One of the central problems all organizations face is balancing long term thinking with short terms needs. It is clear that time and resources need to be devoted to both; companies that live moment to moment don’t survive very long, while those that focus on the big picture without worrying about the details usually don’t live long enough for their vision to matter. So the question isn’t which is more important, the question is how to do both simultaneously.
The strategies :
- Ask everyone in the organization to simultaneously focus on long term vision and short term execution.
This is the most intuitively attractive answer. It’s the one that various business books and seminars recommend. And it would be a great strategy if it could be pulled off, but I’ve never seen it happen. Toyota might be a counter-example based on books I have read, but I’m guessing insiders could educate me about the ways in which it is difficult there as well. If you know of others, please comment.
The problem with this strategy in my experience is that firefighting always wins. No business I’ve ever seen has been willing to let a short term issue fester in favor of providing time for employees to think about the long term. “Oh, I’m sorry we just short-shipped out biggest customer…but we’re in a long range planning retreat this week so I’ll deal with it on Monday”. That sort of thing gets you fired at most companies. There’s no question which takes precedence.
Interestingly, I think continuous improvement as it is practiced today is part of the problem rather than the solution. Many companies now run so lean in terms of personnel that there is no excess capacity to fight minor fires, and everything becomes an emergency. At the same time, positions on the floor and elsewhere have been time-studied to death, so there is no extra seconds in the day to devote to long term thinking. Individual projects are optimized like crazy with very little though given to the whole. I know it’s not supposed to be this way, but often it is.
The answer to this is widely seen as the next strategy.
- Ask everyone to worry about long term vision and strategy at certain times, while focusing on short term execution the rest of the time.
Future state mapping is a great example of this strategy. You haul people out of their normal responsibilities for a few days to consider what the future state should look like. People who are practiced at this develop not only an ideal state, but a few interim states along the way as well. Then when the mapping is done, the team goes back to their regular jobs, which are usually execution focused.
The follow-on strategy often involves projects and/or Kaizen events. Both of those can work. Projects work by forcing project leaders (and sometimes their teams) to continue working towards a long term goal, balancing that with their short term responsibilities. In essence this strategy works by forcing the first strategy (above) to occur for some period of time. Because projects are inherently limited in duration, this can be successful. Kaizen events, on the other hand, work by forcing the second strategy to occur for some period of time. Both projects and Kaizen events function by preventing the natural tendency of an organization to focus on short term needs.
The problem with this strategy is that the short term and long term thinking usually become divorced from one another. The classic example of this is annual “Strategic Planning” (which goes by many names), wherein everyone works like crazy for a month or two to prepare an X-year plan and get approval for it up the chain. Then once that’s done, the plan it put away and never seen again. Everyone goes back to managing the short term. Projects and Kaizen events still occur – and may even help the organization –
but they are rarely explicitly connected to the broad strategic plan.
Recognition of this tendency is, I think, what makes the third strategy most common.
- Employ a few people to worry full-time about long term vision and strategy, while most others focus on short term execution.
This is a very common answer. Maybe the most common. Especially in corporations for which selling the product (or otherwise dealing with a customer) is resource intensive. Consider a retail chain, for example. If there are 1000 people working for the company, 900 of them might be on the sales floor selling products directly to customers. Another 50 might work in logistics (distribution, transportation, warehousing, etc), perhaps another 25 are support staff of some sort. On a good day, that might leave 25 people to think about long term strategy for the company. And not just standard business strategies like how to market, what to sell, and where to operate, but also things like how to attract and retain employees, where to hedge and where to spot-buy, and who to fire. Oh, and maybe how to run a continuous improvement program.
If you are part of an organization, you probably already know the problems that crop up here. In the example above, 25 people who are sitting somewhere other than the front lines are trying to determine strategy for the 975 who actually know first-hand what is going on. The ones who are closest to direct feedback and subtle shift are the ones least empowered to influence and select the strategy. It’s a set up doomed to failure for all but the most talented (and rare) of leaders. It’s a strategy that looks good in theory, but is devilishly hard to successfully practice. And even when you get it right, you’re not taking advantage of the knowledge and expertise of all those people out in the field.
The saving grace for this strategy, and the reason it is so common, is that it is a stable structure. Even if it isn’t a great strategy overall, it’s better than the other two because it is tenable. It is a compromise way for the organization overall to pay attention to both short term and long term thinking, even if no individual within the company is doing so. It survives and flourishes not because it is a great way of doing things, but because it is slightly better than the alternatives.
Is there a better way?