Noah Barsky PhD

Growth should be exciting, but, if not properly governed, can generate much apprehension, tension, and noticeable reluctance. The antidote to organizational inertia, unmet goals, and related career plateaus hides in plain view – business acumen. While most employees are adept at tasks and responsibilities, many often cannot articulate why their work is important.

Enhancing business acumen about how the organization competes, performs, and utilizes key resources holds the key to maximizing employees’ talents and functional expertise. Knowing more about the business sparks curiosity, illuminates job relevance, builds a success culture, and can motivate commitment to previously unimaginable levels of achievement. For those who expand, hone, and renew business acumen, results follow and career trajectory soars.

What are business acumen essentials? Senior leaders and executive program participants most often identify and agree on these four fundamentals:

START WITH A CLEAR AND UNIFIED UNDERSTANDING OF STRATEGY

Business strategy can simply and clearly be defined in terms of how a company creates customer value and differentiates itself from the competition. Frequently lost in a buzzword morass, strategic insight starts with clearly identifying the existing and emerging competitors, not only by name, but size, strength, and intentions. Coupling competitive intelligence with insights about existing and prospective customers provides the key elements of credible market presence. Most importantly, strategic clarity reinforces why employees’ work matters and provides an unambiguous reference for business planning, review, and evaluation.

RECOGNIZE THAT RISK IS EVERYONE’S RESPONSIBILITY

Risk is often considered to be solely the domain of compliance, legal, and human resource professionals. While, as a minimum, companies should certainly abide by laws, meet regulations, and honor policies, risk avoidance, and mitigation are insufficient for a lasting, thriving enterprise. Business, at its essence, is a risk-seeking and risk-taking endeavor. Employees must understand the external and internal risks that their organization faces and the necessary actions to manage each (and those that emerge) as the entity navigates its competitive market. The foundation for understanding business risks resides in understanding a firm’s value chain and its purpose in strategy execution. Regardless of the method, good governance stabilizes growth.

REALIZE THAT MONEY IS THE REWARD NOT THE REASON

Employees must, in some way, have a concept of their company’s financial condition and the consequences of (in)actions. Without necessarily becoming a CPA or financial analyst, those with a basic awareness of their employer’s financials relative to prior years, competitors, and budget, have the perspective required for sound economic choices.  The company’s sales growth, profitability, cash flow flexibility, debt service, and overall financial viability either enable or restrict activities and initiatives. Profitability is imperative to reinvest in the business, increase wages, sustain operations, and maintain access to capital.  In top organizations, the finance function stewards scarce resources and works cross-organizationally with informed leaders who must spend and invest wisely for short-term needs and future well-being. Business choices require due financial consideration – from all.

MANAGE THE BUSINESS, NOT THE METRICS

Well-run businesses, exceptional employees, quality offerings, and leading technology score well on any scale. In an era of data abundance, companies need professionals who can focus the workforce on metrics that truly matter – those that drive meaningful outcomes, not simply tabulating quantifiable outputs. Performance measurement is essential to calibrate business decisions,  but should never be an isolated obsession. Those who advocate to make numbers “look good” can descend down a dangerous path of “form over substance” with incentives to manipulate, misreport, or worse. Performance measures, chosen with care and courage, offer candid insight into a company’s progress on strategic priorities, as fulfilled by operational excellence helmed by trusted leaders.

On scales of 1-10, ask yourself and others how well your workplace fares in terms of insight about strategy, risk, finances, and performance measurement. The answers reveal the areas of greatest strength and opportunity. Take action to improve ratings by just one point on each scale and marvel at how employees find more purpose in their jobs, energize the workplace, and perform better. Business acumen is the oft-overlooked differentiator that can enable you and your colleagues to deliver growth that your organization expects and deserves, and, even more importantly, because its future and your career depend on it.

ABOUT NOAH BARSKY PhD

Noah P. Barsky, PhD, is a professor at the Villanova University School of Business. He has also been a faculty member with the Institute for Management Studies since 2001. Dr. Barsky serves on business advisory boards and delivers executive education programs for Fortune 100 companies, global professional services firms, and industry associations. He has authored five books and published over seventy articles in various academic and professional journals. To learn more about Dr. Barsky and view his upcoming IMS programs CLICK HERE.

CONSIDER THIS SCENARIO

ACME Corporation is implementing a new technology. 

  • Executive Eric exclaims, “We need this new technology to remain competitive!  Why is it taking so long?  Why aren’t my managers getting their people on board?”
  • Middle Manager Mary laments, “I’ve been directed to implement this new technology when we haven’t even finished our last major roll-out.  My staff just rolled their eyes at me when I announced the change, complaining about how they don’t have time to learn the new process with everything else on their plates.” 
  • Employee Eddie complains, “Here we go again. Another program of the year. We’ll outlive this change, just like the last one corporate tried to shove down our throats!'”

DOES THAT SOUND FAMILIAR?

Change challenges vary by organizational level. Those at the top, like Executive Eric, usually set the direction of the change and are most convinced of the need for it, but they tend to be isolated from many of the change’s direct impacts. Staff on the front lines, like Employee Eddie, are most removed from the rationale behind the change, but are often most directly impacted by it; an alteration in their behavior is usually a significant part of the change initiative, and they can thus appear most resistant to it. That means that managers like Mary – and perhaps you too – typically find themselves stuck in the middle, squeezed between these two levels, sandwiched between the edicts of their bosses and pushback from their staff.

WHAT CAN A MIDDLE MANAGER DO?

Managers can play a mission-critical role in leading change by helping their organizations overcome these all-too-common disconnects across organizational levels, which result in over 70% of major organizational changes failing to achieve their objectives. Here are ways to exert your influence and emerge as a powerful voice in leading change, which is a pivotal capability for a leader at any level across all industries today:

INFLUENCE UP

What you see depends on where you sit.  It can be easy to vilify senior leaders above you in the hierarchy, but they don’t know what they don’t know – and it’s your job to tell them. Why is the TV show Undercover Boss so popular? Because in every episode a CEO masquerades as a frontline employee and experiences how hard it is for good people to comply with the changes they must wrestle with. How can you step up to help your executives see that sometimes the emperor has no clothes, and that they may benefit from a new way to engage people in and equip people for new directions?

ALSO, INFLUENCE DOWN

At times managers can be as in the dark about the changes they are supposed to drive as their staff! Take control by proactively obtaining the information you need about the ‘they, why, what, who, and how of the change,’ so you are armed to deliver the message to your people. It can be tempting to join the naysayers, especially when you have so many legitimate concerns and such limited information. Remember that behind every complaint is a request, and strive to tease out the wants and needs, communicate what you unearth in a business language that can be acted upon, and challenge your team to step-up and be part of the solution versus the problem.

HERE’S THE BOTTOM LINE

The most important change leadership competency is courage – the courage to say what needs to be said in an authentic, transparent, professional and respectful way to help others up and down the organization appreciate the need for change, understand the barriers in the current state, and collaborate to invent a new path forward.

ABOUT BARBARA TRAUTLEIN, PHD

Barbara is the principal and founder of Change Catalysts, the author of the best-selling book Change Intelligence: Use the Power of CQ to Lead Change that Sticks, and the originator of the CQ® System for Developing Change Intelligence®. For over 25 years, she has coached executives, trained leaders at all levels, certified change agents, and facilitated mission-critical transformations – achieving bottom-line business and powerful leadership results for clients. She is gifted at sharing strategies and tactics that are accessible, actionable, and immediately applicable.

Dr. Trautein will be delivering 11 IMS programs on Developing Your Change Intelligence to Lead Critical Initiatives in 2020. To learn more about Barbara and her IMS programs CLICK HERE.

Dr. Jeffrey Kuhn

Through my university research on strategic leadership, and my advisory work with senior leaders over the past two decades, I have observed a strong correlation between a leaders’ ability to frame and pose profound strategic questions and their ability to think strategically. In other words, strategic leaders think in the form of questions—the ability to frame strategic questions and engage in strategic dialogue is a key dimension of strategic leadership.

Big-Picture Thinking

In my work with executives, I can generally gauge a leader’s ability to think strategically by the quality of the questions they pose. The strategic questions a leader poses are the outward manifestation of his or her internal thinking process and their general orientation to the business. Strategic leaders tend to be broad-gauge thinkers and wide categorizers. They ask big-picture questions that serve as an early warning system, so the organization doesn’t get blindsided by the future. Well-framed strategic questions help leaders make sense of complex market dynamics and patterns. The questions a strategic leader poses, whether they are spoken or simply reflected upon by the leader, are not designed to be answered on a point-by-point basis per se but are meant to marinate and produce a deeper set of questions that produce deeper understanding into market dynamics.

Types of Strategic Questions

Accomplished strategic leaders tend to have a broad repertoire of strategic questions for recognizing market patterns and assessing the strategic and financial health of the enterprise. 

Here are a handful of examples to illustrate:

  • What are the key trends and patterns in the broad market landscape and what threats and opportunities do they present?
  • How are industry and competitive dynamics evolving?  How is the basis of competition shifting and what are the implications for our business model?
  • How are customer lifestyles, attitudes, needs, and purchase and consumption patterns evolving? How will customer and economic value be created in the future?
  • What are the key trends and dynamics in our distribution channels?  What are the implications for our business?
  • What is the strategic and financial health of our organization?  What is the longer-term growth and profitability picture? What are our next-generation growth engines?
  • What new capabilities must our organization build to sustain its market leadership and capture emerging growth opportunities? How must our culture evolve?

Big-picture, enterprise-level questions such as these are central to the long-term competitiveness and economic viability of the firm and help a leader rise above the operational fray and maintain a strategic perspective.

Industry Disruption and Reinvention

Today, nearly every industry, from financial services to farming, is undergoing some form of disruption, transformation, or reinvention. Low-cost digital technologies have lowered barriers to entry precipitously, giving rise to new types of competitors and business models, creating an accelerating world that has quickened commoditization cycles and shortened corporate lifespans to where they can be measured in dog years. Paradoxically, the digital revolution has brought dramatic growth in strategic complexity—socioeconomic, geopolitical, technological, customer, channel, competitive, and organizational—placing immense cognitive demands on leaders. When scanning the external landscape for disruptive threats and emerging opportunities, leaders are unsure of what they should be looking at in the external landscape, let alone how.

Questions Are the Answer

As Gabriol, the 11th century philosopher noted, “A wise man’s question contains half the answer.” In simple terms, the better you are at framing strategic questions, the better you will be at recognizing the intersecting trends and patterns that create and shape markets.

As an organization matures from a fledgling start-up to industry stalwart, the field of vision often narrows, and the organization finds itself peering at the outside world through a peephole. Individuals undergo similar life-cycle changes as they grow and mature from starry-eyed children with boundless curiosity and imagination to buttoned-up executives who interpret the future through the prism of past experiences. Left unchecked, these perceptual filters become self-limiting and self-sustaining, suppressing the

long-term imaginative thinking that is essential to sustained value creation. This explains why, in incumbent firms, most growth opportunities are hidden in plain sight.

You will be amazed at what you can see when you wipe the residue of past experiences from your lens and scan the market landscape with the curiosity and imagination of a five-year-old. Subtle cues that are invisible to the naked eye will become crystal clear when you sharpen your ability to frame strategic questions and develop your strategic eye.

About Dr. Jeffrey Kuhn

Dr. Jeffrey Kuhn is a distinguished thinker, author, strategy advisor, and educator with expertise positioned at the intersection of strategy, innovation, growth, and organizational renewal and vitality—the work of strategic leadership. His work centers on helping senior business leaders develop the capacity to think and lead strategically in dynamic market environments undergoing profound change. He holds a doctorate from Columbia University and has served on the faculty of Columbia Business School and Teachers College, Columbia University. He is a founding member of the Strategic Management Forum and is a Fellow at the Royal Society of Arts. In 2017, Dr. Kuhn was inducted into Marshall Goldsmith 100 Coaches.

Dr. Kuhn is doing three more IMS programs this month. Learn more about them HERE.

Dr. Jeffrey Kuhn

Aspiring young leaders often ask me, “How can I learn to think and lead strategically?”  Normally, I smile and reply, “How do you get to Carnegie Hall?”  The answer is, of course, practice.  Lots and lots of practice.  That’s how you get to Carnegie Hall, and that’s how you learn to think and lead strategically.

Strategic leadership is a form of leadership that is future-oriented and broad in scope. It emphasizes building the organizational capabilities and culture that strengthen a firm’s competitiveness and its ability to create customer and economic value on a sustainable basis. Strategic leaders speak a language of growth and value creation, rather than cost-cutting and downsizing.

Role of Strategic Thinking

Strategic thinking is the engine room of strategic leadership. It’s impossible to lead strategically without the ability to think strategically. They are two sides of the same coin. Strategic leaders have an innate ability to recognize patterns and seize emerging growth opportunities in dynamic market environments and tend to have strong conceptual skills and immense creative capacity that is fueled by an insatiable curiosity, openness to new experiences, a vivid imagination, and eclectic interests.

Many leaders struggle with strategic thinking and regard it as an inborn trait possessed by members of the lucky gene club rather than a cognitive capability—a mind-set and muscle—that can be developed.  It’s is my belief, however, that with the right development experiences, working under the watchful eye of a master teacher/coach with expertise in enterprise-level strategic thinking and transformation, operationally oriented managers can develop the capacity to think and lead strategically in dynamic market environments that are undergoing profound change. I have watched scores of operationally oriented managers develop the capacity to think and lead strategically in my executive development programs.

Building Your Strategic Muscle

Here are some tips and development activities for developing your capacity to think and lead strategically. 

Read Business Journals to Develop a Repertoire of Patterns

Strategic thinkers are expert pattern recognizers. A leader learns how to think strategically one pattern at a time. Commonly recurring patterns in business include a disruptive threat from a new entrant, organizational decline and renewal, growth spurts and growth stalls, industry maturation and commoditization, and price wars that create a death spiral.

A great way to develop a repertoire of patterns is through reading business journals and case examples in business books. Most of the strategic leaders that I have worked with are voracious readers and lifelong learners. Reading periodicals like Businessweek or the Wall Street Journal is a great way to develop broad, cross-industry business acumen and a repertoire of patterns.

Develop Eclectic Interests

It’s also important to develop eclectic interests outside of your work environment to develop your creative capacity. It doesn’t matter what you pursue, whether it be music, art, or birdwatching. The key is to pursue an interesting activity outside of work that brings your innate creativity out of hibernation and allows you to look at the world from different perspectives.

Develop Networks Outside Your Industry

It’s also vital to cultivate professional relationships outside your industry in order to develop a broad, cross-industry perspective. Thinking outside the box requires spending time with people in different boxes. Industries become inbred over time, so it’s important to connect with “switched on” leaders outside your industry to gain fresh perspectives that you can apply to your organization.

Participate in Strategic Projects

Experience is by far our best teacher. One of the best ways to develop your strategic thinking skills is by participating in enterprise-level strategy projects at your organization. You can also ask a senior-level mentor to shadow and/or support he or she on a shorter-term strategic project. During my doctoral studies, I worked with a retired CEO on strategy projects in an apprenticeship-type arrangement to hone my strategic thinking skills. The experience accelerated my development immeasurably and continues to bear fruit.

Maintain a Strategic Thinking Journal

Finally, it’s a good idea to maintain a strategic thinking journey to capture your insights, observations, and reflections.  Nearly all the executives I have worked with over the years maintain a journal to capture key insights.

Enhancing your capacity to think and lead strategically is clearly within your grasp provided you have the passion and drive and are willing to invest the time to hone your craft.  There are no shortcuts in life.

You have to practice, practice, practice!  That’s how you get to Carnegie Hall!

About Dr. Jeffrey Kuhn

Dr. Jeffrey Kuhn is a distinguished thinker, author, strategy advisor, and educator with expertise positioned at the intersection of strategy, innovation, growth, and organizational renewal and vitality—the work of strategic leadership. His work centers on helping senior business leaders develop the capacity to think and lead strategically in dynamic market environments undergoing profound change. He holds a doctorate from Columbia University and has served on the faculty of Columbia Business School and Teachers College, Columbia University. He is a founding member of the Strategic Management Forum and is a Fellow at the Royal Society of Arts. In 2017, Dr. Kuhn was inducted into Marshall Goldsmith 100 Coaches.

Dr. Kuhn is doing four IMS programs in October. Learn more about them HERE.