition for the desired future state. When combined with robust Situational Awareness, detailing the current state of the organization and its operating environment, your Core Ideology and Envisioned Future create the springboard for strategy development. Previous articles have described these three planning elements in detail:

  • Core Ideology – defining the mission, values, and purpose of the organization. These elements describe why the organization exists and what it stands for. They form the “true North” guideposts for making strategic decisions and are the foundation for any VUCA plan.
  • Envisioned Future – defining a clear vision of what the organization aspires to become or achieve and your long-term goals. These elements explain the desired “future state” of the organization, and the long-term goals you and your team are working towards achieving in order to get there.
  • Situational Awareness – a thorough analysis of the environment in which the organization operates. Situational awareness involves knowing where you are (“current state”) and being aware of what is happening in your environment (internal and external perspective), in order to better understand how information, events, and one’s own actions will impact both immediate and future outcomes.

With this solid planning foundation, leaders are ready to consider strategic options that will enable the organization to bridge the gap between the current state and the desired future state while factoring in the operating environment as revealed by the Situational analysis. This is where strategy comes into play:

  • Strategy – defining the approach that will guide individuals and teams on “how” to achieve the short-term objectives that move the organization from its starting point towards achieving its long-term goals. Strategy plays a vital role in VUCA strategic planning. It is quite literally the vehicle that will help the organization bridge the “gap” between where it is today (its current state) and where it wants to be in the future (desired future state).

Formulating strategy is not easy. Unfortunately, for leaders it only signals the beginning of the next phase of the VUCA Strategic Planning process – making a strategy decision:

  • Strategy Decision – once a strategy has been formulated, leaders face a significant decision: Is it the right strategy to help the organization achieve its long-term goals? If the decision is to move ahead with executing a chosen strategy then it is time to commit, and proceed with creating a complete Strategic Plan designed to ensure the successful execution of it.

Basic 5-step Decision Making Process

Making the strategy selection decision can be simplified by following a proven 5-step process:

  1. Identify the decision: The first step in making the best decision for the organization is to recognize the problem or opportunity, and decide to address it. At this stage in the VUCA Strategic Planning process, that should be straightforward to answer! Clearly, the objective is to pick a strategy.
  2. Gather information: Next, you want to gather the information you need in order to make a decision based on facts and data. If you’ve been following the VUCA Strategic Planning framework so far, this should also be in your hands at this point. You and your team will have gained solid Situational Awareness of the salient factors present in your operating environment. The Core Ideology and Envisioned Future of the organization should provide the context you need to make a decision.
  3. Identify alternatives: As part of the strategy formulation process, your team likely identified several potentially viable alternative strategies with one emerging as the preferred approach. By identifying these potential alternatives, you are ready for the next step.
  4. Weigh the evidence:In this step, you need to evaluate the feasibility, acceptability, and desirability of each alternative option. There are many sophisticated techniques to do this, but the simplest is just to consider the pros and cons of each option. Which leads us to the final step.
  5. Choose among alternatives:In this final step, you want to choose the strategy option that has the highest probability of success. When it is time to make your decision, be sure that you understand the risks involved with your chosen strategy. Sometimes a new strategy will emerge at this stage, formed by combining elements of alternative strategies.

Criteria for Evaluating Your Strategy Decision

Once you have selected your strategy, it is a good idea to do a quick evaluation before proceeding. Here are some key elements to consider:

  1. Core Ideology: The chosen strategy does not contradict the Mission and Values of the organization, and supports or enables your Purpose.
  2. Situational Awareness: You have clarity on the starting position (current state), and have considered all of the environmental (internal and external) factors that could influence the successful execution of the chosen strategy.
  3. Envisioned Future: You (and your team) still believe in the long-term goal (future state) for the organization, and that it can be achieved, or enabled by, the successful execution of the strategy.
  4. Diagnosis: The diagnosis of the challenge is reasonable, and you can defend it. This is the logical and fact-based explanation for the reason(s) behind the challenge that the organization is facing.
  5. Hypothesis: A clear and simple hypothesis on the solution to the challenge, one that the strategy could reasonably be expected to solve.
  6. Bias: A cognitive bias is a type of error in thinking that can affect our decision-making and judgement. There are many to consider, but you obviously want to avoid them when choosing your preferred strategy.

These elements provide helpful criteria for leaders to use when evaluating any considered strategy.

If, and only if, these conditions are satisfied, then you are in a good position to make the final decision and proceed with developing a VUCA Plan.

Next Steps

Once a leader has made the strategic decision on strategy, it is time to make the decision tangible by developing a plan that details the execution of the strategy leading to the achievement of your defined objective(s).

Upcoming articles will cover the details of creating a VUCA Strategic Plan, the importance of scenario analysis in strategic planning, and the value of taking a portfolio approach to managing your strategic initiatives.

-Onward