The end of Strategic Planning

Bookmark and Share

MusicPhilosophy-18

Images: Courtesy of Music Philosophy (Mico, you rock!)

Strategic Planning was born around 100 years ago when the first cars went into mass production: The lack of product was vast and the economic landscape easy to oversee, making it easy for companies to adjust to changes immediately. Markets were slow and people believed humans can achieve anything, supported by Strategic Planning. This mechanical view of the economy and an enterprise left the role of Strategic Planning almost untouched and its importance has even grown over time.

Problem is: The world enterprises operate in has dramatically changed. In a world of saturated markets, educated people playing their consumer role rather unwillingly, globalization, terror attacks, ash clouds, etc. Strategic Planning becomes a farcical endeavor. Maneuvering an enterprise has become an illusion. But we continue to plan.

MusicPhilosophy25-07

Strategic Planning is a waste of time

Successful companies are highly flexible and adaptable in an ever-changing world and market. That’s the opposite of a plan: focusing on getting something done in a certain amount of time.

Let’s just have a look at the US government: Every year they plan on paying down the debt – and every year they face  new surprises: high unemployment rate, a Supreme Court decision, an oil spill. Immediately, all the Strategic Planning is out the door and projections have to be adjusted. Planning is not forward-looking, Planning is static and reactive.

Same is true for enterprises: The performance of a company is more often than  not influenced by factors out of their influence sphere: price of commodities change, currencies fluctuate or a banal law changes somewhere in the world and affects the performance of the enterprise – once again, projections have nothing to do with reality. This results in permanent frustration. And, companies develop the tendency to find someone to blame: Purchasing, Sales, Product.

Anyone who still hopes to control the future with numbers has no clue how markets work nowadays, doesn’t know how you can get optimal performance out of all stakeholders or just lives in a perfect world, fueled by selfish wishes and hopes.

MusicPhilosophy2-17

Executives don’t like change

The idea that executives don’t maneuver the enterprise through the stormy seas (Actually, it’s the other way around.) doesn’t fit in their MBA-fueled pipedreams of being the sole savior of this struggling ship. A myth born in the Industrial Age. In addition, executives believe they need Strategic Planning to control their employees. At its core, most managers believe their employees are lazy bums that can’t be trusted. (Honestly, without me they just wouldn’t do anything all day.) For that reason, employees need to get clear goals and constant observation.

Peter Drucker’s Management by Objectives (MBO) gave executives more fodder for their bizarre prejudice that people without objectives have no clue what to do. People wouldn’t work efficiently without planning goals. This resulted in an enterprise world gone crazy: Increase revenue by 13%, reduce costs by 12%, service has to increase their number by 10% for the next 5 years. Totally absurd. We call it: Management.

MP01

Shift power from executives to all stakeholders

This absurdity we call management has to be replaced with a new paradigm:

  • Focus on relative goals
  • Empower your employees by trusting them 100% and allow them to react individually to demands of stakeholders
  • Focus on culture

Don’t stick to numeric goals: Would you want a NASCAR driver to win a race or plan for him to drive the race in 2 hours and 32 minutes? Foster a culture where it’s about winning not making numbers.

If a department/division/branch has problems, don’t let the executives take over. Stakeholders have to find their own way out of the mess and don’t need the savior from headquarter. This might leave the executives with less opportunities to congratulate themselves but will increase team morale dramatically. The role of leadership has to be be redefined: It’s not about controlling people. That breeds resentments. And crushes spirits.

It’s about inspiring people. Engaging them. Executives need to lead, not control.

MusicPhilosophy2-21

Redefine enterprise success

Executives have to throw away their outdated Org charts, their hierarchy thinking and the focus on their selfish goals. The new enterprise places stakeholders on the pedestal, makes humans not plans their focus. Once you place your trust in all your stakeholders and empower them, goals like shareholder value, executive salaries and bonuses will fall into place.

Enterprises need less goals, not more. Goals are overrated. Real success metrics are an organic byproduct of a real corporate identity. It shouldn’t be about corporate goals determined by a few, it should be about corporate identity lived each and every day by all stakeholders. Focusing on corporate culture will help enterprises to develop a congruent group of like-minded people. Forget the performance review. Lean on peer pressure as the guiding force.

MusicPhilosophy28

Strategic Planning vs Being Prepared

Strategic Planning means: Derived out of an executive vision of the future and assessment of the present, the company develops a plan that everybody has to follow blindly. Enterprises based on this belief try to manage the future.

Being Prepared means: We’re trying to be ready for any eventualities, we prepare, we’re staying intellectually fit, always question everything – never separate acting from thinking. Being prepared is an attitude. This attitude will allow companies to be successful in the future. Strategic Planning dooms them.

MusicPhilosophy-04

Strategy has its roots in the military. Even the military doesn’t need mindless warriors anymore

The idea of Strategic Planning was based on the thought construct that there are two kinds of people: The thinkers, the directors, the controllers. And the mindless workers that do their task and don’t ask questions. Strategy is a tool to keep the doers from thinking and under tight control.

Since the markets control enterprises more efficiently than managers, what’s the value of managers hiding behind strategy decks anymore? Instead, every stakeholder has to think, adjust and do. What company still can afford to employ non-thinking people, happily entrenched in operations? That’s what automization is for.

MusicPhilosophy-21-02

Perpetual Test Mode

Enterprises need to ask themselves constantly “How could I do this better?” even when everything works out fine right now. Once enterprises believe they’ve found the perfect model, they will switch into the mode “Why change anything?” And die.

Enterprises need to follow two paths:

  • Implement perpetual, incremental improvements. Why not improving a dozen of little things? Can you improve your website daily outside of the yearly refresh? Can you change the way customer service interacts with people? Are your key employees fully invested on Social Media Channels, always ready to reply? How can you move your company from good service to utter delight?
  • Think big: Some problems can’t be solved with incremental changes. They need significant innovations. How can you leap ahead of your competitors by rethinking how a problem can be solved?

MusicPhilosophy20-16

How to begin the transformation process

This is an unusual paradigm for enterprises. Everything they learned in business schools and on wooden conference tables is useless. Even more: counter-productive.

It behooves every employee to internalize this new world view. And start to develop multiple pilot projects or beta programs. A good first step would be to eliminate the yearly performance reviews and axe yearly planning.

Let’s face it: the world was not meant to be perfect and nobody can control it. We’re supposed to muddle along and work our way through challenges and problems. Once enterprises accept this fact, they have a chance to succeed in the future. Most importantly: As long as managers don’t trust all stakeholder, as long as they don’t believe people will work without control and incentives, just because they want to, as long as managers don’t change their thinking, enterprises will remain the places of outdated hierarchy, intellectual imprisonment and planned economy.

Bookmark and Share

youwillneverknowifyounevertry

Image courtesy of 24.media.tumblr.com

During the dot-com bust, I interviewed for a position with a digital consulting firm. The job description sounded like a good match, the company had a good reputation and strong growth: I was excited. After speaking to the CEO for 5 minutes, I knew his company wouldn’t be my future home. Why? Because I had no idea what he was talking about. Every other word was a buzzword, he must have made up words on the fly and the sentences were so long and convoluted, I felt he was filibustering the interview.

One reason brands have problems connecting with people is their use of language. A few examples:

Dachis Group: “Social Business Design helps companies reinvent themselves into dynamic, socially calibrated organizations that gain constant value from their ecosystem of connections.”

Dell: “Increase workforce flexibility while storing data or secure servers – enabling highly centralized control over your distributed environment and aligning clients with their organizational needs.”

Ford: “Covert aerodynamic design and critical technology such as the class-exclusive PowerShift six-speed automatic and 1.6L Ti-VCT Duratec® I4 engine with twin-independent variable cam timing make it a responsive and fuel-responsible driving experience.”

I chose those 3 companies because they’re often heralded as the pioneers of Social Media and Social Business. Did you have any clue what they were talking about? I had some idea but became bored a few words in.

We have developed a lexicon of contrived gobbledygook meant to confuse people not to enlighten them. How can you claim to be social when your outward language is anti-social?

Just go to digital conferences and half the words abused have no real definition (Engagement), 1 million definitions (brand) or their meaning changes day by day (Success Metrics). We tend to use imprecise words to cloud our confusion and hide the fact our thoughts are not that well-thought-out. A refined thought doesn’t need to come in a convoluted package. Or, as Winston Churchill said: “Broadly speaking, the short words are the best, and the old words best of all.”

Amidst the corporate gibberish, brands have a unique opportunity to stand out from the masses by speaking plainly yet intelligently about the matter at hand. Not only only will you be seen as having a stronger grasp of the issues, but people will form stronger connections with companies.

In a complex world, any effort to simplify will be appreciated.

We were put on this earth to change the world

Bookmark and Share

photo (1)

This is my daughter. Look at her. There’s this aura of infinite possibilities – she’s ready to take on the world. Nothing will stand in her way to explore this world that’s hers. We all used to be like that. We all had this fire in our eyes. Each morning we couldn’t wait to get out of bed, ready to make this world our world. We were curious. Eager. Had so many questions. Tried things out. Fell down. Tried them again.

And then life happened to us. Or better, institutions stood in our way. Pre-school. Kindergarden. Norms. Criticism. Homework. Schedules. School. Cruel teachers. Critical teachers. Grades. Norms. The system integrated us. We integrated the system into our lives. Into our thinking. And being. We graduated. When we were lucky, we traveled for a while. Found that joyful life experience again. But now it was time to join the workforce. To fit in. To accept mediocrity. Suddenly, it’s hard to get out of bed in the morning. Weekends and vacations are the only remaining highlights. We are slowly killing off everything that made us happy and curious in the first place.

Hold on, we just got a second chance.

The Great Recession is the biggest opportunity we will encounter in our lives. The Great Recession equals major hardship for many people but it also marks the end of the corporate era. If you’re corporate drone, your job will be eliminated very soon. If you try to fit in to make it in this world, you will struggle for the rest of your life. In order to succeed, you have to become an artist.

That’s the premise of Seth Godin’s newest book “Linchpin – Are you indispensable?” We have to become more human, creative and generous to be seen as unique and irreplaceable. And, most importantly, we have to ship. Meaning, we have to produce. Not spending hours on email trafficking, Twitter scanning, blog commenting. No, shipping. Producing. Doing. We can either give in to the lizard brain, the little part of your brain that is concerned with survival and is the reason for your procrastination and all your irrational fears. Or we can create our own destiny. Our own reality. And, at the same time, change the world.

Seth Godin’s Linchpin might be the most important book you’ve read in a long time. Hopefully, it will change you and your thinking. We’ve been working with major Fortune 100 corporations for years, even decades. We understand how tough it is to implement cultural change. But, it’s necessary. Actually, it’s imperative. Would you rather help your company change or see it vanish?

Seth Godin’s Linchpin and Hugh McLeod’s Evil plans (he illustrated Linchpin because he’s one) will give you the motivation and desire to change the world. We started our company with the goal to help transform businesses and change the way we work and live. Seth Godin distilled our thoughts in a neat and exciting package. Now it’s your turn to take the ball and change the world. We hope you’re ready.

Human Business Design

Bookmark and Share

ifnotnow

We are not Social Media experts. We’re not Six Sigma pundits. And we don’t have all the answers.

In fact, we are skeptical of people who claim they know all the answers and provide them through Org Charts, Twitter pages or pie-in-the-sky strategy decks.
We are simply people across a wide range of communications and management disciplines with the unifying belief that businesses need to adapt and transform in the new reality of a post-consumption economy.

We see an incredible economic opportunity if we develop new ways to reframe problems, seize emerging opportunities and design solutions by looking behind the consumption-oriented economic model.
Just as we emerged from the dark ages to a new era of social and artistic enlightenment, we are now entering the post-industrial and post-Lehman age with the realization that the well-being of our economy should not be based on consumption alone and focus more on the human element.

For more than 100 years, businesses have focused on driving efficiencies, improving processes and increasing shareholder value. With the advent of new technologies, businesses invested billions of dollars in technology and transaction systems to reduce latency and inefficiency in value chains. “Six Sigma” is the epitome of this focus and thinking. However, the ROI on further optimizing processes for operational excellence is diminishing because of the human element. Unless you’re an Android, you can only be that productive, that efficient, that process-oriented without losing your humanity.

As Super Social Primates, our need to connect with others is deeply ingrained into our DNA. This is the reason why solitary confinement is regarded as the ultimate punishment. And babies with a loving relationship to their family have dramatically better chances to succeed. New and intuitive technologies have allowed us to connect with people in ways we could not have imagined a few years back. But we warn against the focus on technology: Too much energy and attention has been spent talking about CRM/Social Media/Networking technologies that many have missed the point: without people none of that matters.

Our thinking is based on the fundamentals of human needs and behavior. Technologies are just tools to tap into these needs, allow for connections and enable like-minded to come together. These technologies are merely the platforms for connecting and sharing. And they allow people to deliver on the normal human desire to be accepted and valued by others. By linking, commenting, discussing and sharing, individuals gain authority and influence in the social space and thereby develop and increase their own levels of esteem.

We see a lot of encouraging signs that thought leaders and innovative practitioners are trying to incorporate principles of social networking/computing into the enterprise. Some call it Enterprise 2.0, human-centered design or Social Business Design. These models assume that humans are rational primates, always acting in their best interest.

The financial meltdown and newest studies in Behavioral Economics are super-sized reminders that the human mind is continually trying to perceive things that aren’t true, and not perceiving them takes enormous effort.

Our brains evolved to suit a world much simpler than the one we now face. We tend to believe data to confirm our prejudices and ignore data contradicting them; we overvalue recent events when anticipating future possibilities; we weave single multiple events into a causal narrative; we applaud our own expertise and skills in circumstances when we’ve actually benefited from dumb luck.

In short, we had to learn that we’re predictably irrational (to borrow from Dan Ariely’s fascinating book). In ‘The Happiness Hypothesis” Jonathan Haidt compares the self to a rider on the back of an elephant. He writes:

“The image that I came up with for myself, as I marveled at my weakness, was that I was a rider on the back of an elephant. I’m holding the reins in my hands, and by pulling one way or the other I can tell the elephant to turn, to stop, or to go. I can direct things, but only when the elephant doesn’t have desires of his own. When the elephant really wants to do something, I’m no match for him.”

For the longest time, institutions have focused on the little boy while tinkering with the elephant. And we’ve optimized the little boy for the longest until we finally hit the wall. It’s time to focus our attention on the elephant and tap into its enormous potential. We don’t believe current models effectively stimulate the endless potential of human emotion and creativity.

For that reason, we propose a new model: Human Business Design.
What is Human Business Design? It is a model based in the belief that all human interactions/conversation inside and outside of your organization matter now: The way human beings are motivated to connect and create value has changed. Every business has to realize that it is a co-creative eco-system that includes its employees, partners, competitors and customers and the way they are motivated to create and realize value is the only measure of success.

Organizations need to provide a framework for their customer base (and entire ecosystem) to participate in the co-creation of meaningful value. The new paradigm is co-creation, co-operation on bigger ideas than just the motivation to consume. Each good organization has a big vision behind its products and services. And the goal has to be that all stakeholders work on this bigger vision.

This allows us to merge the left-brain efficiencies of organizations with the right-brain imagination of hyper-connected human beings, creating new value propositions nobody ever imagined.