Reinventing Strategy - by Willie Pietersen - PART I: THE NEW LEADERSHIP CHALLENGE

Introduction
PART I: THE NEW LEADERSHIP CHALLENGE
PART II: IMPLEMENTING STRATEGIC LEARNING AS A LEADERSHIP PROCESS
PART III: STRATEGIC LEARNING FOR PERSONAL GROWTH
Remarks
Reading Suggestions & CONTENTS
About the Author

PART I: THE NEW LEADERSHIP CHALLENGE

“Knowing what to do is important, but … to win, you must know how to do it. You must be able to move beyond the rhetoric and actually implement your strategy.”

Distinct universal forces—the Internet, globalization, deregulation and privatization, convergence, and disintermediation—are interacting with one another to radically alter the way business is conducted today. Thus, the rules for competition have changed, not only for dot-coms and high-tech enterprises, but companies of every kind are under extraordinary pressure to transform themselves and develop effective responses. In fact, as Pietersen notes, long-term success now depends on the ability to do two seemingly contradictory things simultaneously: (1) improve existing processes and products through continuous incremental change and, (2) invent totally new and better processes/products via discontinuous breakthrough change. Thus, creating the right balance between incremental improvements and radical innovation is key. And, though a shortage of resources is not necessarily fatal, a shortage of imagination can be.

Most breakthrough innovation seems relatively easy to accomplish by individual entrepreneurs such as Ted Turner, Fred Smith or Anita Roddick, but this is generally not the case for large, established firms, weighed down by tradition and bureaucracy. All social institutions, including businesses, adhere to the natural law of birth, growth, maturity, decline, and death. This tendency can be illustrated by the sigmoid curve (S-curve), which teaches two powerful rules: Nothing lasts forever under its original momentum. And, success contains the seeds of its own destruction. When an organization reaches the top of the curve, it becomes complacent, inward looking, political, risk-averse, forgetful of the drivers of initial success, and obsessed with entrenched standards and routines.

According to Pietersen’s findings, the best time for companies to change is while they are still successful, and highly resistant to fixing what “ain’t broke,” rather than when they are beginning to fail. Moreover, this process must be ongoing—there must be a constant push to adapt and innovate so that “anxiety is never assuaged by success.” Given this approach, the S-curve also teaches the importance of riding a series of curves, for products and services no longer represent sustainable advantage. Instead, it is a firm’s organizational capability to constantly renew itself that will allow it to win and go on winning. Thus, the author believes that today’s primary leadership challenge is the creation and maintenance of an adaptive enterprise and that Strategic Learning is at the heart of this kind of successful adaptation.