The attributes to successfully lead a company in the knowledge economy of post-capitalist society seem much more demanding than those of yesteryear: the demands of the environment seem greater and very different, as well as the types and mixtures of leadership eligible and what they require.
Far beyond the -progressive- approaches of benchmarking and continuous improvement of processes and products that have progressively faded images and decreased margins -and those more recent such as coopetence and hypercompetence, contradictory to each other- we found ourselves in a global world of innovation - radical - in products and businesses that generated distinctive images and unparalleled margins, in record time. Did this change what happened on 9/11/01? Apparently yes, and notably. The new type of confrontations under way is also generating new challenges and new ways to face them successfully, from which humanity will probably emerge strengthened and perhaps benefited: my appreciation is that innovation will accelerate everywhere and in all fields.Only those who keep up with the change will survive successfully: even - obviously - politically.
In any circumstance, to achieve and maintain sustained success it is not enough to have a desire to achieve it, it is also necessary to have a model of action of a guide that is widely adaptable to the circumstances. The action will lead with more quality, effectiveness and efficiency -that is productivity- to the achievement of the desired success, if it is guided by a systemic vision of what is to be achieved and how to achieve it, in different environments.
Achieving this also requires ingenuity and the ability to transcend the past and -from the present- to design, build and travel new paths and processes that allow us to successfully reach and be part of the desired future.
Without values, vision, method, ingenuity and energy, to face the complexity of current businesses - large, medium or small - she can cope with us and turn us into improvised firefighters extinguishing fires, more concerned with solving the urgent than busy with timely undertaking what important: this is radically innovating the way we do business.
The strategic leader now has more and better management tools, instruments, techniques, concepts, systems and philosophies than before, which are also more adaptable to different environments and situations.
Among them, the Strategic Management approach predominates, which - synthesizing more than 10 schools of thought (Mintzberg) - aims to make strategic managers more successful managers: this is to achieve that more often they achieve the objectives to be achieved. Recently, Hamel has drastically revolutionized the way we do this, showing unprecedented successes attributable to innovation in the way we do business.
The objectives and indicators or variables - keys - to measure success, must reflect a very high performance in the market, which generates prosperity and happiness: in good Creole, you are only successful and happy if you are not "peeling" (Barroso).
Typical achievements of success - at a global level - are high levels of Customer Satisfaction and other stakeholders, generators of positive, large and growing levels of Competitiveness, Productivity, Profitability, and Liquidity, with acceptable levels of debt and risk, which contribute to a positive, large and growing creation of Value.
The BSC or Balanced Score Card facilitates deriving from these objectives at a global level, concatenated objectives -interlaced with each other- at all levels. The BSC facilitates translating the innovation strategy into action, and appreciating the impact -on the creation of Value- of linking and balancing “key objectives to satisfy the needs and concerns of the main business partners” -that is (financial) shareholders., customers (commercial), workers (human, labor learning, improvement and innovation), suppliers (logistics) and citizens (community) - with "key objectives of excellence in internal business processes", to generate high levels of customer satisfaction. them (and with them).
It is from the financial perspective of the BSC that we can develop the Tree of Value in terms of EVA (Economic Value Added) and value levers, developing and managing -at different levels- BSC's with EVA and ABC (Activity Based Costing) with Opportunity Cost of Capital, ABB (Activity Based Budgeting) and ABM (Activity Based Management), to facilitate the design of Evaluation and Variable Compensation Systems based on EVA, which measure and promote the sustained creation of Human and Intellectual Capital (Kaplan, Stewart, Sbeivy).
If a strategic leader does not understand the meaning of the recently used terms, we can say that he is not up-to-date in terms of post-modern management technologies: the fact that these technologies exist and are at his disposal does not guarantee his dominance. As there is a wide and varied offer of virtual and traditional executive development workshops -even person to person- it is relatively easy for the leader to cultivate, update or re-empower -in the short term and at affordable costs- in the systemic and systematic management -successful - of the increasing complexity in business. This requires accelerated dynamic learning (Sánchez).
For a strategic leader of the 21st century, it is important to know - and preferably master - each and every one of the 12 steps that strategic management suggests to carry out, in order to advance innovatively, at a firm step - and with his own style - through the labyrinth conducive to full and sustained success.
1. Defining the Businesses in which you are and want to continue, and in which you are not and want to be, also specifying which businesses you do not want to be in, requires:
to. Segment, understand and ingeniously describe our main customers and consumers and those who could potentially become,
b. Segment, understand and describe with great insight the desires, needs and key concerns of all those, which it is intended to fully satisfy, c. Specify in a captivating way the best products (goods and / or services), to fully and sustainably satisfy the main needs and concerns - recurrently unsatisfied and bankable - of them, d. identify the optimal technologies to produce and / or market them, and. identify the optimal inputs, to produce them, F. identify the optimal channels to communicate and market, and
g. outline communication strategies, distribution, prices, presentation, customer service, etc.
2. Defining the Desired Situation or the Strategic Purpose to achieve, with ambition and in accordance with what we want to become (vision) and the ethical context within which we will act to achieve it (values), implies defining and linking both general purposes to to achieve sometime (objectives) as specific purposes to be achieved in certain quantities and dates (goals): “there is no favorable wind for those who do not know where they are going”, (Seneca). The BSC allows us to represent all this, summarizing the strategic design -in a strategic map- that facilitates the monitoring and strategic assurance of the management.
3. Carry out External Inquiries, formulating hypotheses about the relevant actors and the macro and micro business scenarios or environments in which the actions aimed at achieving the desired situation would take place, in the businesses of interest.
Based on the impact of events that have already occurred on demand, supply, prices, costs and other aggregate variables of the economic sector of interest, it is necessary to visualize the probable impact of prevailing trends and new uncertain events that may occur, in addition to make explicit the impact -on the same variables- of assumptions and premises (predetermined events).
In parallel, it is necessary to visualize the importance and the relationships of strength and power between the relevant actors of the economic sector of interest (competitors, substitutes, clients, consumers, suppliers, complementary, regulatory entities, etc., classified as loyal or unfair allies, opponents open or covert, indifferent recoverable or recalcitrant; conditional or unconditional) and their probable strategic moves in the face of macro-political, economic, social, technological, demographic, cultural, energy, etc., disjoint, plausible and probable scenarios.
The result will be the insightful identification of relevant Opportunities and Threats, to achieve the desired ambitious situation, with a value-generating network that expands the boundaries of the firm with suppliers, cooperators, strategic partners, coalition partners, etc.
4. Carry out Internal Inquiries: It consists of identifying and evaluating the key strategic means or resources (strategic assets, core processes and core competencies) that are needed versus those that we have, to achieve how much one wants (Goals) against the challenging ones visualized scenarios (Opportunities and Threats).
The idea is to identify - in front of Objectives and Goals, Opportunities and Threats - the means or resources that "are needed and not had" as possible Weaknesses, and identify those that "are needed and have" as possible Strengths, showing the gap existing, perspective by perspective of the BSC.
5. Design Core Strategies: it consists of designing how to achieve with what little we have and how much we need - in the face of the challenging environments that are looming - how much we want, in the businesses in which we are interested in winning.
This implies both a perceptive review and analysis of each and every one of the strategic business segments of interest (product / market pairs), and -for each of them-formulating or reformulating generic strategies of: abandonment, penetration and / or diversification, leadership due to costs and / or differentiation, product innovation, operational excellence or personalized attention, strategic purpose, hypercompetence, cooperation, strategic association, outsourcing and / or insourcing, forward or backward integration, conglomeration, internationalization, globalization, or radical innovation in the way of doing business (non-linear change in interface with customers (channels and support, information and insight, relational dynamics, prices), and benefits for customers (that add value and satisfy their needs, concerns, and desires),core strategy (products / markets, differentiation, mission), and configuration (combination and interrelation of resources), strategic resources (core competencies, core processes, strategic assets), and organizational boundaries (what to do and what not to do), and value network (suppliers, partners, coalitioners).
It includes - in line with the above and perspective by perspective - detecting strategic crossovers of Strengths and Weaknesses with Opportunities and Threats, and designing specific strategies -offensive, defensive, dissuasive, cooperative, and / or abandonment- to take advantage of Opportunities with Strengths or Weaknesses, defend ourselves from the Threats to which the Weaknesses make us vulnerable, reduce or eliminate the Weaknesses… or disrupt the Threats to which we are vulnerable with the Strengths that allow us, etc.
It also involves visualizing possible counter-strategies -offensive, defensive, dissuasive, cooperative and / or abandonment- of those we affect with our strategies, designing counter-counter strategies against them and / or - consequently - redesigning our original strategies and so on.
All of the above may lead to having to partially or radically adjust the Mission.
What is described in these first 5 steps summarizes -in a very compact way- the formulation of the strategic business approach (pen): the grand strategy, architecture, painting or strategic sculpture, in which leaders should immerse themselves body and soul, facilitating the conditions that encourage ingenuity, creativity, innovation and the willingness to assume responsibilities and risks by the majority of the company's constituents. The iterative review and adjustment of their results should be translated into a compact redesign of the strategic map represented in a BSC that predisposes to action and changes leading to the expected achievements.
The new business model must be unique, efficient, coherent and enriching: it must generate increasing returns - above the average - keeping competitors at bay, taking advantage of economies of scale, preserving strategic direction with tactical flexibility (Hamel).
In the following 3 steps we will describe strategic engineering, carpentry and accounting -before pompously called strategic planning- now simply called business operational planning (pon): activity to be undertaken and led -participatively- by all leaders, guided by the strategic approach of business and enriching it.
6. Formulate General Action Plans: involves designing -strategy by strategy, with a vision of totality and in function of time- the set of sequential and parallel activities that each and every one of the strategies requires, to be carried out successfully, in a challenging and harmonious climate; even the activities to budget and obtain the necessary and unavailable resources.
7. Formulate Specific Action Programs: it involves defining and estimating, based on time, each and every one of the necessary non-monetary resources versus those available, to carry out each and every one of the plans, including the resources to obtain the necessary resources and not available, in accordance with the previous step. It also involves estimating the unit costs per unit of time, of the necessary resources, whether they are available or not.
8. Formulate Strategic Macro Budgets: involves estimating - based on time and in full accordance with the previous steps - the impact of strategies, plans and programs on sales and income, and on investments, costs, expenses, interests, taxes and expenses. It also involves determining the financial impact of operations, investments, and financing on the net present value of the economic value added (van EVA), Cash for Shareholders (EPA), and Cash for Executives (EPE), etc. in accordance with the types and degrees of risk at stake. It also implies evaluating the financial and non-financial impact of the strategies for the formation of human and intellectual capital, in a manner consistent with the evaluation of performance, variable compensation and the award of excellence.
These first 8 steps are the ones that allow you to configure the Strategic Business Plan (PEN).
The following 2 steps describe -very briefly- 2 very important aspects of leadership, absolutely unavoidable and cannot be delegated, by strategic leaders who want to be successful; they are both adjusting the organization and energizing action.
9. Adjust the Organization, is to critically and constructively review the adequacy and ecological concordance of the components of the organization -with each other, with the environment and with the strategies, plans, programs and budgets that will guide the action towards the objectives- as part of the business system to lead successfully.
It involves concretely defining the guidelines to adjust the configuration and radically flatten the hierarchical and computing structure, to drastically update, debureaucratize and simplify the systems (including the rules and procedures), to ingeniously enhance the relevant symbols, rituals and myths that make it attractive and different, to promote by example and the level of demand, unrestricted respect for ethical values, to retain and effectively attract quality people in the necessary and sufficient quantity, to develop and competitively compensate the human, managerial, and technical skills required, to clearly assign responsibilities for the achievement of objectives and goals,and to appropriately allocate the required resources both to assume individual and collective responsibilities and to reward -with valuable incentives- their successful assumption (transactional leadership).
10. Dynamize the Action: implies both incentivizing and coordinating and leading the action -in a coherent way with what was previously planned and organized- to successfully achieve what was sought. This requires skills to generate -with emotional intelligence- moods and emotions that predispose people to carry out the necessary actions -to achieve efforts and results that exceed expectations- in a coordinated way, with joy and energy beyond expectations..
This requires from the leaders special skills both in business coaching and coordination of actions and in strategic leadership (transactional + transformative).
The competencies of the leaders in BUSINESS COACHING allow them -among many other things- to seductively communicate vision, values, strategy and action, make them known in detail, make them fully understood, and share them emotionally, in order to be able to passionately engage everyone and each one- in the sustained achievement of a very high degree of compliance, which -once achieved- generates great trust in -everyone and everyone- and makes them feel -with foundation and at all levels- as highly reliable teams.
The leadership competencies in COORDINATION OF ACTIONS facilitate the process of: detecting in advance needs and concerns to be satisfied; explicitly decide which ones and when to require them to be satisfied; convincingly contextualize about it with candidates to satisfy them, before asking them to satisfy them; promptly request their satisfaction, specifying the required satisfaction conditions; effectively negotiate conditions, postponements, negatives, etc. that they raise; effectively compromise the mutual fulfillment of the agreement; periodically monitor the degree of progress; effectively renegotiate when necessary and - accordingly with the results that are obtained - demand to assume - or assume - the pertinent responsibilities in case of delay, abandonment, cancellation,revocation, etc.; kindly receive what is delivered (if something is delivered); sincerely thank what has been received (or claim what is not received on time); carefully evaluate the degree of satisfaction… and after detecting and deciding the necessary adjustments, to satisfy the previous conditions and / or those that new circumstances warrant contextual feedback to those responsible, thus restarting a new cycle of coordination of actions.to satisfy the previous conditions and / or those that new circumstances warrant contextually feeding back to those responsible, thus restarting a new cycle of coordination of actions.to satisfy the previous conditions and / or those that new circumstances warrant contextually feeding back to those responsible, thus restarting a new cycle of coordination of actions.
This task - integrating matters related to business coaching and coordination of actions - implies dynamically aligning and encouraging the vision, values, strategy and action, through the incessant exercise of a transformative leadership (Bass) -beyond the transactional- that: with idealized influence (charismatic), inspiring motivation (emotional), intellectual stimulation (linguistic), and individualized consideration (distinctive), lead all people to express themselves with presence and contact, to stand up for themselves, to generate team (s) human (s) of optimal individual and collective performance, synchronized (s), energetic (s) and captivating (s).
Strategic leadership -to be fully and sustainably successful- requires leaders predominantly in a condition of optimal performance, which implies mastering -for themselves and for others- a series of linguistic, emotional and corporal competences that facilitate them to achieve things with words, acting with emotional intelligence and full deployment of their physical potential: business coaching provides these and other competencies that - together with spiritual clarity - allow them to face productively and healthily stressful personal and corporate challenges without negatively altering their family life or personal development, but rather everything otherwise.
The success of the strategic leader is a group success that transcends simple individual success, and cannot be achieved and sustained without a strong dose of self-motivation and inclination to achieve: “first define what you want to become and then do what you have what to do, until it is achieved ”(Epictetus).
We have only 2 important steps to describe.
They encompass what is called strategic learning or double-loop learning, a trial and error approach -which adequately considering the impact of organizational defenses- has renewed and put the issue of organizational governance to a distinctive and effective value, that is, of the possibilities of achieving what you want to achieve.
Governance was also the objective of the now obsolete traditional control of management, now called new managerial control or management assurance: name changes that are nothing but precursor flaps or late manifestations of a long-announced extinction; extinction that in general the BSC has helped - fortunately - to favor.
But there are notable cases in which this has not been understood: after spending many millions in designing and computerizing BSCs - as an end in itself - the management is even more out of control; Note that what leaders want to achieve is more governance (the purpose) and not BSCs or management control systems (the media): increasing governance implies solving more of a political power problem than an instrumental one of technology.
11. Strategically Appreciate the Situation, periodically or whenever circumstances warrant.
This assessment implies measuring, graphing and appreciating -as a function of time- relevant trends and results, and comparing them -in accordance with the evolution of the situation and prospectively- with pre-established trends and goals, for different past -exogenous- scenarios (which were left behind), present (in which we develop now) and future (that are glimpsed forward).
The idea is to interpret and explain the situation that was lived, is lived and could be lived versus the one that is wanted to live. The BSC can be useful in this regard, but with some limitations and distortions if precautions are not taken: what can be represented by vectors cause effect, matrices, algorithms and probabilities, will rarely reflect the complexity of the situation to be made manageable.
In this regard, I suggest seeing an article by the subscriber in the magazine Calidad Empresarial ("Beyond and more here from the BSC"), and another published by the AVE (Venezuelan Association of Executives) on the design and use of BSC's.
The important thing is to realize both that the non-controllable exogenous is almost always more diverse and sometimes of greater impact than the controllable endogenous, and that we can only act in the present, that only - anticipating the future - can we plan our actions more effectively, and that we can only try to explain what happened in the past, but we cannot modify it.
Let us remember the unexpectedness of the attack on the twin towers in NY and how difficult it was, is and will continue to be prepared to prevent suicide attacks in a timely manner and / or lessen their impact. The effort of the USA and other powers is a pioneer and a priority, to prepare quickly and cautiously, to prevent and counter similar and other attacks, in the present and in the future… even before counterattacking, and even before deciding who counterattack and where, how and when to do it… knowing the unexpected risks against counterattacks helps… but does not guarantee success.
Not even the most sophisticated information systems can inform us in real time about all the determining factors of the present situation or the one to come, especially in terms of an uncertain and challenging environment. Hence the need to also trust our insight and intuition (Sun Tzu), with information that is probably incomplete and perhaps false… (von Clausewitz).
In addition, it is necessary to realize that -although it were possible- it is very difficult to design and / or simulate instantaneous and powerful adjustments, with immediate and forceful effect. Hence the importance of appreciating the exogenous rather than the endogenous in advance, which has not yet happened but it is foreseeable that more will happen than what has already happened and that is unchangeable, and-consequently- explore and appreciate in advance the consequences of acting in a timely manner. -or not- outside and inside, now and later: "the species that survive are neither the strongest nor the most intelligent but those with the greatest capacity for adaptation" (Darwin).
It is relevant to realize that doing more of the same - or exploring variations on what worked before - does not imply that it will now and will not be the best solution.
The observer of what has happened and what is happening alters what is observed (Heisenberg). The explanation of the observed belongs to him and not to the observed situation (Maturana). It is therefore essential that the observer / actor observe himself acting, observing and reflecting on the situation he is trying to understand and make governable, with the design and implementation of new and more powerful actions (Argyris, Schein).
12. Tactically and / or Strategically Adjust Management, implies - prior interpretation and valid explanation of the future, present and past situation - the design of the pertinent adjustments, estimating both the time necessary for them to give results and the costs that their design and execution would imply, and the impact that the adjustments would have on the situation to be governed: it is important to bear in mind the organizational defenses and the resistance to change that derive from them, since it may happen that the favorable displacements that we are achieving -towards what we want to achieve- disappear abruptly or progressively before our intervention achieves a complete displacement that is sustainable over time. The dance of change is between the drivers and the limitations of change that makes learning viable,organizational growth and development (Senge).
