Leadership Wisdom: Discovering the Lessons of Experience (J-B CCL (Center for Creative Leadership))

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Now that the company had established itself in the industry, it was time to reclaim the Neoforma brand. In the course of a few months, creating brand awareness in non-Novation hospitals became a core focus. Questions such as these were raised: How do we extract the products under the brand?

How do we inform the market, and talk about solutions versus marketplaces? How do we describe who we are? What we care about? Most hospitals ask two questions when considering something new: Can you prove to me that it works? Neoforma executives came to a deeper understanding of how important those questions were to creating credibility with new hospitals. They learned that they needed to demonstrate success in their installed base so that they could answer those questions for potential customers.

In this third stage, their prevailing strategy changed to driving the adoption of and reliance on their solutions in their installed base. There is evolution, possibly even an occasional revolution, as the organization tries different approaches, learns from those attempts, and implements strategic change. Assessing Where We Are. Leading organizational learning requires assessing where it is now—that is, collecting and making sense of relevant information about the organization and its environment.

Diverse pieces of industry data became relevant at different times for the Neoforma leadership team. It learned about the state of technology in nonclinical applications in hospitals and the general nature of IT spending in hospitals. This part of the learning process refers to the aspirational aspects of strategy making, including vision, mission, and core values.

Our placement of it in Figure 1. What is the identity of the organization? It continues to provide essentially the same services and products other than facilities planning , but the way in which it provides services and products has changed. That change has affected the way in which it thinks of itself. It has moved from an organization totally focused on a key partnership to one that creates and markets a brand of products and services.

Neoforma builds and operates leading Internet marketplaces that empower healthcare trading partners to optimize supply chain performance. Neoforma is a leading supply-chain management solutions provider for the healthcare industry. Brand] Learning How to Get There.

This element, depicted in Figure 1. It includes a focus on key strategic drivers and the business and leadership strategies necessary to satisfy those drivers. Strategic drivers are those relatively few determinants of sustainable competitive advantage for a particular organization in a particular industry or competitive environment also called factors of competitive success, key success factors, key value propositions. Organizations make choices about which strategic drivers they want to invest in—and excel at—in order to differentiate themselves in their industry.

The reason for identifying a relatively small number of strategic drivers for your organization is primarily to ensure that you become focused about what pattern of inherently limited investments will give you the greatest strategic leverage and competitive advantage. In learning how to get there, organizations also employ consciously or not two types of strategies: Business strategy is the pattern of choices an organization makes to achieve sustainable competitive advantage.

In addition, strategy involves a series of choices. In order to dedicate more money to quality, the organization purposefully spends less money elsewhere. For example, it may realize that mass advertising does not play a role in its success, and so it limits expenditures there. Finally, the strategy must be linked to the key drivers to ensure sustainable competitive advantage. Leadership strategy describes the organizational and human capabilities needed to enact the business strategy effectively.

What type of culture should an organization engender to create success?

What perspectives and abilities must individual leaders and teams have to be successful? What will they do to develop these skills and perspectives? The world of mergers and acquisitions provides a potent example of how inattention to the soft side can lead to failure. Timothy Galpin and Mark Herndon note that 70 percent of merger and acquisition deals do not achieve their projected synergies, and they cite many studies showing that the primary issues in those failures are the people and organizational culture issues. Neoforma has clearly tried different approaches to achieving success, some of which have worked better than others, and some of which worked for a time, but then changed in terms of priority.

For example, its leaders quickly learned that their initial driver—a pure focus on technology—was important in the early stages, but was not going to lead them to success in the long term. Another driver became important as they learned more about their industry: This is not to say that the technology was not important—it just was lower in terms of priority after Phase One. During Phases Two and Three, the drivers have not changed. That is, in both phases the company is emphasizing the ways in which it reaches its customers and also the products it can deliver.

However, the difference between Phases Two and Three lies in the strategies Neoforma adopted for reaching those customers. In Phase Two, the strategy was a partnership with Novation. In the early days, its culture was focused inward and was individualistic; it rewarded those who succeeded in making technology better.

As Neoforma came to understand the need for an emphasis on reaching its customers through marketing and distribution, the culture became much more customer focused. This part of the learning process framework involves translating the strategy into action by identifying and implementing tactics.

In making the journey, Neoforma chose tactics consistent with its strategies. For example, during the technology phase, it invested heavily in product development and allowed marketing and service to fall down on the priority list. For example, Neoforma invested resources to learn about the requirements and agreements created between Novation and its hospitals. Engineers and technicians also spent considerable effort learning about the back-end systems of the Novation hospitals.

The goal of these tactics is to demonstrate progress to both current and potential customers. Other tactics during this phase emphasize a focus on marketing to end users. Neoforma hired a vice president of marketing and is rebranding its products, including developing a new logo. Finally, service has become particularly important, as each end user has to feel supported by Neoforma.

Organizations continually assess their effectiveness by measuring key indicators related to their drivers and their strategies. It is also important for organizations to attend to their future capability. Are there measures to indicate success or not in building that future capability? In Neoforma, key performance measures have evolved along with the company.

Certainly the development of the technology was the focus in the early days, and the critical measures revolved around product development. Finally, in this last phase, a critical measure is the number of power users. Interestingly, although Neoforma executives describe themselves as going through these three critical phases, the knowledge of different phases was neither explicit nor intentional at the time, Table 1.

Phase One— Technology — Lack of even rudimentary IT tools in hospitals. Learning How to Get There Selling our technology to hospitals one at a time, business and leadership strategies built around developing and delivering the best technology. Checking Our Progress Success in development of the technology.

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Phase Two— Partnership — Hesitancy of suppliers to become involved unless guaranteed access to many hospitals. Existence of co-ops to offset costs and risks to hospitals and suppliers. Understanding Who We Are and Where We Want to Go A company that has partnered with a key organization to deliver our technology to the health care industry.

Making the Journey Tactics to immerse the mind-set, operations, and systems around Novation and its hospitals, such as learning about the back-end systems in these hospitals and creating a culture to support the Novation relationship for example, using the language of the hospitals instead of the language of technology. Checking Our Progress Performance measures related to the relationship with Novation, number of Novation hospitals that had adopted the technology.

Rather, in hindsight they can map the history of their organization to the cycle in Figure 1. It does not take having the knowledge of a process like that depicted in Figure 1. Successfully driving this process—whether it is explicit or not—does require effective leadership, a type of leadership we call strategic leadership.

Phase Three— Brand and Beyond. Understanding Who We Are and Where We Want to Go A company that has succeeded in reducing costs in the health care industry, and one that can help other hospitals too. Making the Journey Rebrand our products and services outside of Novation; develop key case studies of success with our installed base. Checking Our Progress Number of power users, growth in new offerings.

Implications for Strategic Leaders Conceptualizing the strategy-making and implementation process as one of continuous learning is not new in the strategy literature. The latter involves strategy as it evolves in real-time practice, with or without conscious realization that what is being done in the interest of organizational success may not necessarily be consistent with expressed strategy. Others also have commented on how strategy-in-practice can change somewhat beyond individual or organizational awareness that it is happening: Once the retreat is over, the binders tend to sit on the shelf and gather dust.

One reason may be that learning implies that something is not currently known—and the cultures of many organizations emphasize knowing.

Becoming a strategic leader

While there are many implications of viewing strategy as a learning process, we would like to explore four in particular: For most organizations, crafting strategy is more of a discovery process than it is a determination process or a process of choosing among a limited set of possibilities. It involves discovering the few key things the organization needs to do well and can do well to differentiate it in its industry. As Collins found, both good and great companies had strategies.

However, while the good companies set theirs from bravado, the great companies set theirs from understanding. It is an understanding of what you can be the best at. While you may feel exuberance about trying to conquer the waves and may be tempted to jump right in, you know that an expert surfer spends time watching the waves before ever attempting to catch one. You work to understand the impact of the direction, speed, and fetch of the wind the distance the wind blows over open water on the size and shape of the waves.

And this knowledge makes you even more energized about the possibilities; that is, you can actually fuel your exuberance with this disciplined learning. Discipline is even more necessary in strategy and in business. Collins notes that coming to an understanding of the Hedgehog Concept is an iterative process that takes four years on average , p.

Bravado, on the other hand, can happen instantaneously. Perhaps that is why it is so appealing. This discovery process is modeled week after week in our DSL program. We use a business simulation where executives run a company called Hawley-Garcia. For example, early on one regional group articulated key points of its strategy as follows: Leverage alliances to become a leader in specialty tools. It represents a much more informed strategy. Associated with this myth is the belief that the CEO and possibly the top leadership team go off for several days and come back with the strategy.

True, the CEO is ultimately responsible for deciding upon a path for the organization. True, the CEO often involves some team of senior management in that decision-making process. But that does not mean that these people are the only strategic leaders within an organization. On the contrary, the CEO relies upon input and insights throughout the organization to set the strategy, to enact the strategy, and to help in understanding how well the strategy is working.

The danger of this myth—that strategic leadership is reserved for those at the top—is that those lower in the organization will consciously or unconsciously believe it, will not see themselves as strategic leaders, and therefore will not behave as strategic leaders. The plethora of big-name CEOs who have been very successful leading their companies—both past and present—perpetuates this myth.

Names such as Henry Ford, Jack Welch, Lou Gerstner, and Andrew Carnegie bring to mind the image of people so bright and so good that they can single-handedly know the best direction for their companies, set the processes in motion to get there, and ensure that the company stays on track. However, more likely than not, these people were so good at leading their companies precisely because they relied on others. Consider the case of Dennie Welsh. Does his name sound familiar? So Dennie was not exactly a top manager within IBM. He told me that his vision of a services company was not one that did just IBM product maintenance and strung together computer codes for customers.

Here was a man who understood what customers were willing to spend money on, and he knew what that meant—not just the business potential for IBM, but the coming restructuring of the industry around solutions rather than piece parts [pp. Gerstner might well have come upon this idea himself, given his desire to integrate the various parts of the company rather than sell them off; however, he did not need to do it himself. He had good people below him he could rely upon. And he recognized the need to rely upon those people. A better understanding of the needs and perspectives of the various functions allows the product to come to market more quickly and to meet customer needs more effectively—two outcomes that are critical for competitive advantage.

This blurring trend has happened with strategy making and strategy implementation too. That is, the line between planner and implementer has become blurred. That is, strategic leadership is best exerted when information from the top is combined with information from the bottom ranks of the organization, and middle managers are in a unique position to do this.

It is no wonder that more and more people throughout organizations are feeling the need to become more strategic. Being a strong strategic leader means you have to focus on others as much as—if not more than—on yourself. Why this focus on others? The process of creating and sustaining competitive advantage in an organization is just too complex for any one person to develop and carry out. This list could go on and on, but these two items go far enough in suggesting ways in which the strategic leader can focus on others: What is the climate in your organization for sharing information?

Several of those silent killers are related to keeping things quiet in an organization—for example, a top-down management style and poor vertical communication. They cite Apple Computer as a prime example. It was known for several years in the s that Microsoft was developing the Windows platform, which would compete with the Macintosh by providing less expensive access to similar technology. While managers throughout Apple were arguing for the need to develop and produce a low-end product, Beer and Eisenstat note their senior managers responded by yelling that this was wrong.

This kind of response from any manager is virtually certain to inhibit information sharing. With respect to developing strategic leadership abilities in those around you, we ask that you read this book with others in mind, perhaps at least one other person you are working with who needs to be more strategic. You might even consider working alongside that person as you both develop so that you can provide support to each other. They use these skills throughout the cycle of learning to bring clarity and focus to the strategy, to enact that strategy with purpose and direction, and to engender the commitment of others to the future of the organization.

That is, a strategic leader will take action that then informs future thinking about the strategy. Indeed, this type of learning is the foundation of strategy as a learning process. A strategic leader will also invite others into the strategy-making process—not just to facilitate their buy-in to the process but also to produce a better strategy than could have been developed in isolation.

Each chapter will conclude with a discussion of that interdependency to help you make that connection. Surely one characteristic common to both of them is vision. From an early age Bill Gates had a vision of the future of personal computing, and that vision helped shape an industry. Twenty years later he made them himself.

Another characteristic these two creative leaders share is the ability to take stock of their present positions and anticipate what lies beyond the horizon—to scan their environment. They are also gifted at questioning implicit beliefs and assumptions.

It tends to be analytical, linear, verbal or numeric , explicit, and emotionally neutral. Vision, however, represents a different and less developed form of strategic thinking. Later we will turn our attention to how you can develop this type of strategic thinking. Unfortunately, the cognitive tools that strategic leaders have relied upon to accomplish these tasks have been unnecessarily constrained. Think of it this way: But strategic thinking has a softer side that is also a vital part of understanding and developing strategy, vision and values, culture and climate.

The word softer does not imply weakness but rather includes those qualitative thinking skills that are held in opposition to hardminded, quantitative rigor. You have to master not only the art of listening to your head, you must also master listening to your heart and listening to your gut. Virtually every organization today faces complex challenges that defy existing solutions, mental models, resources, and approaches. Leaders today must learn to apply their full range of strategic thinking competencies to the complex challenges their organizations are facing, and to supplement analytical skills with a multifaceted understanding that includes the following insights: Strategic thinking is nonlinear as well as linear.

Strategic thinking is visual as well as verbal. Strategic thinking is implicit as well as explicit. Strategic thinking engages the heart as well as the head. Synthesis, on the other hand, refers to the combination of separate elements into a more complex whole. Many managers today are considerably less practiced and competent in synthesis than in analysis. But creating strategy depends on synthesis as much as on analysis. Perhaps an analogy here might help. A concert can be broken down into the separate parts played by each individual instrument.

And not only can it be, but it needs to be in order for the musicians to practice their separate parts effectively. The concert itself—at least a good one—depends upon skilled craftsmanship combining the separate elements into a pleasing and coherent whole. In a good concert the whole is more than the sum of its parts, and the same is true for strategy.

Only certain patterns of choices, or combinations of alternative investments, contribute to a coherent whole a viable strategy. For example, the pattern of choices a company might invest in to enact a strategy of product innovation would be quite different from the pattern of choices it would invest in to be the low-cost producer in the industry.

Among other places, strategic synthesis occurs in the learning how to get there phase of strategy as a learning process. For example, projecting future sales by incremental adjustments to past sales often works quite effectively—but not always. Such events represent discontinuities for which linear thinking—basing future plans and actions on past experience—is inappropriate. Linear thinking cannot solve challenges in a nonlinear world.

Prior to that day, terrorism seemed a relatively distant threat to most U. Rather, we perceived that we had become vulnerable to a coalition of loosely coordinated yet highly adaptable terrorist cells operating somewhat clandestinely throughout the world Sanders, Most organizations have grown accustomed to the idea of fairly continuous change, and now the challenge is to learn to deal not only with continuous change but with disruptive change: Succeeding in such environments requires nonlinear as well as linear thinking.

Visual and Verbal As noted earlier, many people associate the word vision with strategic leadership. Less frequently do people fully appreciate the essential meaning of the word itself: The greatest visionaries are those who are able to paint a picture of a more desirable future. Vivid words and phrases rich in imagery help them convey that picture. The tool is called Visual Explorer, a set of several hundred diverse photographs and art reproductions selected for their visual richness and potential metaphorical association with varied business and personal challenges.

We frequently use Visual Explorer to facilitate conversations among executives about different business issues. We might begin, for example, by asking each of them to think about a strategic challenge facing his or her organization and then to select a picture that depicts in some way an aspect of that challenge.

Almost always those conversations take on a richness and depth that is missing in the primarily verbal and often abstract conversations typical in most business meetings. Implicit and Explicit We all know more than we are able to put into words. This ability becomes particularly important as leaders move into roles and positions of strategic responsibility in their organizations.

They especially trust their practicality and past experience. They especially trust their insight and imagination. Our data indicate a somewhat greater representation at top levels of management of individuals whose natural preference is toward trusting their insight and imagination. Slightly over half of middle and upper-middle managers have this preference, and 60 percent at the senior executive level do.

By comparison, more than two-thirds of the general population prefer to rely on their sense of practicality and past experience. These differences are consistent with our understanding of the nature of strategic thinking. The strategic challenges that executives confront are often novel, complex, and ambiguous. For that reason, strategic decisions are often not entirely data driven; they demand executive judgment that attends to the best information available but rarely can be determined solely by it.

In other words, strategic thinking is implicit as well as explicit. Heart and Head There is an old story about two stonemasons working side by side, each putting bricks together with mortar. Articulating organizational aspirations that inspire members to higher levels and quality of effort is one of the key tasks of strategic leadership.

Organizational aspirations involve understanding who we are and where we want to go. Imagine that you work for a pharmaceutical company. A goal might be to double sales—not a bad goal in itself. But quantitative goals like that rarely engage the whole person. Compare it with the examples in Exhibit 2.

Examples of Organizational Aspirations. To extend and enhance human life. To become the most recognizable brand in the world. To be a choir with a transformational impact on listener and member alike. Thus you might not have had much opportunity to practice or observe certain kinds of strategic thinking at work.

You can get an idea about that by just scanning the two groups of words in Exhibit 2. Words for Thought Processes. Nonetheless, both kinds of thinking competencies are required of strategic leaders today. The rest of this chapter is about developing these less developed competencies. Before you begin the next section, we suggest you assess your strategic thinking skills with the brief survey in Exhibit 2.

Evaluate Your Strategic Thinking Skills. For each of these behaviors, use the following scale to assess your need to improve in that area. Now we turn our attention to your developing competencies to help build and apply that less familiar side. When we work with managers and executives, we usually ask them to describe their own greatest challenges to becoming a better strategic leader.

Here are a few representative responses: Scanning and systems thinking both involve nonlinear thinking. Reframing often depends upon implicit thinking, and also can involve visual thinking. And making common sense requires synthesis more than analysis. Scanning Though the strategic learning process can actually begin anywhere, it typically begins with assessing where the organization is. This is commonly called a SWOT analysis; the acronym stands for strengths, weaknesses, opportunities, and threats. SWOT analysis is a common method for assessing where we are see Figure 2.

What internal capabilities or assets give the organization a competitive advantage? In what ways does the organization serve its key internal and external stakeholders well? In what ways does the organization fall short in serving key internal and external stakeholders? What conditions or possible future conditions in the external environment might give the organization a competitive advantage and enhance achievement of its vision if taken advantage of?

What conditions or possible future conditions in the external environment might put the organization at a competitive disadvantage and inhibit achievement of its vision if steps are not taken to minimize their impact? This organizational examination and analysis is sometimes called environmental scanning. Unlike an organizational SWOT analysis, which tends to be relatively systematic, individual scanning is apt to be quite Exhibit 2. Then have conversations with four other individuals from your organization: Compare their responses with each other as well as with your own analysis.

What were the points of agreement? What were the points of disagreement? The point is to be looking all around, to be vigilant for potentially useful information anywhere. To put it differently, scanning involves freeing yourself from the silos you may have erected in your mind and looking beyond selfimposed constraints that focus attention on information within a limited domain.

Good strategic thinkers often scan diverse sources of information, such as magazines and journals outside their business or industry literature. They seek out perspectives from others involved in diverse kinds of work. They can sift through information quickly, not necessarily deeply but with an eye for the anomalous or otherwise interesting bit of data. Scanning is especially useful in both the elements of strategy as a learning process highlighted in Figure 2.

As noted, a SWOT analysis is a common approach to assessing where we are. Furthermore, emergent strategy typically arises based on discoveries or adaptations made when making the journey, so scanning is useful there too. Visioning A vision represents a view of what the organization or a department, group, or other unit can and should become. At the same time, however, many individuals also hold personal but unspoken versions of organizational aspirations. Unfortunately, they seldom share these personal visions. Knowing the different implicit aspirations individuals have for their organization can be informative and even inspiring.

Your assignment is to write a one-page newspaper article portraying your vision and aspirations for Harlequin.

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The article should represent what would make you proud to be able to say or write about Harlequin three or four years from now. Write the story so that it evokes feelings of pride when you read it, and conveys a sense of what kind of company Harlequin is, as well as what it has accomplished. As any good journalist would, of course, you will want to cite a variety of supporting material including quotes, business results, anecdotes about corporate culture and morale, etc. As we expected, the team initially balked a bit at these instructions and lobbied to merely outline their respective organizational visions with a few bullet points.

They acceded to our approach, however, and were amazed and pleased at the quality and richness of input, across the board. And I thought I had big goals! Appreciation for the passion of reading, for all the people that bring passion to life for millions of readers, and for the skill and talent that it takes to accomplish that.

Harlequin is my kind of company—one that cares about its family of readers, and its employees, and can still be successful. It affords broader opportunity for people to share personal versions of aspirations for the organization. It also can inform people throughout the organization Exhibit 2. Compare your own aspirations for your organization with others using the newspaper article technique described in this chapter. After the stories are completed, share and discuss them and use them as a springboard for developing a shared vision. Individuals in the group can exchange their respective articles and note points of correspondence as well as differences.

They can use questions to guide their reading, such as these: How high are your aspirations for the organization? Were there ways that others saw the organization changing that did not occur to you? What could make you more conscious of changes like those whether or not you see them as desirable? It involves questioning or restating the implicit beliefs and assumptions that are often taken for granted by organization members.

It plays a critical role in the formative phases of the strategic learning process from assessing where we are through learning how to get there, as highlighted in Figure 2. The process often uses metaphors like those outlined in Exhibit 2. Reframing the Nature of the Business at Yellow Freight.

One example of strategic reframing involves Yellow Freight, a trucking company that transports big, heavy freight. A new CEO helped turn the company around, and a key part of the effort involved learning that its assumptions about its customers were all wrong Salter, When it eventually surveyed a large sample of customers, however, the company learned that reliability and quality were what mattered most: How to Get There.

Complex phenomena like leadership are often grasped more easily through the use of metaphor. Many different kinds of metaphors are used to describe leadership. Here are a few: Reframing the Nature of the Business at Starbucks. Reframing can be an essential part of resolving an organizational dilemma, but it also can be experienced as unhelpful and disruptive to those who may not perceive any dilemma. Starbucks began in as a very different company from the one we know today.

The difference is due in large part to the way its chairman, Howard Schultz, reframed the kind of business Starbucks should be in.

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Schultz joined Starbucks in to head its marketing and retail store operations. He concluded that the Starbucks stores in Seattle had missed the point; Starbucks should not be just a store but an experience—a gathering place. Prompt your own reframing of strategic leadership issues by asking yourself questions like these: How might doing that change the nature of our organization?

Even the mere labeling of external conditions as opportunities or threats can change the ways people respond to them. For example, the perception of external conditions as opportunities tends to broaden organizational participation in the response and evoke decisions representing relatively small changes that are directed at the external environment. Research has shown that one of the most powerful factors affecting decisions is whether the stakes are framed as potential gains or potential losses.

Daniel Kahneman and Amos Tversky developed a paradigm for decision research that has stimulated numerous studies of this dynamic. Say, for example, that you are responsible for the installation of a new IT system in your organization at three separate operating locations. Unfortunately, you have discovered that a computer virus has infected the system. The virus seems resistant to all existing countermeasures, and the entire system will be lost if the virus is not successfully countered in the next twenty-four hours. A new virus detection company may be able to save all your equipment, but the result is not certain.

The company gives you two options. The equipment at the other two sites will be lost. But it has a two-thirds chance of losing the computers everywhere. But what if the choices had been different? The equipment at one of the two locations will be saved. Faced with these choices, 80 percent of people choose option 4. That is intriguing, especially when you realize—as you probably did here—that the two pairs of alternatives are identical and merely framed in different ways.

People tend to avoid risks when they are seeking gains, but they choose risks to avoid sure losses. Explore alternative ways of framing the problem to see whether that makes a difference in the relative attractiveness or apparent desirability of the options. Helping People Get Things Done: Proven strategies for you to: The Amazonian Warrior Workout: Get the latest news and analysis in the stock market today including national and world stock market news business news financial news and more Nous voudrions effectuer une description ici mais le site que vous consultez ne nous en laisse pas la possibilit MowerPartsZone com just announced the opening of their retail store at Oak Ridge Highway in Knoxville TN They are located in the former location of ProGreen Plus.

Influence is an essential component of leadership. Developing your influence skills can help you gain commitment from people at all levels: This book includes an assessment tool to help you determine the influence tactics you currently use. Some tactics depend on logic, others appeal to emotions, and others are cooperative appeals.

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