Sunday, December 30, 2007

developing strategic thought

I've been asked by a few organizations lately to help them develop strategic competencies among their staff. Thinking about strategy can be difficult -- thinking about strategic thinking makes my head hurt!

It's hard to talk about developing a muscle you've never used before, or that you have little opportunity to use. For Christmas, I bought my fiance a video game console (a Wii) which includes a tennis game. Alex was very good at tennis while he was growing up, playing at several competitive levels. I've never played tennis, though, and learning to play with him on the video game is extremely frustrating. It's only through repetitive use and practice that I'm starting to get better at it.

Developing strategic thought is much the same way. Most directors and executives are experts at thinking operationally. We've been rewarded all our lives on short-term thinking. Taking the long view is a luxury we don't usually have, and it's easy to get frustrated, because the world is changing so quickly, and how can I hope to predict which direction it will move in?

Whatever our level of experience or competence, we can all build our capacity for strategic thought, just by practice and motivation. We can work on scenario development (to describe changes in the environment) and visioning exercises (to determine how to change the organization to address those changes). Study after study shows that executives and directors who are responsible for strategy are secretly in a panic, unsure of what they're doing, and afraid they'll be found out by their organizations, or that they'll fail from their lack of critical knowledge in this area.

Those of us who are entrepreneurs recognize that strategic thinking is the tool which can give us significant competitive advantage. Those of us who work for large corporations express frustration that we are "stuck" doing tactical work, when we want a chance to lead at a higher level.

Beckhard and Pritchard said, way back in 1992:

A paradox of today's world is the increasing need for leadership to become involved with creating an organization that is actively moving towards its potential while, at the same time, solving todays crisis or emergency. Since often the 'urgent drives out the important,' the organization's 'becoming' is forced to wait its turn. It is our contention that organizations wishing to be top competitors in the years ahead must move the effort 'to become' to the head of the line.


The best way to develop strategic competencies is to help you learn how to use that muscle within a non-profit organization you care about. We can help set directions for our organizations -- where are we headed, why, and how will we get there? How can we change our organization to make it valuable both to its external environment and to itself, leading to sustainable organizational success? Non-profits, almost without exception, all need help with strategic planning. What better way to learn than working your way through it with a supportive group who desperately needs your help?

Of course, just having motivation isn't the whole answer -- strategic planning, as a discipline, has grown up a lot, and tying execution to strategy is not just a possibility, but a business imperative! So first review these resources, so you are better prepared to help. Consider this a very short (but top of the line) crash course on strategic thought.

What is Strategy?, by Michael Porter
Jim Collins on vision and values
Kaplan and Norton's excellent series of articles on Balanced Scorecard, the best thing to happen to strategic planning in the past fifty years.

Now get out there and change the world!

Saturday, December 29, 2007

a step towards investor transparency by the SEC

The SEC just released the first online tool which allows individuals to easily compare executive pay among top American companies. This is the first demonstration of how it will use XBRL-tagged data.


"Gone are the complicated data expeditions that forced investors to hunt through financial statements, footnotes, proxy statements, and other disclosure documents to figure out how much a company pays its top executives. Through its new rules and the power of interactive data, the SEC has transformed the landscape of compensation disclosure. The result is quicker and better analysis, and better-informed shareholders."
-- SEC Chairman Christopher Cox



This is long overdue. Congrats to the SEC for having the foresight and persistence to get this done.