18
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December 2020
3 minutes

Network instead of depth

Brings together what belongs together: people – methods – content

Strategic management in a VUCA world is the result of the interaction of many people. (Image: Bushko Oleksandr/shutterstock.com)
“Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window.” (Peter Drucker)

The high speed of change in many markets makes it clear how important it is to act as early and in a coordinated manner as possible when unforeseen events occur.

The opinion that we can forecast the future of our complex "ecosystems" with the help of sophisticated simulation models turns out to be a mistake. Drilling deeper via expert tools to predict the future more accurately just ends up getting it wrong more accurately. The prediction is and remains a black box with a credibility problem.

What helps us to deal with uncertainty?

It is a matter of recognizing and evaluating signals from the markets and acting in a coordinated manner at an early stage in order to make the organization as a whole capable of acting in the long term.

In complex organizations, this task can be mastered through the interaction and collective knowledge of many people. This requires a paradigm shift, namely a conscious increase in the density of networking in matters of strategic management:

1. People-Networks: Collaboration and participation

Bring the right people together for genuine strategic dialog: Collaboration and participation should be a matter of course throughout the strategy process – at a minimum, however, ensure targeted alignment at the neuralgic horizontal and vertical handover points.

This applies in particular to

a. the summary of the analysis phase (for example, in the form of a SWOT analysis and/or the prioritized challenges),

b. the end of the development phase, when options and submarkets are prioritized and the company's own core competencies and capabilities are reflected upon.

Involve central functions (e.g. HR, FiCo, R&D, ...) in the process as early as possible – at the latest during the development of market strategies, these cross-functional perspectives should be incorporated.

2. Methodoloy-Networks: from analysis to knowledge to action

Make sure that for each method used, the underlying assumptions and the insights gain are made explicit. A concrete action or input should be derived from the insights gain, which is methodically relevant at another point in the strategy process. Make sure that the essence from e.g. the analysis phase is further processed in further steps and strategic methods. In this way, you create consistency in content and traceability across the methods used in the process.    

3. Content-Networks: Thinking in scenarios

Forecast models can no longer represent the complexity and dynamics of the real world in a way that is comprehensible and guides action. They are replaced by scenarios – thinking in terms of possible future states. This is not about pure forecasts, but about a dialog-oriented process that helps to sharpen the potential success factors of the future business. By linking the right content from the strategy – qualitative as well as quantitative – future pictures emerge that we can work with and better adapt to possible consequences for our business. This sensitizes our antennae to the unforeseen and helps to better align our assumptions about the business environment.

“To make knowledge productive, we will have to learn to see both forest and tree. We will have to learn to connect.” (Peter Drucker)

Strategic management in a VUCA world is the result of the interaction of many people. Collaboration and participation are becoming a matter of course. We need to think our strategy processes end-to-end and relate the methods used to each other in a meaningful way. If we succeed in arriving at coordinated, common images and actions from the many sources and contents, then we will remain on a common course even in stormy times. Probably the greatest challenge of a future that has already begun ...

Your Ronald Herse

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