Flylib.com

Books Software

 
 
 

Strategic Inflections Points Can Strengthen Organizations


Strategic Inflections Points Can Strengthen Organizations

Not all strategic inflection points spell disaster for an organization and its managers. Says Grove:

Strategic inflection points offer promises as well as threats. It is at such times of fundamental change that the clich "adapt or die" takes on its true meaning.

How can this be? Because companies that adapt in response to profound pressures often reinvent themselves , adding important new skills and competencies as they adjust to the external change. In most cases, early detection of the strategic inflection point is key . By acting before the potential damage inherent in the SIP occurs, organizations can not only fend off the near- term threat, but also develop an inner strength that can help them through difficult times for years to come:

Businesses are about creating change for other businesses. Competition is about creating change; technology is about creating change....So the ability to recognize that the winds have shifted and to take appropriate action before you wreck your boat is crucial to the future of an enterprise.

As the organization approaches and comes to terms with an SIP, it's the corporate mind-set that counts. And, as stated earlier, complacency is the worst possible mind-set. It is much better to be fearful, says Grove, for fear keeps companies skeptical, sharp-edged, and on their toes. Therefore, when Grove was CEO at Intel, he worked to instill a healthy amount of paranoia into the organization, in the conviction that vigilance was one of the ingredients of the company's success:

I attribute Intel's ability to sustain success to being constantly on the alert for threats, either technological or competitive in nature. The word paranoia is meant to suggest that attitude, an attitude that constantly looks over the horizon for threats to your success.

And prompt action , once vigilance has served its purpose, is equally important. Says Grove:

It is best when senior management recognizes and accepts the inevitability of a strategic inflection point early on and acts before the vitality of the business has been sapped by the "10x" forces affecting it.



Dealing with a Strategic Inflection Point: A Manager's Primer

According to Grove, there are three warning signs that companies must heed in order to recognize a possible 10x force. Monitoring these signs may be an organization's best weapon against the sneak attack of a strategic inflection point.

  1. YOUR KEY COMPETITOR IS ABOUT TO CHANGE. The organization that you have long viewed as your primary competitor may no longer be the one that you should fear most. This may be an early warning that things are being shaken up and that significant change is in the offing.

  2. YOUR PRIMARY "COMPLEMENTOR" IS ABOUT TO CHANGE. The company that has long been your most important ally may no longer be as important—in the marketplace or to you. If something is happening that is changing the competitive position of a supplier or strategic partner and that supplier or partner's importance to your company, it's possible that the same train is headed toward you.

  3. MANAGEMENT'S ABILITY TO "GET IT" IS CHANGING. If members of the management team—including you—feel that they are out of touch with what is really going on out there, this is a clue that things out there may be changing at a faster rate than you anticipated.



Preparing Your Organization for a Strategic Inflection Point

Obviously, the advent of a strategic inflection point is not under one's control. So what sort of actions does Grove recommend in order to ready the organization for such a massive change? First, says Grove, the CEO has to adopt and promote a "guardian" attitude:

The prime responsibility of a manager is to guard constantly against other people's attacks and to inculcate this guardian attitude in the people under his or her management.

So how can a CEO and other senior manager make sure that they are properly guarding against attacks? There are several ways:

  1. LISTEN TO ALARMISTS. Grove calls them "helpful Cassandras"—those folks who are always proclaiming that the sky is falling. They are often middle managers (for example, sales managers), who may be less focused on strategic issues, but are closer to the marketplace than most senior executives, and thus are in a better position to detect sea changes and paradigm shifts. Pay close attention to what they are saying, and encourage "Cassandra communications" from employees and managers the world over. Emails are a perfect medium for this kind of communication.

  2. ENCOURAGE RIGOROUS DISCUSSION AND DEBATE. Only by thrashing out the possible implications of what appears to be a strategic inflection point—a debate that should involve different managers at several levels—can an organization determine whether it is truly facing a 10x change.

  3. EXAMINE—AND BE SKEPTICAL ABOUT—THE DATA. There is often no substitute for cold, hard facts. But in making the call regarding a strategic inflection point, you may need to discount the data and put more faith in your instincts , since strategic inflection points are mostly about the future , which in all likelihood is not yet measurable.

There is a very definite progression of events involved in getting through a strategic inflection point, says Grove, who speaks from experience:

Getting through the strategic inflection point required enduring a period of confusion, experimentation, and chaos, followed by a period of single-minded determination to pursue a new direction toward an initially nebulous goal. It required listening to Cassandras, deliberately fostering debates and constantly articulating the new direction, at first tentatively but more clearly with each repetition.