Strategy Kinetics, LLC

The 10 Commandments of Crisis Management

OK, I like lists. Well, at least some lists. From South Africa comes the 10 Commandments of Crisis Management formulated by Evan Bloom, MD of the Crisis Communications Consultancy. Here are the first few:

1. You shall always have a crisis plan and keep it handy
Responsible management and practitioners of good corporate governance in South Africa ensure that their companies and organisations have a fully fledged PR crisis plan that deals with all eventualities. The plan must be based on a bespoke vulnerability and risk audit and scenario planning, and must integrate into an organisation's supply chain and business continuity plans.

2. You shall tell it all, tell it fast and tell it honestly

3. You shall stare the devil down and be brave

Amen.

The whole article is worth a read.

Backcasting

Recently, someone pointed out to me that Future Mapping / Scenario Mapping / Problem Resolution Mapping is a form of Backcasting, a set of strategic planning techniques that work backwards from some assumed future. In researching the use of "backcasting," I found this presentation from the Information Architecture 2007 Summit by Matthew Milan and Sam Ladner that provides a high level overview of how they use Backcasting in client engagements.

I'm a big fan and practitioner of "cards on the wall" meetings (or in Milan and Ladner's case, of Post-its on the wall). Their form of Backcasting and Scenario Mapping share some common assumptions, including: assuming divergent futures, working backwards, avoiding the forecasting frame, interactive discovery, and participant ownership of the results.

In over-viewing the history of Backcasting, Milan and Ladner indicate (slide 11) that the '90s saw the development of "big backcasting," whose liabilities (slide 12) include projects that are complex undertakings, resource intensive, and time consuming. Locating most Scenario Mapping projects in their "big backcasting" category, they have a point. The question is whether these are really liabilities.

Milan and Ladner also indicate that "big backcasting" projects are inaccessible to non-experts. If they mean that the content, results, and recommendations are inaccessible, I would quickly disagree. If they mean that actually facilitating / leading / doing a "big backcasting" project is difficult for non-experts, that often seems to be the case.

When clients have attempted to do Scenario Mapping projects without the involvement of consultants, with rare exceptions they find it difficult to do successfully. Consultants who do a lot of these projects have a wide range of experience to call upon. Internal facilitators usually do these kinds of projects less often. Although they may understand the process, they typically lack a wide range of Scenario Mapping project and facilitation experience. Consequently they often lack knowledge of the many variations and options available to facilitators.

There is another reason why Scenario Mapping is often difficult for non-experts. One of the requisite skills is the ability to assemble, prioritize, synthesize, and "chunk" a very large amount of information. Although this skill can be taught, it seems to require some basic facility. For example, certain Myers-Briggs types are often particularly adept, INTJs and many ENFPs, for example. Thus not everyone will be able to facilitate successfully a "big backcasting" project based on processes such as Scenario Mapping.

There's probably a set of clients for which the Milan-Ladner form of Backcasting is appropriate and cost effective. Although I have not been a participant in any of their projects, I believe that bottoms up, made-up-on-the-spot engagements provides an excellent brainstorming context, a forum for idea generation, and some good ideas that are actionable.

However, you get what you pay for. Scenario Mapping is more complex, more resource intensive and more time consuming. As noted, Scenario Mapping combines simulated hindsight or  Backcasting with a high prepared meeting. The work that goes into meeting preparation lays a foundation for more informed decision-making, developing a clear set of action priorities, and in many engagements, the association of responsibilities with action items.

Scenario Mapping participants routinely report that strategy setting aside, they leave with a much expanded personal knowledge base and views of their company, industry, markets, technologies, etc. Although time consuming and perhaps complex, this knowledge base becomes a valuable resource that clients typically draw on post meeting. In short, Scenario Mapping challenges and then enhances the mental models of workshop participants.

Here's a brief overview of Scenario Mapping.

Scenario Planning for Indian Water Resources

In graduate school many years ago, I worked with a professor from Canada who believed that eventually the United States would consider annexing some or all of Canada in order to gain access to that country's water resources. Anything is possible.

According to this press release,

TERI-BCSD (Business Council for Sustainable Development) India in association with the Bombay Chamber of Commerce and Industry & The Leela Group of Palaces, Hotels and Resorts is organising a national workshop on Water Scenarios for Indian Businesses on 05 June 2007 (World Environment Day) at The Leela Kempinski, Mumbai.  Mr. SM Krishna, Honb’le Governor of Maharashtra will be the chief guest and will deliver a special address.

Water allocation problems include:

In the National Water Policy and several state policies water allocation to industry is at the bottom of the priority list.  Keeping this in view, sustained supply of freshwater becomes a critical issue for the survival of many industries especially water-intensive industries. The risk that industry faces today can be measured in terms of situations that have occurred where water stress, measured in terms of both availability and quality, has led to an increase in water costs, growth in business disruption and increased concern among the stakeholders about companies’ water-related performance.

World Without Borders? PWC CEO Survey

PWC has released is 10th Annual Global CEO Survey [registration may be required]:
Was:
Within borders
Is:
Across borders
Will be:
Without borders?

Being able to anticipate many different scenarios is one of the keys to success on a global scale:

As a consequence of complex technology, multiple regulatory regimes and a trend towards geopolitical tensions, risk is becoming more complex. This requires that executives be extremely attuned to establishing control and risk management mechanisms and that they possess the foresight needed to anticipate many different risk scenarios.

To be successful in this rapidly changing global environment, CEOs thought four characteristics were key:

• Possess vision – Exploiting the potential of ever-expanding markets and harnessing the power of technology and innovation requires vision. Global executives must possess the vision required to redefine their business models. They must also be able to inspire, motivate and empower their people to fulfill that vision.

• Demonstrate agility – The successful global executive will be agile enough to react to rapidly changing business conditions and to collaborate in support of new business models.

• Become global citizens – In the global marketplace, parochial or territorial thinking will not suffice. Global business leaders must embrace diversity, understand and be able to reconcile cultural differences, and contribute in meaningful ways to the communities in which they do business.

• Show courage – Important at any time, courage is even more necessary in an environment defined by uncertainty and increased risk. The courageous business leader boldly embraces new opportunities, responds to new risks and takes on new responsibilities. Such a leader is prepared to make tough decisions to ensure that the needs of sometimes competing stakeholders are fairly and equitably met. 

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Strategy Kinetics, and its network of affiliated consultants, can help CEOs anticipate alternative futures, manage in the face of uncertainty and complexity, reduce risk, and develop and implement strategies that are responsive to rapidly changing conditions. Email us to find out how.

Scenario Planning in the UK - NOT

Management-Issues.com, a UK site that "focuses on the leadership, management and people issues that are at the heart of the changing workplace," has an article reporting results from a survey conducted by Ernst & Young and recruiter exec-appointments.com of 50 non-execs age 50 or under. The survey suggests that there is a diminished talent pool from which major UK public companies can recruit. Among the talents deemed in short supply are individuals and boards who can provide strategic leadership.

The research also uncovered a consistent undercurrent of anxiety over the low priority given to strategic and scenario planning.

"The overarching picture is that there is a real and worrying call for better board strategies, backed by rigorous scenario and contingency planning," the report warned.

"Few are satisfied that their board process delivers the quality of forward-looking plans that will enable them to deliver expected results," it added.

Thayer [CEO of exec-appointments.com] argued many non-execs were not comfortable that they were sufficiently engaged in strategy, that development strategies were not being developed which explored multiple scenarios and not enough time was being given to debate and refine proposed strategies.

Scenario Planning Keeps TDS Telecom Ahead

The Wisconsin State Journal has an interview with Jim Barr, CEO of TDS Telecom that briefly notes the company's use of scenario planning to stay ahead of the competition. Snippets:

A: It's certainly a constant battle to keep up. (Joking.) We do have five-year plans we create every six months.

Sometimes there isn't a big difference between one six-month period and the next. We're always in the situation of trying to understand what's going to happen in our strategic planning.

We do a lot of scenario planning, figuring out, where the industry is going. And will our strategy work in the widest variety of scenarios?

WSJ Tribute To Peter Druker

The WSJ Online has an extensive tribute to the late management consultant Peter Drucker here [Subscription required, I believe]. In addition to articles of praise, the tribute also includes, among several other of Drucker's pieces, the full version of the Five Deadly Business Sins article.

The Education of Andy Grove

Harvard historian Richard Tedlow's lengthy article on Andy Grove in Fortune is not to be missed. It might have also been called Zen and The Art of Corporate Maintenance, or more simply, Zen Strategy Master. The story of Intel and Grove have been told before, of course, but Tedlow's article distills the important lessons. A snippet from the article setup:

Goodby Peter Drucker

Peter Drucker has died at the age of 95.  One of the few management consultants worth listening to, whose thoughts and views were usually far from the current fads. His article on the 5 deadly business sins has been a personal favorite.

His NYTimes obit provides an appreciation and history.

Scenario Planning: An Irish Perspctive

The Derry Journal (Ireland) has a longish article (registration required) that deals with scenario planing and strategic management. Snippets:

Art's Series on Scenario Planning

NCRI/Nervewire Alumni Art Hutchinson is running a series of blogicles on scenario planning that launched yesterday. The first article says that diverse inputs are one important key to the process. Couldn't agree more.

Regarding the so-called Wild Ducks, people who have something important to contribute but don't fit the corporate mold, I think of those people as, for example, the person at the end of the corridor that most people don't like talking to, who is contrarian to a fault, but who makes an important contribution to the firm. Often that person has something unique to offer the scenario planning process. Whether they are included in the actual meeting or not, it's important to interview those people and gather their views. They are often trying to tell the company something important that the company doesn't want to hear.

And sometimes they are just a pain without much to say. But the consultant shouldn't take anyone's word and at least take the measure of the person directly.

Scenario Planning and Knowledge Engineering

The "cards on the wall" tools and scenario planning generally can be applied to the broadest range of organizational, societal, and international problems. In addition to planning methods generally, I will focus on strategy development and implementation relating to The Future of:

• The Music Industry
• Global Climate Change
• Healthcare, Medicine, Pandemics, and
• (biological, chemical, nuclear) Terrorism
• Telecom

Why these issues? In part interest and in part to suggest that the strategy development and implementation tools we frequently use on Strategy Kinetics-led consulting projects are useful in addressing the broadest range of strategic problem areas, including those that are believed to entail exceedingly intractable social messes, such as global climate change or healthcare in the United States and as a global human issue.

Scenario Planning in South Africa

The Business Report, apparently carried in several South African newspapers, has an article reporting the use of scenario planning including the titles of various possible outcomes or endstates. The original work in the 1990s was done by Peter Schwartz and GBN, a well known scenario planning firm. Snippets:

While their elders agonised, a group of bright young South Africans said it was all very simple: select a "dual carriageway", in which strong economic growth runs parallel to the deliberate development of disadvantaged people and communities.

This was the conclusion of a scenario planning exercise, South Africa 2020: Creating the Future. The workshops were hosted by the Montfleur Conference Centre in Stellenbosch.

A team of 29 young professionals identified paths that South Africa might take between now and 2020. As with the original Montfleur scenarios in the early 1990s, the participants came up with titles that captured the essence of the scenarios.

Bill Gurley's New Blog

Benchmark Capital's Bill Gurley (previously at Hummer and CSFB) has moved his "Above The Growd" newsletter to a blog here. Always an interesing "read." The initial article addresses why the US is falling behind in broadband penetration.

The 5 Deadly Startup Sins

Elsewhere in these pages is an article that refers to Peter Drucker's instantly classic, The Five Deadly Business Sins. Without at all holding myself out to be a Drucker, here are what I believe to be the five deadly sins of a start-up business:

1. Excessive Ego. One classic manifestation is the technologist who demands to be CEO. The company, technology, and products are his--less frequently, her--babies. Teaming is difficult for someone in the Ego Trap.

 

2. Excessive Greed. The CEO and/or Board of Directors insists that the value of the company is $x Millions. Not a million less. By the time the dust settled, the money went away. The company closed its doors.

 

3. Vision Rather Than Market Driven. When committing this sin, the sinner fails to ask potential or actual customers what they really need. The startup assumes because the founders resonate with a particular vision of how the world must be in 18 months or 36 months, the world will resonate as well. And it has to turn out that way because the vision says so.  Everyone will want to use widgetoptitron software. It's the next Big Thing. Not infrequently, the product is significantly over-engineered--too many features. Or under-engineered with not enough of the really valuable features implemented. Both God and the Devil are in the details on this one.

 

4. Technology Rather Than Market Driven. This sin is similar to the Vision problem, except it's technology driven. Our flabergastic overdrive chip will change the way in which all networks operate because it's 10x better than anything available today. Not necessarily. Again, this naive faith in technology leads to what might have been an avoidable failure.

 

5. A Business Ecosystem of 1. Start-ups assume that if they find potential customers and get their supplier costs and quality right, all will be well. Maybe. But in most verticals, its a collection of cooperating companies that succeed by competing successfully against one or more other collections of companies.  Startups need alliances and partnerships much more than large established companies. Startups are vulnerable. Big time.