“We don’t know” is unacceptable in some occupations. If you were to pop your head into the pilot’s cabin before take-off on your next flight and ask, “do you know how to fly this thing?” you’re not expecting to hear “we don’t know.” That would have you backing hastily to the exit. Knowing is highly valued and, in this case, very important – to passenger safety.
But flying a plane, operating a piece of machinery, or undertaking brain surgery are vastly different from guiding an organization into its future. In business strategy you’re not only confronted with known unknowns, but unknown unknowns too.
You might think that personal humility is an odd starting point on the journey to corporate competitive advantage. But this is exactly where you must begin if you are to navigate your business successfully in today’s environment.
If the culture of your executive team does not accept “we don’t know” you have a problem. Going forward from there in this fast-moving world can only lead to further issues. To overcome this, organizations are turning to openness.
Organization Openness Is Key
It’s impossible for boards and executive teams to have all the answers. Consequently, many strategic conclusions made by them are out of date or just plain wrong. A.G. Lafley discovered this when he was CEO of the consumer products giant Proctor & Gamble. The company had lost touch with its consumers. “Too often we were working on initiatives consumers did not want and incurring costs that consumers should not have to pay for.”
He also noted: “We won’t succeed without a deep understanding of external stakeholders and their competing interests, and how those interests correspond with the capabilities and limitations of the organization.”
When Satya Nadella took over as CEO of Microsoft, after 14 years under Steve Ballmer’s reign, the signs were there that the business had begun to ossify. It needed a strategic shift to keep pace with rapidly changing circumstances and devouring competitors.
As Nadella observed, Microsoft had become a company of “know-it-alls.” So, he set about converting the company into one in which its managers were “learn-it-alls.” One of the principles driving this was the need “to be insatiable in our desire to learn from the outside and bring that learning into Microsoft.” That required the admission that “we don’t know” from executives.
DHL is another company whose executives are prepared to admit “we don’t know” when it comes to strategy. It operates four “innovation centers” in Singapore, Bonn, Dubai, and Chicago. These are set up to engage customers in uncovering “emerging trends”, generating “insights” and identifying “competitive services”. As the company explains: “We welcome customers, partners, and other innovative thinkers to engage with DHL experts.”
Lego too has used this logic to advantage through Lego Ideas. The company asks its followers and users to contribute suggestions in “contests” via its website. Ideas go through an initial intake, expert review, crowd vote, and winner announcement. This operates on a grand scale, of course, but is it unrealistic that you might engage a section of your key stakeholders in cracking a strategy puzzle that relates to them?
Tap into Distance
Research has shown that the further away you are from a problem in terms of technical expertise the more likely you are to come up with a “winning solution.” Your ideas are less likely to be grounded in the everyday and to have become staid. That’s important to recall. Translated into generating strategic options, this means that downing tools and admitting “we don’t know” might be the best strategic idea you’ll have on your road to success.
Your biggest barrier to strategy’s “we don’t know” is your organization’s culture. As Satya Nadella found at Microsoft, attitudes and behavior become embedded and habitual. Just as Microsoft demonstrated, change must start at the top. With that as a given, here are two suggestions to overcome your team’s strategy blind spots – one in-person and one remote.
The in-person step involves strategy co-creation. This requires you to invite members of your key stakeholder groups to sit with your executives and other staff in workshops. The aim of working together is to generate ideas about where your organization or business unit might head. In the case of employees, this isn’t so difficult – and to some extent, you may already be doing this. With direct customers and end-users, this may be a bigger step. But it’s doable.
Remember, though, that outside involvement can go beyond your immediate stakeholders taking in participants from outside your industry. Those distant from your industry will certainly approach any questions you have with fresh eyes.
The remote step involves crowdsourcing for strategy insights. Think about it. Customers and other key stakeholders are only too happy to offer their opinions. After all, if you listen, they benefit. Even for a small business this is achievable. The technology is there and accessible, e.g., Openideo, Innocentive, and UTest.
Just remember, intended or not, your business has a way of putting pressure on its managers. Pressure to get results. Pressure to meet targets. And, worst of all, pressure to “know”. Ego, hubris, and saving face get wrapped up in this and the mindset becomes – I can’t admit “I don’t know.”
The result? Your organization closes in on itself in the pursuit of answers.
To avoid this in future, find an opportunity to strike up a conversation about personal humility at your next strategy meeting. It could be your business’s gateway to truly effective strategy.
Author – Graham Kenny
Regular author in the Harvard Business Review
Graham Kenny, CEO of Strategic Factors, is a recognized expert in strategy and performance measurement who helps managers, executives, and boards create successful organizations in the private, public, and not-for-profit sectors. He has been a professor of management in universities in the U.S., and Canada. You can connect to or follow him on LinkedIn.