Success in strategic speed

By ANDREW LEE
andrewlee@thestar.com.my

The early bird catches the worm” is probably one of the more popular idioms, and one that is often applied to business. It is well accepted that success in business favours the swift – companies that are able to create the most value are smarter and faster than the competition.

However, it might come as a surprise to many that despite ample resources, fancy graphs and streamlined processes in place, often the biggest problem is implementing a strategic initiative on time. Why is this the case?

President and CEO of Forum Corp, Edwin H. Boswell, has a theory. He argues that many companies focus exclusively on pace and processes, a strategy that only leads to superficial speed: lots of activity but little forward motion, short-term gain but eventual stagnation.

The more successful companies are able to achieve strategic speed – implementing strategies both quickly, and well, by shying away from fool’s gold and making the people in their company the key ingredient in their success formula.

Speaking to StarBizWeek via video link from Boston recently, he discussed the theories of his new book, Strategic Speed: Mobilize People, Accelerate Execution (Publisher: Harvard Business Press), a subject that he believes in passionately.

Boswell is one of three authors of the book. His co-authors are Jocelyn R.Davis and Henry M.Frechette, Jr.

What was the catalyst behind this book?
We started work on this book two years ago. Our company’s specialty has always been advising clients on how to execute strategies through people. And we wanted to write a book for leaders on how to get things done quickly and effectively, and the execution of those strategies.

The global financial crisis came soon after we started work on the book. This affected businesses around the world. This prompted us to dedicate a large part of the book on the speed of execution, because this unfortunate turn of events drew our attention on speed.

Can you tell us a bit about your research for this book?
We read over 500 books and articles, basically every bit of research done on execution over the past 20 years. Another important part of the work that went into this book was the survey we did with more than 350 leaders in the corporate sector, in government and those heading charity organisations around the world. We did this together with the research arm of The Economist magazine, their Economist Intelligence Unit.

We also studied 18 companies in-depth. This led to case studies on organisations such as Vodafone, Morgan Stanley and Fender Guitars. Finally, we drew on Forum Corp’s 20 years of experience managing clients to complete this book.

What were some of the key findings of your research?
There was truly a distinction between companies that executed strategies with strategic speed and those that did not. For instance, the faster companies in our sample were able to generate superior business results. On average, over a three-year period, these companies generated faster revenue growth, 40% faster than the slower ones. They made profits 50% faster as well.

What were these companies doing that made them quicker than the others?
The faster companies did not make the mistake of mistaking speed for pace. They proceeded with strategic speed and took the people factor into account. There was a high level of clarity among the people in the business about what the strategy was and the leaders made sure they took time to make sure everyone understood the company’s direction and his own individual role.

The second difference was unity. The faster companies had a stronger commitment to their strategies as well as towards working together. Lastly, these companies had a high level of agility. They had the ability to adapt to changes in the external environment, to new information in the market, as well as new opportunities or risk that came their way.

How did these companies keep their high levels of clarity, unity and agility?
That’s what most of this book is dedicated to – the leadership practices that the faster companies engaged in.
There are four main practices: the first is the affirmation of strategies. Leaders of fast companies made sure that everyone not only understands the strategy, but also buys into it.

The second is driving these initiatives. Successful leaders do not just delegate strategies, they are pretty involved in the execution of it.

Thirdly, there has to be a positive environment. This sounds cliched but if leaders are able to pay attention to the changes taking place around them,they will be able to bring out the best in their workers.

The last is cultivating experience. For example, leaders in the faster companies encourage people to step back from their day-to-day activities to share their experiences with colleagues.

The faster companies would implement these four leadership practices two to three times more frequently than the slower ones, leading to higher levels of clarity, unity and agility, which subsequently bring about strategic speed.

Will strategic speed affect quality of the final product? Is it possible to have both speed and quality?
We had a chance to interview Vodafone (one of the world’s largest mobile phone providers) chief executive officer Vitorio Collao in London recently. He did not accept the notion that speed and quality were enemies.
Vitorio wanted to create a global plan so that their clients could get the same level of service. The only problem was that Vodafone was a decentralised company, resulting in their clients receiving more invoices than they needed every month.

He knew any attempt to provide better service to his top clients would take a few years as the company was so large and complex, while team leaders would tend to proceed slowly and cautiously when executing strategies for fear of jeopardising an important plan.

Therefore, he created small teams of five or six persons and implemented a system of acountability. The team leaders would be given 12 months to execute the plan. They would also be allowed to make mistakes. He wouldn’t fire the leaders for making mistakes, he would only resort to the sack if the leaders repeated the mistakes. His belief was that smaller teams wouldn’t be as liable as bigger teams to making critical mistakes, rather, they tend to be mistakes that the company can recover and learn from.

This project was wildly succesful and Vodafone managed to generate US$3bil in incremental revenue.

Do you think culture plays a part in implementing this strategy?
One of the things we looked at is the cultural differences around strategic speed. In the West, speed is valued often just for its own sake. In other parts of the world, perhaps speed may not be as important as relationship or quality, as stated earlier.

Different cultures put different values on speed and this is a dilemma that managers have to navigate. Now that more companies around the world are becoming global, we all have to adapt to these different cultural values, even a small company like Forum due to our operations across four different continents.

I think managers all around the world are on a steep learning curve at the moment trying to identify and appreciate these different values. We do accept that there are cultural differences around speed and this will present us with new opportunities as well as challenges.

The narrative of failure and failure of narrative

Getting a clear message across at the appropriate time

"We need to tell our stories to each other better for a more stabe world"

FINANCIAL crisis is basically a story of failure, but the failure is due to lack of understanding of how to prevent or solve the crisis.

Hence, it is also the failure of narrative, or how to tell the story to each other so that people communicate and understand what to do.

Linguistic professor Robert Kaplan first introduced the notion that different ethnic groups tell narratives very differently.

It is not just the story, but the sequence of how the story is told.
For example, he drew diagrams of how Anglo-Saxons would tell a story in a straight line, from beginning to end.

A Chinese story-teller would go in circles before coming to the conclusion. A Jewish story-teller would zig-zag from one view to another before coming to the conclusion.

Kaplan’s theory of narrative shed new light to understanding how different groups think and communicate with each other and immediately sparked off controversy.

Do Anglo-Saxons really behave that way or is the truth much more gray?
An Australian is likely to be “in the face”, telling you to your face that you are wrong.

An American will do the same, but slightly more politely. I learnt from my years in England that when an Englishman praises you, it could sometimes be a criticism.

On the other hand, if he insults you, he is treating you as a friend. It depends on the context of the communication whether he is being friendly or insulting.

Misunderstandings happen because different people communicate differently.
Most of us know that selling a message depends on how the message is delivered.
Delivering bad news is the most difficult part of communications.

Most bosses shoot the messenger, which is why no one likes to be the first bearer of bad news to the boss. But he or she needs to hear the bad news, if they are good leaders. Those who listen to only good news will sooner or later live in a dream world.

But how to deliver bad news is itself an art.
My favourite legalist philosopher, Han Feizu (3rd century BC), was probably the best story teller philosopher in Chinese history.

Many popular folk stories actually came from his writings.
He wrote well to compensate for the fact that he stuttered so he could never win verbal debates against his opponents in court.


But his stories and parables cut to the bone on what he had to say.
The First Emperor was so impressed by Han Feizu that he schemed to bring him to Qin to be an adviser, only to kill him because his other advisers feared Han Feizu’s ability.

Two of the most insightful articles by Han Feizu are on the difficulties of speaking.
In them, Han Feizu demonstrates his mastery of inter-personal psychology – what to say, how to say and when not to say.

The difficulty of speaking to a leader is not what you want to say, but whether he is willing to listen.
It also depends on how you package your message. If you put it too generally and dressed up in good news, he will accept it as flattery.

If you put it too bluntly and full of facts, he may suspect that you have your own agenda.
Han Feizu knew that it was very important to understand what the ruler or the listener really wants to hear.

Hence, if you present a message that no one wants to hear, your message will not be heard and your own position may be in peril.

This is exactly the problem of economists who warned about the current crisis.
Most of the established economists who missed reading the warning signs claim that no one else saw the crisis coming either.

This is clearly not true. Rather, the truth is that the bulk of the economics profession ignored the warning signs. Then, they rationalised it by claiming that something happened that caused them to misread it.

The expert consensus can never be wrong, otherwise they are not experts.
Modern psychologists call this “cognitive dissonance”.

There was a famous case studied by a psychologist of a cult group who claimed that the world was coming to an end on a certain date and that they all had to go up a mountain where a space ship would come and save them all.

Of course, on the due date, the world did not end and the space ship did not come, but the leaders claimed that it was because God heard their prayers that caused the postponement of the world’s end.

The world is now so complex and we are so bombarded with too much information that we do not know easily what to do.

So we are likely to listen to those people who are acknowledged as wise.
Hence, we are more likely to believe a Nobel Laureate in economics than our local economics professor, even though the local may know much more about local conditions than the foreign Nobel Laureate.

The more the world is inter-dependent, the more important that the East and the West should understand each other.

In an age of instant solutions, the West is more likely to be fixated by simple solutions to complex issues, such as whether the exchange rate can solve global imbalances.

Nobel Laureate Paul Krugman is influential because he writes a New York Times column and he thinks that China manipulates the currency just to export. He is being emotional and not rational in his analysis.

The Japanese yen revalued substantially without diminishing Japanese exports abroad.
Most of the exports of China are by multinational companies who happen to manufacture in China for Western markets.

There are no simple answers to complex questions. This is the failure of narrative between major trading partners.

We need to tell our stories to each other better for a more stable world.

·Tan Sri Andrew Sheng is adjunct professor at Universiti Malaya, Kuala Lumpur, and Tsinghua University, Beijing. He has served in key positions at Bank Negara, the Hong Kong Monetary Authority and the Hong Kong Securities and Futures Commission, and is currently a member of Malaysia’s National Economic Advisory Council. He is the author of the book “From Asian to Global Financial Crisis”.

Internet junkie children have parents worried

By JOSHUA FOONG
joshuafoong@thestar.com.my

PETALING JAYA: Parents and teachers have been left in a quandary as the onslaught of Internet games and social networking sites are bringing out a rebellious streak in many children.

“Why are you controlling my life?” – is the question often thrown back by children to their parents or teachers when they are confronted with their obsession with the Internet.

 

Teenagers playing online games at a cyber cafe in Kelana Jaya, a common scenario at almost any cyber cafe. - AZMAN GHANI/THE STAR

 

Norton, an Internet security company, produced a family report in 2010 which stated that Malaysian children spent an average of 64 hours online every month.

National Union of the Teaching Profession secretary general Lok Yim Pheng described the students’ obsession with the Internet as a silent killer which was “killing off” the interest of students in class.

There had been reported cases of students falling asleep in class after a whole night of playing Internet games and on-line chatting.

Lok had been ringing the alarm bells over this issue for the last five years.

She said there were also students who starved themselves during recess time because they wanted to save up for trips to cyber cafes.

“There have also been cases where stealing is involved,” she said.

Public complaints go-to man, Datuk Michael Chong said many parents had come crying to him saying they were at a loss over what to do.

“Their children spend countless hours on the Internet – with some cases involving primary school students surfing pornographic sites,” said the head of the MCA Public Service and Complaints Department.

Psychologist Dr Goh Chee Leong said the Internet was enticing because it was “very engaging and stimulating.”

“This problem is more prevalent in the middle and higher class families because they can afford to buy computers,” said the vice-president of HELP University College.

Mary (not her real name), an ex-addict, said that at the height of her obsession with online games, she only slept once every two days.

“I was 16 then. I was having teenage angst and like my peers, I needed a world where I could be in control and I could win,” said the undergraduate.

Luckily, she grew out from the phase when she was 19. Her bad grades were a nasty wake-up call, said the 21-year-old.

Father of three and marketing manager Simon Lee worries that his children will neglect their studies if they spend too much time on the computer.

But he could soon have a solution.

Software engineer Wayne Koong has invented a programme which slows down Internet programmes tremendously, to make the viewers get impatient and lose interest.

To know more about it, you have to log on and go to www.internetoveruse.com.