How future focused is your executive leadership team? According to Rita McGrath, and often quoted by Alexander Osterwalder, two of the leading management thinkers of our time, if a CEO is not spending between twenty and forty percent of their time thinking about the future, rather than the day to day, operations of their business, they are merely paying lip service to the often-expressed desire to become an innovative company.
A previous post covered the need, and a range of options, for organisations to implement a contextually appropriate innovation operating model in order to successfully pursue and execute their innovation strategy. But, as noted, having the right innovation operating model is but one part of the puzzle and in this post we’ll focus on another vital ingredient - visionary leadership.
It is well documented that a pre-requisite for corporate innovation effort to bear fruit is demonstrable top-level support. Yet research routinely reveals that, in the majority of organisations, the proportion of time allocated by senior executives to developing their thinking about the future potential, or the opportunities for disruption, of the companies they are steering falls short of this.
I recently had the opportunity to hear from and meet Michael Wilkens, one of the first people to adopt and apply Osterwalder's prototype Business Model Canvas in a corporate setting. Michael is now the Chairman of more than a dozen European companies and a passionate business model innovator. In Michael's experience, most boards spend eighty percent of their time focused on providing financial oversight and ensuring adequate resources; on legal compliance and risk management; and on monitoring and evaluating the performance of the executive team. Just twenty percent of their time, at best, is allocated to establishing a vision and a strategic plan.
Further, most currently serving board members attained their positions after demonstrating their capability at operating businesses through prior decades of relative macro-economic stability. They demonstrated their prowess at exploiting the established industrial business models of the companies they helped to steer or helmed. They did not become board members by exercising their imagination, nor by exploring the future, and certainly not by taking risks with new business models.
But we are no longer living in stable macro-economic times. And for risk tolerant entreprenurs presents exciting opportunities to harness new technologies and launch new businesses. In today’s volatile and uncertain operating environment, the role of board members and the CEO must be to ensure that the people within the business are enabled to develop the explore mindset of startups. Specifically, they must be enabled to explore the potential and demand for new business models that will enable them to prosper in any of the multiple futures that scenario planning might illuminate. For this you need leaders prepared to explore beyond what has worked for them in the past, to exercise curiosity and imagination, and to develop their strategic peripheral vision. Michael argues persuasively for the need for boards to dramatically invert that 80/20 time allocation.
For all of us, and particularly for senior leaders, carving out a greater proportion of your working hours to create the physical, virtual and head space for immersion in the new technologies and other drivers of change has become essential. Developing a real understanding of the strategic potential of new technologies, and of the impacts and implications of the macro trends and megatrends is key to de-risking the future of any organisation.
And, given the industry-spanning nature of today’s ecosystems, and the complexity of the challenges, immersion is only truly effective when it is a shared experience that generates integrative, collaborative thinking about the futures that these new technologies are enabling and societal expectations demand. Collective immersion is the key to surfacing diverse perspectives, inspiring better questions, and accelerating their systematic exploration if we are not to continue to see a decline in the lifespan of corporations.
Participation in shared experiences amplifies human connection, fast-tracks breakthrough thinking, and fosters ongoing ecosystem collaboration. Leading multi-national organisations invest heavily in immersive programs that comprise a variety of elements. What successful programs have in common is a focus on facilitating regular, experiential learning opportunities and knowledge exchange across their ecosystem backed up by access to platforms that provide for ongoing learning and engagement across their organisations as the landscape shifts. In rapidly changing times, organisations who view immersion as an annual exercise will be left behind by those who nurture a focus on continuous foresight, enabling pursuit of an agile innovation strategy.
If you would like help to developing a program for your organisation that enables collective strategic foresight, please get in contact.