Francis Wade|Why “short-term strategy” is a misnomer | Business
Have you ever been stuck in a strategic planning session, complaining that “it’s nothing more than a continuation of old tired thoughts?” You know you need to step in and somehow change the level of thinking, but you don’t know what to say and you certainly don’t want to make things worse. Are you suffering in silence or trying to show leadership?
The truth is, you may already be someone who looks to the future and wonders why your business doesn’t see the future the way you do. If so, know that it is rare. Most of your peers are fine with the flow.
To be different, don’t sit around waiting for a juicy “I told you so” after retirement. Instead, harness your engagement by challenging your team to think strategically. Here are some ways to steer the ship.
1. Insist on long-term planning
Begin by emphasizing that strategies are not the same as tactics. In this vein, there are no short-term strategies. Tactics should only exist to implement a strategic plan, which should always be long-term. While it’s entirely possible to engage in day-to-day tactics without a strategy, it’s unlikely to be sustainable. At some point, your lack of foresight will lead to actions that make matters worse.
While some say they have a “five-year long-term strategy”, you should immediately object to it. Again, there is nothing. If asked, explain that a five-year strategy is just a lazy extrapolation of past events, plus a few adjustments. This is the easy way out – the path of least resistance.
This is the kind of thinking that dooms business. There’s a reason GraceKennedy created a 25-year strategy in 1995 and then left its competitors in the dust. Most don’t even remember who they were.
Do you remember Kodak? Why Fuji, their big rivals, became a chemical company when Kodak went bankrupt is a short-term and long-term case study. By 2000, the two were at the top, but only 12 years later Fuji’s pivot was paying off as Kodak reaped the results of outdated tactical judgment.
The purpose of a long-term strategy is to sustain the organization and ensure its continued success. It won’t come by limiting your thinking to a comfortable future like Kodak has.
Instead, your business needs to look to the horizon and choose a destination. In other words, it must be like Columbus. His fellow sailors in the 1490s were afraid to sail to the edge of the world. Managers today are just as afraid of making plans too far into the future. Therefore, they limit their businesses.
2. Focus on the next generation
Short-term planning also tends to be a selfish exercise, by default. After all, it’s only human to care about yourself first.
However, a team that creates results 15-30 years later instantly flips a switch. As if by magic, he automatically focuses on succession.
For example, a Caribbean company that intended to expand into Latin America set significant market share targets. However, through detailed planning, he discovered that he would need his headquarters to be in Miami. Over time, society would become American.
After facing this fact, its leaders decided not to permanently disenfranchise future generations of Caribbean leaders by losing their Caribbean orientation and seat. Instead, to keep the business in the area, they scaled back the plan drastically.
Even in the face of such helpful thinking, some argue that technology is changing so quickly that it’s impossible to prepare for it. However, during long-term planning sessions, teams learn that basic customer needs do not change. The only question they must keep asking is, “How will they be satisfied?”
In this context, technology is changing the way unmet customer needs are addressed, so emerging innovations need to be considered. But the overall goal of serving customers does not change from generation to generation.
Therefore, the main question to ask now is “Where is our business going in the long term, and what technologies and human capabilities should we invest in today to get there?” The right answers are hard to come by, but management teams have no choice but to fight to find them. Why? Partly because leaders will always have limited information. And disruptions have become a fact of life.
Faced with these limitations, you must always think long term. As Winston Churchill said, “Plans are of little importance, but planning is essential.”
The goal of long-term exercise is not to be correct or precise. Instead, it’s about engaging in the difficult planning and decision-making processes that can make or break a business. As a session attendee, it’s a challenge worthy of inspiring your team to take on.
– Francis Wade is a management consultant and author of Perfect time-based productivity. To receive a summary of links to previous columns or provide feedback, email: [email protected]