ep 23 Peter Compo long term strategy competing visions EXCERPT

It's the Jump Leap Long Term Podcast, Episode 23. You are in the middle of a strategic planning retreat. Your colleagues have come up with some great ideas for the future and have put together several interesting alternatives. That was the fun or the easy part. Now you must decide which ones to proceed with in a limited time, and no, you can't do all of them. But how can you compare them one against the other so that you can make a very smart decision? They each have different sub-strategies, so this is an important choice about the destination and the reason why it should be pursued. The retreat can't progress without making some difficult decisions. Tune into this episode to hear from me and my special guest, Dr. Peter Kompo, as we tackle this wicked problem together. I'm Francis Wade, and welcome to the Jump Leap Long-Term Strategy Podcast. And welcome back. And as you can see, I— we're joined by our special guest, Dr. Peter Kompo. And before I introduce Peter, I'd like to say a big welcome to you if you have never listened to this podcast before, especially if you've not listened before, because you may ask, you know, what kind of podcast is this? This doesn't sound like what I'm used to. Well, the differences are— I don't know if there are many, but they are intentional in that I've not invited Peter to come on and be my subject, uh, in terms of having an interview. Instead, we're going to be trying to solve one of the most difficult problems when it comes to defining strategy. The choice between alternatives. And the way we're going to go about doing this is by doing a heck of a lot of diagnosis of the issue, following the Einstein dictum, where Einstein said that he had an hour to solve a problem, he spent 55 minutes trying to solve the problem and 5 minutes thinking about the solutions. So Peter and I are going to go back and forth, tearing the problem apart. And part of why we're doing this is so that you our participant or our audience or listener can hear our reasoning. You may not agree with all of it, you may like bits and pieces of some parts and not the others, but you're going to hear some of the thinking that we are applying to this particular issue long before we get to what we think the answer might be. And, you know, for problems like the one that we're dealing with today, there are no sort of final answers. So our objective is to sort of arrive at some serendipity. And what I mean by serendipity is that one of us says something that neither the other one has not heard before, sounds brand new, and then we'll ring an insight bell, which means that, ah, we have bucked up on an insight or an interesting point of view that's fresh. Perhaps maybe we'd even find a few that no one has ever heard before. Ever, ever on our planet. So to cue us up, let me tell a quick story about Arturo. So he happens to be the CEO of a mid-sized company. He's in the middle of a strategic planning retreat, and the team has crafted 4 separate descriptions of the organization's future. Each one is made up of words and numbers, and they describe an outcome all the way in 2040. It's been a fun process so far, lots of brainstorming and back and forth and kind of conversation that bright, bright smart people like to have with each other. But now the team must choose between the alternatives, and so far it's been slow going. These 4 alternatives are distinct, but there is some overlap between them. In a prior retreat several years ago, he remembers that the team combined two alternatives into one, and it was a nice compromise. However, in this situation, that's impossible. The four future visions can't all be pursued at the same time due to limited resources. Plus, there are some conflicting ideas between them. Fortunately, the discussion has not been too heated because no one seems to be defending any particular vision. Yet there is a growing sense of impatience. So he slips a note to the facilitator—his name is Jorge—and says, "What can we do to speed this up?" Jorge looks at him with nervous eyes because he doesn't know. He looks as if he hasn't seen this situation arise either. But in both of their minds separately, they have the same thought. There must be a better way to resolve this than just continue an open-ended discussion of opinions, because we have an hour or two left before we need to move on, get this thing done. So Peter Kompo is the author of The Emergent Approach to Strategy— awesome book— with a background in music and a PhD in chemical engineering. He spent 25 years at E.I. DuPont in a wide range of leadership positions. His mission is to create a new level of strategy theory and practice. Peter, welcome to the show.

Good to be here. Did I forget to add one word in the end there? A new level of theory and practice, strategy theory and practice clarity.

Ah, no, yes, you did, you did forget. You gave me that bio, didn't have the word clarity in it, but sorry, that doesn't make a great deal of sense. Uh, what do you make of the Arturo case? Let's start, let's just jump right in.

Well, I make, I make of Arturo's situation that, you know, on a few levels he's got a few issues, right? He's got to convince his team that there's a connection between the future and their decisions today and what they're thinking about doing today. He's got to find a way to connect them and get them excited about that and get them feeling that tension. And there may be different cases. He may not know it himself. He may just believe it, but he has to find it, and he's looking for the team's help to do that. And maybe— yeah, sure.

Sorry, I was just going to jump in and qualify that a bit. Let's, let's take the pressure off you just a touch. Sure. Say, let's assume that they are, they are excited and they do see a connection between a theoretical future. So they like future building, this team does, and they see a connection between the decisions that they make and the future that's coming. So let's assume that's a given, because I, I And by the way, folks, if you're listening, you've been in retreat, you know that's not a given, because half the room could think that this is a waste of time. The other half could be all into it.

Most of the room could think it's a waste of time. Absolutely.

It gets really hairy in there. But let's assume that that's not the case. Um, so let's, let's put, let's put that one to the side and say they are, they are invested. Um, but let's— okay.

You said something important. They have four concepts for the future. And Arturo realizes that there's no realism in just accepting all four. Resource constraints could even be conflicts between them in the market, could be conflicts in the brand and in, you know, direction of the company. But he believes that, right, that the four are not acceptable to be just accepted as a four-part approach to the future. So he has that challenge. And it sounds like he's got the goodwill of the people to work it out. So it's technical. It's a technical problem. It's a real, how do we diagnose this problem?

Then? Well, it, it, let's say it's— he has the goodwill, so they, they've been following along because, you know, they've done the easy stuff. You know, in a way, the brainstorming is the easy part, but there's a lot of strategies out there that look like, you know what you say in your book, they look like a list of good stuff, and it's like everything under the sun is thrown into the basket, and there's no choices or decisions made as to priorities, or— and there's certainly not that, okay, we're going to do A and we're going to kill D, so D is now dead, and anything to do with D we'll never pursue, and we're not going to put any budget behind it. So that kind of clear, definitive kind of outcome is— I don't know if it's rare, but I see a lot more strategies when I walk into companies and look at their existing strategies that looked like that list of everything under the sun, that, that, and, and there's no coherence, there's no attempt for it to be coherent, there's just kind of a, you know, kind of what they, uh, what Arturo experienced before, which was just, well, let's just compromise and do all of them. No, I kind of like that. Let's put on a, let's put on a show kind of Mickey Rooney kind of thing.

Maybe, yeah, maybe every 9 out of 10 quote strategies that I've ever seen are lists of subgoals, plans, initiatives, strategic initiatives. What's a non-strategic initiative, by the way? I don't know what a non-strategic— so I don't know why we need the word strategic. They're mostly lists. It's easy to write down lists. It makes everybody feel good. Everybody got their bullet point up there, but, um, hope you're enjoying this free excerpt from the Jump Leap Long-Term Strategy podcast.

Interested in finding out more about getting a subscription to full episodes? Visit www.longtermstrategy.info.

The problem is that there's no, there's no integration, there's no challenge to resource constraint there's no thought about how these various programs conflict in the marketplace and, and how they confuse the brand and how they confuse the organization. So I think that's a given that, uh, that the list, uh, is not the answer, but even you're set up with the 4, you know, someone could say, hey, look, why can't we have 4 major initiatives in our company. I don't deny that that's a possibility, but have they really looked? Have they really seen whether there's resource constraints between the 4? Have they seen whether or not there are conflicts between them? Confusion in the marketplace, putting too much burden on organizations to have to serve multiple masters. I think it's very unlikely that a company with one group, let's say, you know, with one organization is going to have 4 equal programs going forward. Don't rule it out, but I would have to be shown how they all make sense together and that actually the strategy would be the higher level thought, the higher level rule that brings them together and makes them all work together.

All right, let me complicate things then. Okay, well, why not? So it's, it's the case that they are at the level of complete— not complaining, but they're, they're about to contend between 4 different outcomes. So the, the, it's the aspirations that are in contention. So below that, of course, there's the programs that support the aspirations, but they haven't yet agreed on the aspiration or the goal or the outcome. They have the four of them kind of sitting there, and they all have their pet outcomes, and they have their pet initiatives that support those outcomes, and they're used to thinking about the initiatives, because people, you know, people in companies think more about initiatives than they do outcomes. They think about what they're doing rather than the end goal. That's more like the CEO's job, or it's the board's job, or it's somebody else's job. But now it's their job. And we're saying they have to choose between the outcome as well as the initiatives to support it. So it's, it's harder in a way than— because you could fund an initiative thinking that, oh, we'll just throw money at it because, you know, it's just money and it's people and it's time. And, you know, you could just decide to throw some resources at it and kind of waste, you know, take one for the team and three you really care about, the one you really don't, but to keep the peace we'll do that one as well to keep people happy. But you can't quite— well, I guess you could, but you can't quite do the same trick if you're at the level of competing aspirations, can you? Or tell me, tell me your thoughts.

Obviously, we're talking abstractly. We don't have specific aspirations that we're discussing. But Often, you know, there, there is an overall goal, an overall vision of the organization, and that there can be sub-aspirations as part of that and sub-goals, but there would have to be proof that they all work together, that they are, uh, that they are sensible together, and that that they're realistic and reasonable. So there's a whole process there to think about that.

Right, right. So that's what we're hoping to tackle today, which is what's the way that we could help Arturo and his team decide which destination is the one that is worthy of you know, worthy of investment, worthy of emotional commitment. You know, it's one thing to want the retreat to be a success. It's another thing to say that success must be a particular outcome, because, you know, you really do need to walk into these situations being open to what might happen because of the group dynamic. The group dynamic may take it to a different different kind of aspiration than the one the CEO had in mind. And I've seen that happen before, the CEO or anybody else, but focusing on the CEO, you know, he or she has something in mind that they think should be the ultimate. And it turns out in the conversation that that doesn't really turn out to be the ultimate, which means that they know, you know, do they force what they want? Do they engage in a conversation back and forth in which both, all parties are open to something better emerging, something like jazz, or do they kind of drive it in some way or do they try and build a coalition? These are all the questions and there's no real answer to the right way to do it, but it has to be done. Because there's no way to make progress without leaving the retreat or leaving the discussion with having everybody on the same, on the same page. And I think the— just, just being in Arturo's shoes as he's watching the conversation unfold or not unfold, there's some anxiety. Um, I've also experienced top executives being pretty impatient about wanting to get to the answer and maybe get to the answer quickly because they don't want a lot of kind of navel-gazing and beating around the bush. Um, and maybe ultimately, you know, there should be a way to compare these alternate pathways with each other in a way that, um, is at the same time logical but also takes care of the social side of things. So that you don't— like, you don't call for a vote, for example, and the majority just dominate the rest, and, oh well, bad luck, you're the losers today. And by the way, this will show up in your resume. This will be in your record that you voted for the wrong solution. How do I— what does that sound so far, Peter?

I think what you've done is raised— you've What you've done is, is thrown out several possible scenarios, cases that a leader could be in. I mean, the leader, Arturo, may not know the answer, may be truly unsure of what's the right thing to do, and is looking for the group, right? Looking for the team to bring thought and, and help to answering the question. It may be he has an agenda and he's looking to, you know, he wants to, he wants to lead everybody to believe that they were part of the decision, but he's trying to get the, you know, agenda to go through. I mean, it can be he has a belief about what's right but wants it challenged. There are a lot of cases that, that this could be, and I suppose there would kind of be different approaches for each one of those different, different cases. I mean, I think the ones that, that's the most interesting is Arturo has thoughts about, you know, what's right, but wants them challenged, wants the team to feel involved, wants the best possible output. And that means creating a dialogue that's hard.

You've reached the end of a complimentary clip from the Jump Leap Long Term Strategy Podcast. To hear the full episode, go over to www.longtermstrategy.info and grab a subscription or a free trial. See you there. And here's a clip from our next episode with Dan Bruder.

Yeah, and, um, you know, we have to ask the question, um, why don't we include employees in this process? And there's a lot of different answers to that. One answer is as simple as we don't really respect our employees or their opinions. We think we know it all. And that goes to the thing you said, kind of the executive elite category. And, you know, strategy is too complex and it's too important for everybody except for the top, you know, 10, 15 people in the company. That's one reason. The other reason is, is it's, it's not impossible, but if done correctly, it's very, very expensive.

And if you like the work we're doing, feel free to follow us at our website strategyconf.fwconsulting.com or like or leave a comment on one of the popular podcast apps such as Stitcher or iTunes. This is Francis Wade, and I'm signing out from The Jump Leap. Long-Term Strategic Planning podcast. See you later.