The World Cup is upon us and as a lifelong soccer fan and player, I reflected on a few insights that the soccer game taught me that can be applied to small and large businesses.

1. Embrace and live your culture

I started playing soccer when I was 5. We practiced twice a week and played each Saturday. Raised in Germany, our practice consisted of 90 minutes running and 30 minute playing time. Fairly insane when you think about it: forcing 5-year-olds to run for 90 minutes through the forest or doing laps after laps. But that’s the German culture for you. We were no masters on the ball but my team could outrun anyone. We won 90% of our games in the last 10 minutes because we never tired. (I hope there’s more balance in today’s practices in Germany, though)

Each country has a specific soccer culture: the playfulness of Brazil, the physical intimidation of England, the defensive discipline of Italy, the exuberance of African teams. While you need to embrace and live your culture to be successful, you shouldn’t fall in love with it and be always open to change. Brazil wasn’t a dominant force in the 70’s and 80’s because they focused too much on playfulness and not enough on execution. Once they added execution into the mix, matches and World Cup’s were won again.

2.) Hire entrepreneurs

Most soccer coaches last only for a few years. It’s a tough job to gather all your players from clubs all over the world, fight internal bureaucracies and deal with the press. Coaches, just like players, are superstars. They have to take huge risks in order to succeed and most of them fail. Just to rise on some other bench to try it again.

Soccer is a team sport but individual decisions make or break a team. The collective approach to soccer will always fail. Both coach and player are entrepreneurs, and the more creativity they display, the more leeway they are given. Coach and players have two different tools of influence to impact the outcome of the game.

The coach can create a cohesive, yet competitive culture that rewards creativity and innovation, build team spirit and nurture team culture. He has strategic tools at his hand (formations, substitutions, etc.) but his input won’t lead to innovation or moving the game to a new level.

This is done by 22 feet of 11 individual players. Players innovate on a daily basis to get a small but significant competitive advantage. They need to surprise other players with new ways of dribbling, moving, passing and reacting. The coach is there to create the right environment for players to innovate. Daily. With every move.

3.) Dramatic innovation is rare. Daily innovation a must.

As a soccer aficionado, it’s very interesting to watch games from the past and compare them to today’s sport. The game was much slower, formations not as fluid as they are today and positions have been redefined over the years. But, what’s even more intriguing is that these changes take years to really come to life. Franz Beckenbauer perfected the position of “Libero”, the “sweeper” before the goal-keeper, freeing him from marking a direct opponent. (Rather revolutionary, if you think about it: Instead of marking a person, you’re defending a zone.) He played his first World Cup in 1966, not really filling the position of Libero yet. In 1970, he showed massive improvements on this new style of play but it took him until 1974, when he crowned his career with a World Cup win and a performance that showcased his evolution from support player to innovator.

Innovation didn’t happen in one game. It happened over more than a decade. And influenced generations to come.

4.) Don’t blame technology. Don’t worship technology. Just use it.

Each time the World Cup comes around, there’s a lot of talk about the new ball. Some people fear it, some embrace it. Most players don’t care. The ball is just a tool they use to accomplish a task. Because it’s new, players will have to find the challenges/dead spots when handling or shooting it. Introducing a new ball right ahead of the biggest sporting event seems wrong. But it is a great way to determine the best playing team and the team that answered this challenge with a strong creative approach. There’s nothing to fear. And a lot to explore.

5.) Play. Hard.

I could write about the beauty of soccer, get all poetic and philosophical. But the real beauty of this sport is that’s it’s still a game. When players have a creative thought, they can implement this idea immediately. And fail. Or succeed. At the heart of American Football is strategy. Creativity is not rewarded. At the heart of soccer is creativity. (Based on a foundation of technical excellence, supreme conditioning and mental toughness.)

Tomorrow the World Cup begins. A clean slate. For all we know, North Korea might win it this time. Or South Africa. History exists only in the books and in our heads. On the grass, there’s no history. Just opportunity. Possibilities. The best playing team will win the tournament.

And, that’s the most important lesson soccer can teach business: Business is a game that reinvents itself each and every day. The basic rules remain the same, your team defines how to play with these rules creatively. As an executive, it’s your responsibility to assemble the best players, to lay down the rules and develop plans. At the end of the day, the players have to play to move your business. Let them play. And enjoy each moment of it.

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.

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.

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.

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.

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.

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.

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.

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?

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.

image via http://www.cs.cmu.edu

There is always a fair amount of conversation surrounding innovation in business.  It’s one of those curious words that people are familiar with but don’t really grasp.  I felt this way, so I did what I often do and stepped back to look at the origins of the word and its definitions:

innovate 1548, from L. innovatus, pp. of innovare “to renew or change,” from in- “into” + novus “new.”
Online Etymology Dictionary, © 2010 Douglas Harper

in·no·vate

1. to introduce (something new) for or as if for the first time: to innovate a computer operating system.
2. Archaic. to alter.
Dictionary.com Unabridged Based on the Random House Dictionary, © Random House, Inc. 2010.

Now,  when innovation is typically referred to in a business setting, it generally implies something completely new, revolutionary, or groundbreaking.

Does it need to be?

I’d like to focus on the origins of the word – from the perspective of renewal or altering – instead of focusing on bright shiny objects we typically bill as innovative (FourSquare, your new Social CRM, iPad, Twitter, Sales Force Automation tools, Facebook fanpages, etc).

Let’s focus first on renewing and altering our foundations.  Redesign or “innovate” organizations not only from a tool perspective but from a people perspective.

I’ll leave you with a great talk by Roger Martin surrounding the concept of Design Thinking.  I recommend listening to this (and reading his book) and hope it inspires you as it did me.

Image and T-Shirt by Origin68

Orson Welles’s first film was Citizen Kane. It’s still considered one of the most famous and highly-rated films, partly because he deployed innovative cinematic and narrative techniques. In an interview in 1969 with Huw Wheldon, Welles explained where he got the confidence to make this new kind of film:

Welles: Ignorance, ignorance, sheer ignorance – you know there’s no confidence to equal it. It’s only when you know something about a profession, I think, that you’re timid or careful.

Wheldon: How did this ignorance show itself?

Welles: I though you do anything with a camera, you know, that the eye could do and the imagination could do and if you come up from the bottom in the film business you’re taught all the things that the cameraman doesn’t want to attempt for fear he will be criticized for having failed. And in this case I had a cameraman who didn’t care if he was criticized if he failed and I didn’t know there were things you couldn’t do, so anything I could think up in my dreams I attempted to photograph.

Wheldon: You got away with enormous technical advance, didn’t you?

Welles: Simply by not knowing that they were impossible, or theoretically impossible.

Embracing ignorance allowed Welles to challenge the boundaries of existing knowledge and develop innovative techniques still utilized in today’s film-making.

While organizations are racing to embrace Knowledge Management and deploy systems to benefit from it, enterprises that engage in creative and innovative activity need to consider ignorance as a virtue. Accumulating and managing knowledge can become a dangerous trap when it just reinforces biases and don’t drive organizations into new ways of thinking and approaching challenges.

Knowledge Management has to find the perfect balance between deploying existential information, eliminating knowledge that has run its course and embracing ignorance in the pursuit of creativity and innovation.

There’s a reason why companies are looking for fresh blood all the time: They need to get new ideas and new assumptions into the system in order to continue to be a living organisms. Too often, new ideas and new brains are being streamlined quickly to ensure the system doesn’t break and everybody can continue on their merry way.

Enterprises need to develop systems embracing ignorance as a corporate virtue and integrating Ignorance Management into their Knowledge Management system. Human knowledge is limited, human ignorance has no boundaries. Strategic Ignorance Management will transform your business and turn your workforce from order-taking drones to creative contributors.