Blog

Strategic Thinking as “Seeing”

14 September 2018

Maybe we think too much and see too little. What, then, does strategic seeing mean?

Let’s begin with what strategic thinking is not. It’s not following an industry recipe or copying a competitor’s strategy or continuing to do what was always done—at least not unless these have been carefully considered. In other words, strategic thinking is not mindlessness, not imitation, not thoughtless persistence. Nor is it purely cerebral: separating self from the subject of strategy and working it out cleverly in a meeting.

Most people would agree that strategic thinking means seeing ahead.

But we can’t see ahead unless we see behind, because any good vision of the future has to be rooted in an understanding of the past. To paraphrase Kierkegaard, life may be lived forward, but it is understood backward.

Maybe we think too much and see too little. What, then, does strategic seeing mean?

Let’s begin with what strategic thinking is not. It’s not following an industry recipe or copying a competitor’s strategy or continuing to do what was always done—at least not unless these have been carefully considered. In other words, strategic thinking is not mindlessness, not imitation, not thoughtless persistence. Nor is it purely cerebral: separating self from the subject of strategy and working it out cleverly in a meeting.

Most people would agree that strategic thinking means seeing ahead.

But we can’t see ahead unless we see behind, because any good vision of the future has to be rooted in an understanding of the past. To paraphrase Kierkegaard, life may be lived forward, but it is understood backward.

Of course, even the best knowledge of the past may not help to see the future. We need to foresee discontinuities rather than extrapolating trends. And for this, there are no techniques, not much more than informed, creative intuition.

Some people think that strategic thinking is about “distinguish the forest from the trees”. The only way to do this is to hover above those trees. To them, therefore, strategic thinking is seeing above.

But can anyone get the “big picture” just by seeing above. The forest looks like a carpet from a helicopter, yet anyone who has taken a walk in a forest knows that it doesn’t look like that on the ground. Strategists can’t understand much about forests if they stay in helicopters, nor much about organizations if they stay in head offices.

I prefer the metaphor of finding the diamond in the rough: see the gem of an idea that changes an organization. And that does not come from the big picture at all, but from a lot of hard and messy digging. Indeed, there is no big picture (let alone precious gem) readily available to strategists. It must be constructed from the details that they dig up—or the brushstrokes painted one-by-one. Thus, strategic thinking is also inductive thinking: seeing above must be inferred from seeing below.

Yet you can see ahead by seeing behind and see above by seeing below and still not be a strategic thinker. That takes creativity, even ordinary creativity. Strategic thinkers see differently from other people; they pick out the precious gems that others miss, paint their own pictures, challenge conventional wisdom—and thereby differentiate their organizations. Such thinking has been referred to as lateral thinking, and so we can call it seeing beside.

There are many creative ideas in this world, far more than we can handle—just visit any art gallery. And so, to think strategically requires more than just seeing beside. Those creative ideas have to be placed into context, to be seen to work in a world that is to unfold. Strategic thinkers, in other words, also see beyond.

Seeing beyond is different from seeing ahead. The latter foresees an expected future by constructing a framework out of the past. The former constructs the future—it invents a world that would not otherwise exist.

But strategic thinking is not finished yet, because there remains one last necessary ingredient. What is the use of doing all this seeing—ahead and behind, above and below, beside and beyond—if nothing gets done? In other words, to deserve the label strategic, thinkers and organizations must also see it through.

Put this all together and you get the following: strategic thinking as seeing.

©Henry Mintzberg 2018. An early vision of this appeared in J. Nasi, ed., Arenas of Strategic Thinking, Foundation for Economic Education, Helsinki Finland, 1991.

Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing here. To help disseminate these blogs, we also have a Facebook page and a LinkedIn page.

How National Happiness became gross

29 August 2018

The tiny kingdom of Bhutan, wedged between Tibet and India, became famous for coming up with Gross National Happiness (GNH), thanks to its king. This was not your usual king (see the photo). Before voluntarily ceding power to democratic elections, he decreed an increase in the country’s forest cover, had every child in the country learn English, and introduced Gross National Happiness.

The retired king of Bhutan with his four wives, all sisters. (Photo of a Bhutanese placemat.)

GNH resonated with people around the world who were fed up with Gross National Product (GNP). As Robert Kennedy commented:

The tiny kingdom of Bhutan, wedged between Tibet and India, became famous for coming up with Gross National Happiness (GNH), thanks to its king. This was not your usual king (see the photo). Before voluntarily ceding power to democratic elections, he decreed an increase in the country’s forest cover, had every child in the country learn English, and introduced Gross National Happiness.

The retired king of Bhutan with his four wives, all sisters. (Photo of a Bhutanese placemat.)

GNH resonated with people around the world who were fed up with Gross National Product (GNP). As Robert Kennedy commented:

Gross National Product counts air pollution and cigarette advertising.…It counts the destruction of the redwood…and the television programs which glorify violence.…Yet [it] does not allow for the health of our children, the quality of their education or the joy of their play.…It measures everything in short, except that which makes life worthwhile.1

GNH was based on four “pillars”: good governance, sustainable development, preservation and promotion of culture, and environmental conservation. These were elaborated in nine “domains,” which included health, education, psychological well-being, and community vitality. Simple enough.

Curious about this GNH and loving mountains, I visited Bhutan in 2006. Two things struck me in discussions with a number of the country’s knowledgeable people. First, they had no idea how to measure much of GNH; second, this didn’t much matter because the country seemed to be behaving true to its precepts. As a BBC reporter put it, GNH had become “a way of life” in Bhutan—a poor country where life seemed to be rather pleasant.

Not long after this, economists descended on Bhutan to fix GNH, even though it wasn’t broken. After all, if the Bhutanese didn’t measure GNH, how could they possibly manage it? Soon each of the nine domains had “its own weighted and unweighted GNH index…analyzed using…72 indicators.…Mathematical formulas have even been developed to reduce happiness to its tiniest component parts.”2 One survey, which took five to six hours to complete, “included about 750 variables.”3 These technocrats attended to the gross all right, but how about the happiness?

Critics of GNH have challenged its subjective judgments. “Economics professor Deirdre McCloskey criticizes such measurements as unscientific…making the analogy that society could not ‘base physics on asking people whether today was “hot, nice, or cold.”’4 If only education, culture, and happiness were as measurable as the temperature. I wonder if the greater threat to GNH has come from the enemies who want to eradicate it or the friends who want to measure it.

In 2013, not long after all this measuring, Tshering Tobgay, who had studied with economist Michael Porter at Harvard Business School, became prime minister. Soon he was claiming that GNH “distracted [some people] from the real business at hand,”5 namely “the bottom line…that we have to work harder.”6 This he could understand, in contrast to GNH, which he found “very difficult,” in fact, “complicating stuff for me.”7

F. Scott Fitzgerald claimed that “the test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function.”8 To any economist or prime minister who cannot handle measurement and happiness at the same time, let me suggest that you drop the measurement and celebrate the happiness.

© Henry Mintzberg 2018. To appear in “Bedtime Stories for Managers” (Berrett-Koehler, forthcoming in February 2019); a similar version appeared in this blog on 25 September 2015.  Our International Masters Program for Managers (impm.org) is for those managers who can function holding two opposed ideas in mind at the same time.

Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing here. To help disseminate these blogs, we also have a Facebook page and a LinkedIn page.

____________________________________

1 Robert F. Kennedy, “Remarks at the University of Kansas” (speech, Lawrence, KS, March 18, 1968).

2 Seth Mydans, “Recalculating Happiness in a Himalayan Kingdom,” New York Times, May 6, 2009.

32010 Survey Results: Results of the Second Nationwide 2010 Survey on Gross National Happiness,” accessed August 4, 2018.

4 “ACM: Cultural Marxism: The Highest Stage of RW Brakin’ 2 Eclecpapertic Bugaboo,” Daily Kos, March 22, 2015.

5Bhutan’s ‘Gross National Happiness’ Masks Problems, Says New Prime Minister,” Telegraph, August 2, 2013.

6 Gardiner Harris, “Index of Happiness? Bhutan’s New Leader Prefers More Concrete Goals,” New York Times, October 4, 2013.

7 “Bhutan’s ‘Gross National Happiness’ Masks Problems.”

8 F. Scott Fitzgerald, “Part I: The Crack-Up,” Esquire, February 1936 (reprinted March 7, 2017).

“Marketing Myopia” Myopia

15 August 2018

Years ago, Theodore Levitt, a marketing professor at the Harvard Business School,  published a popular article entitled "Marketing Myopia." Many people in business today, despite not having read the article, subscribe to the idea. It is that companies should define themselves in terms of broad industry perspective rather than narrow product position. To take Levitt's favorite examples, railroad companies were to see themselves in the transportation business, oil companies in the energy business.

The idea was a good one—like all good ideas, within reason. Why not open up perspectives, beyond existing positions: fast food beyond hamburgers (McDonald’s), delivering packages beyond selling books (Amazon), offering unassembled kitchens beyond unassembled tables (IKEA). Just so long as the competencies of the company are respected.

Years ago, Theodore Levitt, a marketing professor at the Harvard Business School,  published a popular article entitled "Marketing Myopia." Many people in business today, despite not having read the article, subscribe to the idea. It is that companies should define themselves in terms of broad industry perspective rather than narrow product position. To take Levitt's favorite examples, railroad companies were to see themselves in the transportation business, oil companies in the energy business.

The idea was a good one—like all good ideas, within reason. Why not open up perspectives, beyond existing positions: fast food beyond hamburgers (McDonald’s), delivering packages beyond selling books (Amazon), offering unassembled kitchens beyond unassembled tables (IKEA). Just so long as the competencies of the company are respected.

Many firms had a field day with Levitt’s idea, rushing to redefine themselves in all kinds of fancy ways—for example, the mission of a ball bearing company became "reducing friction." It was even better for the business schools. What better way to stimulate the students than to get them musing about how the chicken factory could be in the business of providing protein, or garbage collection could become beautification? Unfortunately, it was all too easy, a cerebral exercise that, while opening vistas, could detach people from the mundane work of plucking and compacting.

Often the problem came down to extravagant assumptions about the intrinsic capabilities of a company—namely that these are almost limitless, or at least highly adaptable. A prominent writer on strategic planning suggested, in apparent seriousness, that "buggy whip manufacturers might still be around if they had said their business was not making buggy whips but self-starters for carriages".1 But what in the world would have enabled them to do that? These two products shared nothing in common—no material supply, no technology, no production process, no distribution channel—save a thought in somebody's head about making vehicles move. Why should starters have been any more of a logical product diversification for them than, say, fan belts? "Instead of being in transportation accessories or guidance systems," why could the buggy whip manufacturers not have defined their business as "flagellation"?2

How can a few clever words on a piece of paper enable a railroad to fly airplanes? Levitt wrote that "once it genuinely thinks of its business as taking care of people's transportation needs, nothing can stop it from creating its own extravagantly profitable growth"3 Nothing except the limitations of its own distinctive competences.

Levitt's intention was to broaden the vision of managers. At that he may have succeeded—all too well. By elevating strategy from past position, to new perspective—from place on the ground to that in some stratosphere—he may have reduced its depth. Market opportunities got elevated past internal strengths. Products ceased to count (railroad executives defined their industry "wrong" because "they were product-oriented instead of consumer-oriented"), as did production ("the particular form of manufacturing, processing, or what-have-you cannot be considered as a vital aspect of the industry"). But what makes marketing intrinsically more important than product or production, or, for that matter, Ludvig in the laboratory? Companies have to build on whatever capabilities they can make use of, without being overwhelmed by weaknesses that they never considered, marketing ones included.

Critics of Levitt's article have had their own field day with the terminology, pointing out the dangers of "marketing hyperopia," where "vision is better for distant than for near objects"4, or of "marketing macropia," which escalates previously narrow market segments "beyond experience or prudence".5 I prefer to conclude that “marketing myopia” has often turned out to be myopic.

 

© Henry Mintzberg 2018. An earlier version of this appeared in my book The Rise and Fall of Strategic Planning, which Tom Peters called “my favorite management book of the last 25 years…no contest.”

Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing here. To help disseminate these blogs, we also have a Facebook page and a LinkedIn page.

_______________

G.A. Steiner, Strategic Planning; What Every Manager Must Know (New York: Free Press, 1979).

Heller, quoted R. Norman (1977) Management for Growth, New York: Wiley (p. 34)

T. Levitt ,“Marketing Myopia.” Harvard Business Review  (July/August 1960, p. 53)

P. Kotler and R. Singh, “Marketing Warfare in the 1980s.” Journal of Business Strategy (Winter, 1981:30-41).

5 J.P. Baughman, Problems and Performance of the Role of the Chief Executive in the General Electric Company, 1882-1974 (working paper Graduate School of Business Administration Harvard University, 1974).