We are what we do, day by day. So excellence is not an act, but a habit. Aristotle.
Knowing how to look and act strategically in a company is a skill that, like swimming or cycling, cannot be acquired by reading books or articles.
You have to practice, fall, make mistakes and suddenly you walk or swim without knowing exactly what has changed, but mastering the subject. Sometimes we need a tutor to hold us by the bicycle until we make that click that changes our perspective.
That is why it is so difficult to explain, in theory, the best way to be an entrepreneur and then countless methods, laws, systems appear and they all seem to be correct - in fact they are - and yet not always applying them yields good results.
The problem is that each company - as if it were an individual - has a way of being and doing that is unique and unrepeatable, and generalizing with management practices can often be dangerous. What is good for one company is not good for everyone.
So ensuring that everyone has to do physical exercises daily to stay fit can be dangerous for many people.
What can be assured is that you have to do exercises according to your physical structure, your health, your age, your work and your life goals, and often the best thing is not to do any exercise.
The same happens with organizations, each one, according to infinity of variables (market, size, culture, technology, situation, etc.) requires different practices.
Thus, fashionable practices appeared that were successful in some companies and were disastrous in others (rezising, downzising, outsourcing, mergers and acquisitions, etc.), in all of them explanations of the failure were found after it occurred.
In my opinion, the ideal is to try to understand what is the essence of strategic thinking and, practicing it, try to exercise it.
When strategic thinking is understood and exercised, you can find out very quickly what actions are necessary for the success of any organization.
It is perceived which are the forces that are acting, what weaknesses the organization has, what corrective actions are urgent and which in the medium term, how it should change in the future to survive and if the organization is viable or not.
I will try to provide, in successive articles, tools so that they can be applied in order to develop that type of vision. Always insisting that the only way to acquire that skill is to practice it.
The first step is to understand that the company and the entrepreneur are part of a system, which in turn is made up of several sub-systems and that everyone influences everyone. Thus, a company influences the market in which it operates, offering new services or products, and in turn the market influences the company as it matures and demands another type of service / product.
The conjuncture - or environment - influences the market, in crises or stages of growth and the market influences the conjuncture if the inhabitants of a region start consuming because they have confidence in the future.
Perhaps it is useful to understand this concept by explaining that the human body is a similar system, it is also composed of several subsystems (respiratory, digestive, nervous, circulatory systems, etc.) and that a change in one of them influences the entire rest. Thus, to interpret a symptom, such as a headache, it is necessary to know how each of the sub-systems is working. Everyone understands nowadays that a headache can be the consequence of different causes: fever, liver, digestion, constipation, etc. And, to complicate things a little more, it can also be the consequence of an intangible subsystem like the psychological one, stress can cause headaches.
In the same way in the business world a symptom (falling sales, profitability, loss of market, constant problems, quality, etc.) can have several causes. This will depend on each company and the environment in which it operates.
A possible graphic representation of the company-entrepreneur system can be:
We are going to start now to see the interpretation tools of this system.
I intentionally place the entrepreneur outside the limits of the system because, despite being part of the whole, it is essential that he, himself, to understand how it works, look at him as a spectator.
The only thing the entrepreneur has the possibility of acting on is the company, and in this way make it act on the rest of the system, or make the necessary modifications so that it adapts to changes in the market and the environment.
The most common problem among entrepreneurs is to locate within the company itself and from there try to overcome difficulties, which are generally the consequence of several different causes.
This is what I call Business Myopia.
Entrepreneurs focus on the company and, although it is true that it is the only thing they have the possibility of acting, they do not take into account the rest of the system, so they often spend a lot of time, effort and money modifying or improving the product when in reality they have problems of distribution, economic situation, political situation, customers that have grown or chosen segmentation.
The only way to think strategically is to visualize and understand how this system works, for this I will try to give you tools to study each subsystem separately, and in turn interpret how they interact with each other.
I'm going to treat each subsystem separately to understand it, and then, in each one, try to explain how it interacts with the rest.
Businessman:
I am going to start with the entrepreneur since he is the one who with his actions has the greatest influence on the entire system. Although it has no influence on the market or on the environment, if it can change the company to adapt to the environment, which is the sole purpose of any organization, to survive.
The entrepreneur is an individual and, by definition, is a unique being. Each one has their own way of approaching life and doing things, their own paradigms and their own history that influences their actions and decisions.
Although we cannot generalize in terms of behavior, we can say that there are habits and ways of doing that are common to successful entrepreneurs.
We all have habits of conduct, according to our training, history, character, etc. And the only way to eradicate wrong habits is to replace them with new habits, and these have only one way of being acquired: practicing and exercising them.
Are those habits:
- Start with an end in mind. Pro activity. Time management. Think win - win. Focus on principles.
Start with an end in mind: to know if we are going in the right direction we must know where we are going. We must have a vision of what we want our life to be. An exercise proposed by S. Covey in "The 7 Habits of Highly Effective People" is:
Imagine that you are driving to a wake, when you arrive you realize that it is your own funeral and sit at the back of the room. Perceive that each of the present is going to say a few words about what you represented to them in their passage through this life. So each of the people who had contact with you will talk about it.
Imagine that you want your wife / husband, your children, your parents, your bosses, your employees, your suppliers, your customers, etc. to be told about you.
In each of those speeches you have a guide to conduct, a way of doing everything, a pattern for each decision.
This vision is totally independent from the vision of the company, it is for you as a person, the vision of the company is going to be one of the consequences of your way of thinking.
If you can, write each of the imagined speeches and keep them in mind so that fulfilling them becomes behavior habits.
Proactivity: There are three types of attitudes towards things that happen to us, passivity that is doing nothing, reactivity that is reacting when something happens and proactivity that is making things happen.
Acting proactively is a prerequisite for success in business management.
This is the essential quality that distinguishes us from other members of the animal kingdom. It is what makes us the architects of our own destiny. It gives us the freedom to choose our own response to environmental stimuli.
Exercising this habit along with the first of having an end in mind ensures the direction and cruising speed of our lives.
Time management: modern theories of business management ensure that today we are as we are as a result of decisions made in the past, so we have to make the right decisions today to forge a future. This habit allows us to prioritize what is important leaving aside the urgent. And what is important is set by our objectives.
S. Covey in the cited work, describes very well the elements of time management according to their urgency and importance.
Urgent Not Urgent
Important quadrant 1 quadrant 2
Not important quadrant 3 quadrant 4
Each of the events of every day can be framed within the graph. So:
If most of our activities are within quadrant 1 urgent-important, we are in continuous crisis, putting out fires, with stress, delays that cannot be postponed, events handle us.
In quadrant 3 not important-urgent, we react urgently to things that are not important to us, we are attending to third party priorities.
Many times we occupy our time in quadrant 4 not urgent-not important, as an escape from acting mostly in quadrant 1, when normally these tasks should be discarded.
When, exercising the first two habits, we manage to occupy most of our time in quadrant 2 important-not urgent we have the management of our time, we are planning, anticipating problems. Normally when something is not urgent we leave it for later, and we always live in quadrant 1.
Exercising this habit allows us to plan our actions and anticipate problems.
Thinking about winning - winning: Many entrepreneurs think that businesses are a zero-sum system, that is, if they earn, someone must lose, and they spend much of their time thinking about how to take advantage of the other party.
Businesses are, by definition, wealth generators of all kinds, so if we use our ability to make bigger cakes, instead of thinking about how to divide them, we will most likely get bigger servings on every slice we touch..
We must always think about the common good, this is possible even with the most direct competitors.
By generating bigger and more accessible markets to more people we are collaborating to the possibility of a better world.
Focus on principles: Principles are like beacons, natural laws that cannot be broken. The principles are profound, fundamental truths of universal application.
The rectitude, honesty and integrity that are the basis of trust are unquestionable for success. Quality, understanding that doing things with excellence generates a better world. Dignity and potential, understanding that we all have capacities and that we can grow.
The service that is to contribute to the growth of the other.
Says S. Covey: "I doubt that anyone can seriously consider bad faith, deception, baseness, worthlessness, mediocrity, or degeneration to be a solid foundation for happiness or lasting success."
The first tool to acquire strategic thinking is to work on yourself.
These habits will give us the possibility to follow a path at a certain speed to go to the place we set as our objective.
Most of the concepts about habits were copied almost verbatim from the book "The 7 Habits of Highly Effective People", I did not think it necessary to change or expand the concepts, you cannot improve what is very good.
In future articles I will give tools to understand the company, the market and the environment.
Bibliography:
The 7 habits of highly effective people; Stephen Covey ed. Paidos 1997
