developing the skill of strategic thinking

Developing the Skill of Strategic ThinkingBy James Neils

INTRODUCTION

For all organizations there are always opportunities and challenges. To reduce the potential impact of any challenge and to take advantage of every opportunity organizations need people at all levels who think strategically. Traditionally strategic thinking is seen as the domain of upper management. Consequently there has been little importance given to training staff for this important skill. Research findings confirm the poor performance by managers and executives to think strategically.

Although the market place is flooded with business seminars and consultants offering assistance, executives and managers are poorly trained to be strategic thinkers. Since upper management receives failing marks as strategic thinkers it should come as little surprise that staff is not taught this important management skill. Yet, if as the writers, seminars and business leaders attest, the skill to think strategically is so important, it is time for organizations to realign priorities and recognize the need for future leaders and workers regardless of position to learn how to think strategically. This paper explores the option of using flowcharts as a starting point in the process of training all staff to become strategic thinkers.

UNDER PERFORMING MANAGEMENTResearch reported in Strategy Magazine and data from studies conducted by Rich Horwath offer a disturbing outlook about the ability of executives and managers to think strategically. A survey conducted by Strategy Magazine found more than 50% of executives gave failing marks to their management teams to think and execute strategically. Horwath reported among hundreds of executives taking a 100 question strategic thinking assessment the average score was at the 58 percentile. Not exactly the kind of ranking that would suggest executives have any right to claim primary responsibility for strategic thinking. Further, when measured against college students, the students out performed executives on a consistent basis. He postulated one of the main reasons for the student’s success was their willingness to take risks, something executives and managers learned not to do to in order to maintain or further their careers.

Sloan (2006) and a year later Goldman (2007) found evidence to counter the long held belief that the best strategic thinkers in an organization were at the executive levels. Additionally, their research found little basis to support the notion that the task of thinking strategically was the exclusive domain for managers and executives. For managers and executives the first lesson to learn and accept is that strategic thinking is a learned skill not an attribute accompanying a title. Since it is clearly not an acquired amenity to a position, strategic thinking should be part of any organization’s culture and taught to staff as well as managers and executives.

Consider how many organizations fail to emphasize consistent, monthly or even quarterly, strategic thinking sessions designed to update current strategic plans. Instead organizations have come to rely on the once-a-year strategic planning retreat as the primary mechanism to facilitate strategic thinking. Retreats for strategic planning are not a bad idea. But, how participants in a once-a-year planning session who do not regularly engage in strategic thinking can suddenly become strategic thinkers for a few hours has never been adequately investigated or explained. Would

Developing the Skill of Strategic Thinking 14/11/2023

anyone expect these same participants without training and practice to finish a marathon much less set records? No different than competitive athletes, those who aspire to become strategic thinkers need to first learn how to think strategically and then engage in repetitive practice to improve the skill.

Additionally, numerous authors have found, even in organizations that claim to value strategic thinking, corporate cultures inhibits a nurturing of strategic thinkers and/or rewards managers who follow safe and risk adverse decisions. Too often organizations create and blindly follow step-by-step processes that impede creative strategic thinking. Anyone who raises questions, challenges assumptions and is resistant to sitting in meetings following a tedious step-by-step activity may be characterized as not being a “team player.” While employees may be encouraged to “develop an insatiable curiosity about the business” they also may learn it does not mean to actually consider new ideas, processes or direction since these are left up to “senior management which has a better handle on things.” The problem, as research has found, upper management often does not have a handle on things.

While there is no shortage of books written about the reasons strategic thinking is important, writers have tended to focus on the personal attributes of strategic thinkers and on the characteristics of strategic thinking. Sloan identified several factors including informal learning, life experiences and intuition when combined with some level of analysis can lead to an individual learning how to think strategically. Focused more on the organizational attributes of strategic thinking, Goldman highlighted life experiences with family, education, work, mentoring, activities, risk taking as important, Ebersole outlined nine steps strategic thinkers typically follow while Johnson and Johnson of Changemaking Systems, LLC., raised questions a “coach” should consider when working with individual(s) or companies to enhance strategic thinking.

Leadership roles in new projects, monitoring results and creating performance metrics as well as dealing with potential business survival issues are significant traits found in strategic thinking executives. But did these attributes cause strategic thinking or are they merely a reflection of how strategic thinking people behave. A key question Johnson and Johnson neglected to consider was whether coaches have developed their strategic thinking skills sufficiently to know how to teach others to think strategically.

Authors have defined strategic thinking in a variety of ways. Rich Horwath noted in his book on strategic thinking “Deep Dive”, that strategic thinking for a for-profit company was “the generation and application of business insights on a continual basis to achieve a competitive advantage.” Michael Gerber, “The E-Myth”, sees strategic thinking as a perspective about a business noting it “is not working in the business, but working on the business”. Ornoff commented that strategic thinking is a personal recognition and understanding that the person’s improved means or methods of work improves the organization.

Despite all of the books, seminars and workshops, the fact is, gauged by the numerous articles espousing the need for strategic thinking, executives, managers and staffs have not learned how to be strategic thinkers. While learning the personal attributes or general behaviors of people who are identified as a strategic thinker may be helpful, it does not teach a person how to develop the skill to think strategically. Does anyone believe by learning the attributes or characteristics of successful mathematicians a person can solve calculus problems?


Every day staff, managers and executives gather information and data, meet to decide a course of action and make decisions. Executives in particular make decisions which are significant in scope and impact. Isn’t that strategic? Unfortunately, the answer is frequently no. For staff, managers and executives, the information, data and decision making tends to be at an operational and tactical level and not strategic. An important lesson is to realize is that General Dwight Eisenhower, commander of all Western Allied Armed Forces in Europe, did not set the strategy for Allies. Rather his role was to successfully use the resources made available to him to achieve the defined and expected goals to win the war.

THE POWER TO QUESTIONTo think strategically a person must have learned the skill to question. A challenge for many managers and executives is learning to avoid the temptation to focus their thoughts and energy on finding solutions or answers. An important task in learning to think strategic is to ask questions that lead to more complex thinking. Are we doing the right things to make the business grow? Can we improve the business or service? Can we improve our connection to customers and be seen as having great value? These questions do not have immediate answers or even solutions. Strategic thinking is not about asking what or how questions to find solutions but questions that stimulate more thinking.

In Kenichi Ohmae’s work, “The Mind of the Strategist” he argues “successful business strategies result not from rigorous analysis but from a particular state of mind.” (p.4) He notes strategic thinking is different and requires a skill set different from those needed to solve operational issues and tasks. For Ohmae and others, analysis is not rejected but used differently. Ohmae believes that in the last few years with the heavy emphasis on data and “number crunching” the skill to ask questions has been replaced by managers seeking solutions and answers.

There are two critical reasons to learn to question. First, as often reported about Steve Jobs, he defined his role not only by what he accomplished, but by keeping the company working on the core elements of its business. An increasing number of CEO are learning, as Jobs did, that questioning an idea, possible product or a acquisition helps keep the business focused on what it does best. When Frank Borman became CEO of Eastern Airlines he cut 75 vice president positions after finding they had little role strategically other than sustain their positions. How many CEO and managers talk about getting back to the basics which made them great, but then fail to engage in the process of questioning?

Secondly, it is important to not only learn how to question, but to make it part of an organization’s strategic thinking culture. Although architect Mies Van de Roe is credited with the concept of “less is more” the mantra should also apply in the management of organizations. Howath compared raising questions to the practice to pruning plants and trees. To get flowers to blossom and trees to grow dead flowers or limbs need to be removed. He believes organizations need to do the same.

The need to question the allocation of resources, the usefulness of a product or services or the continuation of a service or product line should be an essential part of any for profit or non-profit organization. McKinsey & Co. surveyed thousands of major corporation executives to learn their views about resource allocation. Nearly one-quarter of the executives indicated they were funding, staffing and using resources on projects, services and or products that should have ended. A CEO for a multinational company realized after flowcharting the company it had 44 distinct businesses for which he was responsible. He began to cut the underperforming and


unprofitable ones and then had staff, money and resources to allocate to improve and make others more successful.

In “The Strategy Paradox” Michael Raynor offers another compelling reason to question. While emphasis has always been placed on the need for strategic think to counter sudden or acute changes in the marketplace, Raynor suggest that changes which occurs slowly over a long period of time may be more destructive. He argues that a strategy adopted to combat slow change continues often without further consideration until such time that the strategic course selected can no longer resolve the problem. Public pension funds offer an excellent example of slow change. This is not a sudden catastrophic event, the unfunded pension liability is decades old and well known. The course of action selected was to delay the funding. Unfortunately the delays have created a liability so large the only solution might be bankruptcy or at least significant cuts in pension payouts and changes to contributions.

The skill of asking questions is not easily learned. From an early age children are conditioned not to question. Students are taught to find answers to problems with less emphasis placed to develop a keen intellect or the ability and willingness to raise questions. A comparison between any elementary school classroom and a high school or college classroom demonstrates the effectiveness to the conditioning toward finding answers. Young students are eager to ask questions as most pre-school and even parents will attest. By the time they reach high school, students no longer question and are focused on making sure they have the answers, or at least the correct answers for the upcoming test. Many college students are reticent to ask any questions, whether fearing embarrassment or singled out as not understanding, even when they fail to understand the subject matter.

Strategic thinking involves the sort of questioning that evokes some measure of creativity; which is why in recent years there has been such a great emphasis to teach executives and managers to think "outside-the-box." Why teach people to think outside the box? In the quest to learn to think strategically, the process of asking questions actually has no limits. Managers and executives have learned to inhibit their expression of “crazy or off the wall ideas” to build barriers that hinder creative ideas and possibilities.

People often have creative ideas, but have learned not to suggest them for fear of ridicule or subjected to critical comments about getting serious about the issue at hand. As Ohmae noted, most corporate cultures inhibit questioning and creative thinking, which certainly seems counter productive. New employees learn not to question or make suggestions about improving processes, procedures or direction unless asked; which happens rarely. To the question of why teach executives and staff to think "outside-the-box", it might be better to ask: why do they get "inside-the-box" to think?

Bilton (2006) noted creativity is often viewed as being characteristic of people who are individualistic, are not "team" oriented and/or are unmanageable. Browse any management section in a bookstore and the titles send a similar message - learn how to manage creativity to get the most out of it. Is that not a contradiction? The private sector and non-profits spend considerable funds on programs devoted to teaching their executives and staff how to be creative thinkers, but at the same time often fail to recognize and reward them for unique solutions or ideas. Perhaps creativity is desired, just not too much creativity.

THE NEED FOR SPEED


Over the past few years the pace of business has accelerated as the impact of the Internet has increased the capacity and flow rate of information and advocacy. Social media, on-line movie streaming, blogs and consumer reactions has increased to the point that a small event or issue can quickly lead to immediate and substantial challenges for any organization. As a result, management must be strategically prepared and act strategically. The challenge for any business is to be able to react as quickly as events move. Perhaps the fastest paced organizations are those involved in auto racing.

What differentiates consistently winning racing teams from others since auto racing rules have standards about how cars and engines are built and assembled? With wining teams in auto racing, as it should be in most organizations, strategy is discussed and understood long before any race season begins. Selecting drivers (execs) is not just about who can put the “pedal to the metal” and go fast. Team owners and leaders find drivers who have a burning desire to win but are also willing to spend time learning the characteristics of how the car and the tracks interact. They are looking for drivers who understand the value of practice laps at each track learning how to transition from the straight-a-way, when acceleration is critical, to the turns, where finding “groove” is important. Drivers are looking for owners and team leaders who want to win consistently and who listen to the team and driver input.

Racing enterprises such as Team Penske, which has a record of consistently winning, has learned team performance and adjustments prior to any race is critical. Numerous people gather data about tracks, tire performance, new tire designs, advances in engine and automotive technology, identify how to “set-up” the cars to fit the characteristic of each track and measure performance levels of crews and drivers. Team leaders (CEO) review and constantly train their crews, since rules limit the number of crew (staff) “over the wall” when the car pits and how the entire team functions during the race since fractions of seconds matter so much in racing.

Race day provides little time for meetings to discuss changes or to create personnel procedures to make sure everyone understands their role. Once the race begins everyone must have practiced and to know what to do, how to respond quickly, and to think quickly to fit changing car needs and race conditions. During the race the team leader, although somewhat isolated above from the hectic activity below, is nevertheless constantly monitoring data from the car, getting information and data about other cars and teams, evaluating changes in the race when crashes and yellow flags occur. Throughout the race the team leader is leading the discussion whether anything can be done to improve their position and if so what in the quest to take the lead to win. Why do some teams constantly win while others seem to be far off the lead lap and end up back in the pack? They have learned to think strategically as a team. They have gathered data to improve their knowledge, questioned their experiences and considered new ideas, over and over again. Imagine during the off season no one bothers to ask as does Team Penske, Can we do better? Can we win consistently? Do we have the people and processes to become better? Are other teams that much better that we are? True, in many organizations there is no “off season.” But, it is also true that there may not be anyone asking strategic level questions. Setting the team goal to do better than last year is hardly strategic. Unlike most businesses that brag about their fast pace, in auto racing they mean it.

VALUING CONCEPTUAL MODELS


What role do business models have in strategic thinking and who has time t o consider business models? Research findings confirm strategic thinkers schedule time to think and use a variety of business models.

The reason to use the conceptual models and performance measures is two fold. First, research by Ciampas discovered, many executives lack a basic framework to aid their thinking. He found they had no plan or reference markers to use to identify appropriate sources of information, data collection or to evaluate the usefulness of advice or information. In the learning process it is important to provide some basic framework on which to build knowledge and understanding. Conceptual models also provide useful frameworks in which questioning can occur. Some of the best models also have the simplest frameworks. SWOT and all its derivations have as few as four squares. Because models provide a framework, but not solutions or answers, they help to keep the focus on the importance of asking questions. An increasing number of helpful business models have emerged in the last decade. Unfortunately, they remain unknown to many executives, managers and staff, particularly in the non-profit sector even though the models work for them as well as those in the for profit business world.

Second, conceptual models are easy to learn and implement. Most new staff members have had sufficient life experiences to probably be able to distinguish between what may be an opportunity, threat, strength or weakness within an organization. While their level of thinking may be relatively limited compared to more “seasoned” executive that is not the point. The emphasis should be on learning a process and how to use business models to improve their ability to raise questions and spark creativity. Imagine how creative and inventive many organizations could be if from the top management on down the use of “business” models were standard practice. Of course for some top managers that would mean sharing credit for improvements, a hurdle some executives and managers seem to stumble on repeatedly.

To demonstrate how models can help in thinking consider these simple models, Praedo’s Law, SWOT and the Law of Diminishing Returns. Praedo’s Law, is a simple and efficient model used to quickly provide measurement for almost any organization. Briefly, it is an 80%-20% benchmark: 80% of profits come from 20% of the services or products. 80% of the customers require 20% of the care, while 20% of customers require 80% of the care and so on. Although constructed in the 1800’s by an Italian mathematician studying distribution of wealth, it has been widely adapted to fit most organizations. Like all models it is not perfect, but for people new to models Praedo’s law is quick to learn, easy to apply and serves as a good performance measure.

A second model, its use regrettably limited too often to strategic planning sessions, is SWOT. There are a number of variations to this model, but the basic elements remain the same, identify Strengths, Weaknesses, Opportunities and Threats at any given time for the organization. While the SWOT model is not usually thought of as being conducted on a frequent basis, people who are strategic thinkers probably use some variation of SWOT and other business models while they are thinking. They may not have even consciously thought about which model they want to use because the use has become a routine part of their thinking.

Another model and one which could convince executives that managers and staff need to become strategic thinkers is the Law of Diminishing Returns (LODR). It can be used across the diversity of businesses, government and non-profits and from small to large organizations. Like other models LODR is not a predictor simply


because there is no model to adequately or accurately predict future events, particularly now in the Internet age. But, as a method to raise questions and stimulate critical thinking it serves a useful purpose. The recent crisis in housing lending is a good example of the Law of Diminishing Returns.

Pushed by the Federal government to make home owning a standard for every American, some lenders offered easy terms with little concern about the risk of homeowner to make the monthly payment. The lure of the quick and easy money was more attractive than turning down higher risks. While the model does not demonstrate all of the nuances and ripple affects that occurred as a result of poor business decisions, it clearly demonstrates there was a point where the risk would exceed the return on the investment. As the model below illustrates when loan risk was low the financial return for the lender was quite high, but as the loan risk increased the Law of Diminishing Returns reached a point where lenders should have ceased financing mortgages.

How does the LODR apply to organizations and strategic thinking? Consider what happens in any organization when only top management is engaged in strategic thinking. As information and data is sent vertically to top management it is filtered and reduced, sometimes deliberately often times to simply minimize the volume of information and data available. When a limited number of people are solely responsible for strategy, and who do not see all the data, the risk to incorrectly interpret provided information and data increases.

This may also help to explain to executives and managers why, in today’s Internet environment, the speed of outside forces to share information can outpace the speed of an organization’s internal communication structure. Thus, by the time the organization’s management correctly assess what it should do or say, it is too late and they face additional issues or sound out of touch with what is occurring thus compounding the initial problem.

Models are not designed to predict specific issues or pose solutions. Models are useful to help teach and improve the skills to question, to think more creatively and to help develop the skill to think strategically.

THE SUM IS GREATER THAN THE PARTSResearchers investigating how people learn have found that strategic thinking differs from “normal” thinking in a number of ways. Strategic thinking is purposeful and focused. It follows a pattern or process and is not random thought. It occurs at the


Loan risk

Financial lender return on investment

Information and data available

Error risk

conscious and subconscious level. People are often amazed to discover a solution when they stopped thinking about it. They “let it go” later realized the solution. That is an example of how strategic thinking functions. Strategic thinking is a level of thinking that cognitively brings together and assembles data and information with previous knowledge and experiences so that when combined with creative thought and questioning can produce thoughtful ideas and logic.

Writers have identified numerous elements fundamental to the strategic thinking process. For the purposes here as an introduction six have grouped together into three component parts, similar is function yet different in how they contribute to strategic thinking: Data and Information, Knowledge and Assimilation, and Creativity and Vision.

The first two, which some organizations over emphasize, is Data and Information. Information is not necessarily data and data may not yield any information. While the collection of data and acquisition of information is a necessary condition for strategic thinking there is a point at which data and information provides no useful purpose. The law of diminishing returns supports such an assertion. How many people have labored getting more information only to realize it added little to better understand the problem, the issue or the possible solution?

Many organizations gather data without considering whether the data provides useful information or whether the collection of the information serves any purpose, other than the collection of data and the gathering of information. As many managers and executives will attest, too many meetings are little more than the repetitious deliverance of data or information without meaning. Far too many meetings and conferences are obese with information while their attendees are starving for knowledge to help them improve performance in their work or tasks.

The second two components are Knowledge and Assimilation. Knowledge is the result of thinking about the data and information and forming connections to provide meaning and useful purposes. Bellinger points out "While information entails an understanding of the relations between data, it generally does not provide a foundation for why the data is what it is, nor an indication as to how the data is likely to change over time." Knowledge results when data and information fit into a thinking process that has meaning and usefulness to the individual.

Knowledge must be connected to an action to be useful. This connecting of knowledge to action is Assimilation; defined as the application of knowledge into a useful purpose or action to cause change. When knowledge begins to be connected into patterns or frameworks, which is then connected to previous experiences and current situations, the process of strategic thinking becomes possible.

The third component includes Creativity and Vision. Writers on the subject of strategic thinking agree it is inherently linked to creativity. Innovation, changes in procedures or new approaches imply some sort of creative thought process has occurred. Unfortunately, as noted earlier there are a number of barriers that can hinder creative thinking in organizations.

Vision is defined as the ability to imagine or consider something different. Granted operationally it may be difficult to actually carry out a new idea, process or produce a new service or product, but rejecting it outright shuts down the processes of considering workable solutions to new ideas and thoughts of what could be. Thankfully, NASA had people who, when challenged to place a man on the moon,


focused on what was needed to make it happen rather than highlighting the risks, the existing technology and the fact that it had never been done.

The challenge for many organizations is to effectively translate the vision into workable solutions using the available resources or developing new resources to cause the action to succeed. Larry Bossidy and Ram Charan authors of “Execution” point out executives and managers need to better understand the importance of execution in order to successfully carry out any strategic plan that results from strategic.

The following graphic might help to illustrate how these components interact. When an individual brings the components together to cause an interaction it provide the opportunity for strategic thinking.

EMPHASISING THINKING STRATEGICALLYSome companies are realizing the need to actually teach current executives and managers to think strategically. They have begun to use simulation and business game playing as their teaching method. Game playing lets executives and others engage in new ventures, new measurement techniques and risk taking that they might not do under real business decision situations. In much the same way that war games have been used in the military for years, business games help teach lessons without the worry of ending a career, actual loss of profits or confronting personnel who are resistant to change.

Can we teach people to be strategic thinkers? Do we need to teach new staff who supervise no one and who have little experience to become critical thinkers and capable to ask compelling questions? Can a staff member learn the skill to think strategically when their more experienced and/or perhaps older managers and executives do not think strategically? The answer must be yes, since countless organizations, businesses and government spend untold dollars on courses, workshops and seminars with speakers about creative thinking, strategic planning, strategic goal setting and thinking strategically.

Is it possible for young staff members to learn to assemble data and information combine it with experiences and knowledge apply creativity and vision to it to cause strategic thinking? Can they learn to do this continuously? Research seems to support the notion strategic thinking skills can be taught and all organizations would benefit by having more people who think strategically regardless of the person’s position or title.

Perhaps, as Ohmae and others have suggested we might be trying to solve the problem before thinking about the issue. Maybe we need to ask a different question. It is not whether people can learn to be strategic thinkers, rather are there are better ways to teach the skill of strategic thinking than has been done in the past? Perhaps


Creativity and Vision

Strategic thinking

Data and Information Knowledge and Assimilation

what is needed are different approaches to teaching the skill. If, as Horwath suggested, the grade for strategic thinking among executives is at the 58% percentile, it might be time to consider options in teaching methods.

What is needed is a training process to help develop the skill to think strategically not just for executives, but staff including new staff. The process must have a framework in which the various components of strategic thinking interact. Further, it should be provide a useful purpose and not something without value to the user and organization. Finally, it must challenge the user to think critically about how the organization functions, how resources are connected and assigned and where efficiency and changes could yield thinking that leads to more effective management and improved organizational outcomes. Perhaps developing functional flowcharts might be the first step in learning how to become a strategic thinker.

Developing a flowchart requires thinking about data and information in a structured and logical order and can be accomplished without the pressure of solving a problem or finding a solution. Flowcharts also provide the opportunity to view an organization, system or process as a collection of details and as part of a larger picture. While new staff may construct limited or simple flowcharts, senior managers should be expected to visually identify complex relationships and work flows. Developing flowcharts can help individuals, staffs and executives think about options or creating different systems or processes that may lead to changes in how operations are structured and how personnel are assigned. It also causes people to begin to ask questions about the organization and how it is organized and how it functions.

FLOWCHARTSFlowcharts came into vogue in the late 1940’s and early 1950’s with the growth of computer technology. They served as a way to visually demonstrate the path for logical decision making that computer programs and more importantly the programmers required to write the coded instructions. The use of flowcharts to graphically represent decision processes expanded beyond computer programming and is now used by numerous types of businesses.

Even with the most sophisticated of applications, flowcharting has remained, unchanged in its core function: to demonstrate workflow and where decision making must occur. For this reason, flowcharting serves as an appropriate exercise to learn how to first think logically and then strategically. The logic comes from diagramming the operational work flow paths. Higher level thinking, which can later become strategic, occurs as the person thinks through the processes and begins to analyze how the system or parts of the system function and where systems could be improved.

A flowchart is relatively simple diagram: usually arrows and lines represent the work process and flow, squares represent activities and tasks and diamonds represent decision points. Admittedly there can be broken lines and subtasks indicating more complex routine, but these also follow the common graphic language patterns. Yet, for the purpose of learning how to think strategically, the only thing that matters is to be able to graphically demonstrate work flow and decision points. It matters little if decision points are diamonds or squares, or worry about the various language conventions used in flowcharting. Flowcharts also offer a rich visual resource and a useful visual framework to aid in training new or existing staff to begin how to think strategically.


A word of caution about developing flowcharts is appropriate at this point. Flowcharting as a teaching method should not be confused with developing exquisite or artistic multi-colored chart s. Doing so misses the intent of the process. The purpose in using flowcharts is to provide a visual framework that is for the most part easy to construct that can also help to raise questions and how the organizational functions through various processes. Emphasizing the look of the flowchart misses the point. It is far better to have an executive diagram a flowchart on a scrap piece of paper and spend time thinking about the process, than create an attractive chart without spending much time thinking about whether it makes any sense at all.

Developing a flowchart is not the end of the process only the beginning for several reasons. First, flowcharts tend to be linear and workflows while situations and issues are not. The process of flowcharting is a step to teach people within an organization to ask questions. Can we do better? Is there a more efficient way? Is this all there is to the process? The chart will not provide the answers but developing a flowchart will stimulate thinking about the organization how parts interact or do not interact.

A NEW METHOD TO TEACH STRATEGIC THINKINGTo demonstrate how a flowchart be used as a teaching method consider a new staff member of the American Business Museum who has been asked to think about whether, not how, the Museum could improve its services to customers. Rather than looking at organizational charts or job descriptions, the new staff person begins by developing a simple flowchart. In the course of developing the chart the first question that occurs is: Does the museum make it easy for people to enter and enjoy the museum? While considering that question a second question emerges. Is it possible for the museum to improve its initial contact with visitors? Notice neither of these questions asks how, rather are Yes No questions which lead to more thinking not solutions. It is important for supervisors of direct reports and coaches of Executives and Managers to teach the importance to question not only find solutions or solve problems.

Seen below, is the staff member’s first flowchart of the interaction between the visitor and the museum.

To consider the question of whether the museum makes it easy for people to enter requires more information and more questioning: What the different forms of payment the museum offers for entry by guests and members? Are members provided different options than general visitors? Should there be different options or different treatment for members?

Investigating the payment options finds there are multiple methods and members utilize a member card and then begins to expand the flowchart. Looking at the recent additions to the flowchart, one could ask questions about the various forms of payment options. Which form is the most often used? What is the percentage of members to non-member visitors? Thinking more analytically one might want to know whether the cost for each process is different. It is important to remember that the flowchart is acting as a learning tool to help a person begin to think through processes, systems and to ask questions about performance, efficiency, effectiveness and cost to operate and manage. By not having to resolve an issue or to find a solution, the opportunity and importance to question comes to the forefront.


Visitor pays entry fee

Visitor in exhibits area until leaving

Visitor exits

Museum Opens

Probing for more detail person may request assistance from other department personnel who are in someway involved with the admission process. In doing so, the flowchart begins to become more complex as an example below demonstrates. Yet, while becoming more complex, the flowchart remains visually easy to follow. Note: As yet there are no departments identified or decision points identified.

Suppose, at this point the membership manager or CEO wanted to look at the flowchart, and after viewing it, asked the new staff person to develop a brief SWOT table. The result might be as simple as this next illustration:

Strengths Weaknesses

Museum offers a variety of payments methodsMost payment options provides funds before entry into Museum

Variety of payment methods poses challenge for new staff to learn quicklyNSF checks provides loss of revenue and possible increase in cost per ticket and staff time that could be better spent doing other tasks

Opportunity Threat

Museum point of entry is an excellent place to Other museums offer web payment options


Payment Credit cards

Checks

Cash

Member cards

Gift Certificate or other form of payment

PatronPaymentpresented

Credit card

Check with ID’s

Cash

Member card

Gift Certificate or other form of payment

staff initials, stamped put in register

Checks reconciled at closing

Checks to accounting

Checks deposited

Check paid by Bank

Funds deposited in bank

NSF return process

Card swiped

Card verified and charged

Receipts sent to accounting

Card issuer processes payment

Monthly statement produced

Funds Reconciled

Card declined process

New method ofPayment

No admittance

NSF payee notification process

Individual(s) enters Museum

Day CC Charges verified

No ID’s

highlight benefits of membershipMuseum can use tickets and payment stubs to advertise membership

Other museums are considering smart phone payment options.Other museums have removed more costly options

The combination of the flowchart and SWOT may prompt more questions and in the teaching process raise the discussion from an internal review to a market level comparison of the museum and its competitors.

FLOWCHARTS AS A TEACHING TOOLThe advantage and the focus of flowcharting should be on teaching the staff member or executive to first look at what the organization is doing or suppose to be doing and before considering anything else. What a flowchart can do, especially if the chart represents larger and more sophisticated processes is to focus attention on what happens and not initially on whose responsibility it is to make it happen. The departments performing the tasks are important, but the reason to use the flowchart is to facilitate developing the skill of strategic thinking.

As a teaching tool, consider how much can be learned by looking at the last flowchart. Suppose as part of new staff training process they were asked to construct a flow chart and then were asked, What do you think about all of this? They might focus on the process, or identify new methods or simply question why it needs to be so complicated. Should it be so complicated? This is An excellent question and one that managers frequently confront. How could it be less complicated? People who study and are certified as Six Sigma specialists confront these questions constantly as they work to find solutions to make processes and operations better.

The flowchart as developed could be used to teach staff from a number of departments about the interrelatedness of the work as they complete what may individually see as a repetitive of little value process. Consider how many departments might be involved in this process directly or indirectly. From the flowchart developed suggests there would be staff from: Membership or Member Services, Security, Accounting, Maintenance, Sales and Marketing. If the museum is larger and more compartmentalized it could even include Purchasing, Facilities or Operations, HR and even Development personnel. That is a fairly complex group, yet more and more companies and hopefully non-profits have realized the benefits of developing cross functioning teams.

As a tool in the teaching tool flowcharting can also help staff and executives to understand the process of decision making. Good decision making follows a process and the value of the elements identified earlier should be viewed in their context to their application to build a flowchart.

INFORMATION AND DATAIt is important to remember first and foremost information is not necessarily data and data does not necessarily provide information. In today’s Internet and social media rich environment so there is so much information that it is difficult for most to make sense of what is useful. To build a flowchart the first requirement is to gather information and data.

Identifying first what information and what data to collect is no small task. Next, the question of how much data and information needs to be explored.

Once developed, a flowchart can serve as a mechanism to facilitate discussion about processes and operations. Again the focus should be not on finding solutions, but asking questions. For example, what are the costs and benefits associated with all


the payment options? What potential risk does each of these options pose for the museum? Is there one method which adversely impacts staff training and retention cost? What are other museums doing regarding payment of entrance fees? The focus should not be initially on finding answers but the asking of questions and determine which of the questions are most important..

KNOWLEDGE AND ASSIMILATION As highlighted earlier, once information is learned and data gathered it must be connected and acted upon to be useful.Looking at this last flowchart think about the training time and cost for a new staff person to learn and be able to perform all the payment process. Does the museum staff know whether the existing training procedures insure the staff can complete the steps needed for each payment methods? Do they need to know all options? Could the process be changed to produce more effective and efficient process? These questions can serve as powerful starting points to generate a wide range of discussion and possibilities to imagine. They can also be the starting point to learn to think strategically on a regular basis.

CREATIVITY and VISIONFlowcharts provide an advantage as a powerful teaching tool often missed, the value of visual representation. Consider the difference between what is visually represented in the flowchart to a document that explains the same thing. How many people, including the best and most capable executive, would be willing to read what would be a volume of pages, compared to looking at the single page of a flowchart. Humans for their earliest moments are visually cued and the flowchart can help people “see” a process.

A flowchart provides a visual representation of what is, but can also lead an individual to consider what could be. Looking at the flowchart developed how easy would it be to make changes in the process? For the most part fairly simple. Consider what it would take to describe making the same changes but in text form. The flowchart as a teaching tool may be able to stimulate people considering other options IF, the organization emphasizes creativity as a necessary function of management. As long as management encourages creativity, the vision to look at what could be will be more productive to produce real change in an organization.

Management including CEO’s might look at this same chart and use it to build a more cohesive staff and create an improved management model. Suppose, rather than having all of those typical departments, the museum staff was assigned differently by combining personnel around functions rather than staff expertise and work. Instead of the typical departments the CEO and management built a team called Visitor Experience. It could include the same staff members even those more remotely connected but all focused on providing customers with a great experience. This team would be charged with building and retaining members, making it easy for visitors to enter, experience and enjoy the museum, providing marketing and sales materials and the typical processing of member cards, charges and sales at various museum outlets.

STRATEGICALLY THINKING MANAGEMENTTypically at certain times of the day the waiting line and times for entry into many museums become long. In a typical organization Membership, Operations or whom ever controls ticket sales and entry is tasked to improve the flow rate. That department executive and perhaps some staff have a meeting and make decisions. Sound familiar, probably, but it will it lead to strategic management?


Using a more strategic team centered approach to the problem a new team is tasked to come up with a plan to accomplish the following: develop a process to improve flow rate, make it easy for staff to adjust as needed, understandable to the customers and members while improving satisfaction, without spending considerable time retraining of staff, and to do it at the least cost in facility changes and personnel. That is a considerable task to accomplish yet with team properly assembled it is certainly doable, provided management has trained staff to think strategic and not territorial.

Or, like many others businesses, the museum management could simply let the customer deal with it, identifying it a one of the cost of operations that the business and its management has to endure. That seems to be the least strategic decision, but one frequently made by many businesses.

There is great potential for upper management to improve how they work and function as a team. Suppose upper levels of management met regularly to review a more complex chart that included all of their combined work flows. Like a racing team, rather than the responsibility of a manager to improve a department’s performance, the emphasis could be on whether improvements can be made to the whole. As a team, the capability of the group to “see” opportunities expands as does the possibility of some “out of the box” thinking. The emphasis should be to question what they see, not to find solutions. By becoming comfortable as a group to question they develop a culture and model behavior that can transcend the organization. By doing so, an organization can develop strategic thinkers at multiple levels and future leaders can learn, practice and hone their skill to think strategically.

CONCLUSIONWhile few would ever argue against the need for strategic thinking the evidence from research suggests the majority of businesses, executives, managers and staff do not engage in strategic thinking or have been sufficiently trained. While numerous books describe the attributes of strategic thinking, discuss elements or what make up strategic thinking, not many have attempted to create a framework that can teach a person how to begin to think strategically.

It would be a mistake to believe that flowcharts in themselves will lead to strategic thinking, but as a step in helping to teach a person how to strategically think it appears to be a worthwhile option. Is there more to strategic thinking than creating charts? Absolutely, but without a framework and the discipline to follow of process or some sort, strategic thinking will most likely remain an objective not an action. Strategic thinking will not occur as a result of sitting in meetings for the purpose of holding discussions or reaching a decision.

In an effort to maximize efficiency most organizations are built around department structures. While helpful in many ways these same departments become competing elephants when trying to produce a product or provide a service, and can be a hindrance in responding to a crisis. Further they often lead to the reduction of strategic thinking rather than enhancing the effort to produce strategic thinkers. No wonder there are small sparks that result into raging infernos that require significant effort by everyone in the organization to respond.

The question many managers and executives need to consider is whether strategic thinking will become a priority for them, for their organization and for their staff? When will they clearly and succinctly define a strategy, review their tactics, hold


practice sessions for their “pit” crews and for their “drivers” to improve their performance as a team? When will the team learn to think strategically both individually and as a team? Can you imagine the pit crew member responsible for filling the car with gas making a decision about how to speed up pit action without consulting everyone else? In most businesses and organizations that is what happens.

The potential for strategic thinking exists in most individuals. The challenge is to recognize and embrace the idea that strategic thinking will not limit a Board’s, an Executive’s or Manager’s responsibilities or talents. What teaching and emphasizing strategic thinking may do is lead to greater recognition and appreciation of the organization’s ability and skill to recognize and utilize the skills possessed by the greatest resource it has, its personnel. To teach staff, managers and executives to become or improve their strategic thinking skills, flowcharts offer one method that ought to be considered.


References

Corporate Lifecycles, How and Why Corporations Grow and Die and What to Do About It; Ichak Adizes, Adizes Institute Book, Prentice Hall, 1988

Leading At a Higher Level, Ken Blanchard, Blanchard Management Corporation, Prentice Hall, 2007

Can Boards of Directors Think Strategically”? Some Issues in Developing Direction-Givers Thinkers to a Mega Level, Bob Garratt, Performance Improvement Quarterly, Hoboken, 2005, Vol. 18, No. 3.

Deep Dive, Rich Howath, Greenleaf Book Group Press, 2009

Developing Strategic competencies: A starting Point, Keith Ornoff, Information Management Journal, Lenexa, July/Aug 2002, Vol. 36,

Developing strategic thinking as a core competency Ingrid Bonn, , Journal of Management Decision, Emerald Publishers April 2001 No. 1 Vol 3 pp. 63-70

Developing Strategic Thinking skills: What are the core competencies of Strategic Thinkers?, Dr. Farid Muna, Innovation and Improvement.com, May 5, 2011.

Execution, Dave Bossiday and Ram Charan, Crown Business, New York, NY 2002

Thinking strategically at every step, Elaine Yin, Training and Development in Australia, Surrey Hills, Oct. 2010 Vol. 37 Issue 5.

Strategic Actions for Learning How to Think Strategically, According Your Strategic Thinking Business Coach, Glenn Ebersole, Ezine Articles, March 21, 2008.

Strategic Thinking, Changemaking Systems, LLC., http://www.changemakingsystems.com/strategic_thinking.html, John Johnson and Molly Johnson.

Strategic Thinking – The Meaning Behind the Buzzword, Stever Robbins, Stever Robbins, LLC., Blog posting Aug, 2011.

The E-Myth, Michael Gerber, The Mind of the Strategist, Kenichi Ohmae

The Strategy Paradox, Michael Raynor

The Value of Knowledge Management, Business and Organization, Knowledge Management, Gene Bellinger, www.systems-thinking.org/index.htm, p2. 2004,

What is Strategic Thinking Center for Applied Research, , Briefing Notes, CFAR, Cambridge, MA, 2001, www.cfar.com

Strategic thinking for information technology, Bernard Boar, John Wiley & Sons, New York, 1997,

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Strategy Magazines


http://www.cfar.com/

ABOUT THE AUTHOR

Mr. Neils’ career includes management and executive positions in for-profit and not-for-profit organizations. Early in his career, he returned to academia and became interested in researching organizational goals, performance measures and financial returns on non-profit organizations. Although his published works are often directed toward non-profits, his concepts and analysis are equally applicable to for-profits as well.

As his career progressed, Mr. Neils recognized the day-to-day demands on executives, especially managers’, were most often at the tactical decision level, leaving little time to improve or develop strategic skills. As a result, he developed a keen interest in strategic thinking.

His first work was Using Conceptual Models to Improve an Executive’s Strategic Thinking. This paper was a theoretical exploration of conceptual models and strategic thinking. Adapting Abraham Maslow’s “Hierarchy of Social Needs” Mr. Neils examined how internal and external forces act on organizations and executives.

Following that, he began to investigate how executives might integrate creativity as a way to improve strategic thinking skills. This second article Creativity, Strategic Thinking and Statistical Models questions how commonly used statistic models and creativity might aid an executive’s and staff’s skill to think strategically.

Because of the interest generated from these articles, he began to investigate how managers and executives learned to think strategically. His research found most emphasis to be on attributes of strategic thinking people and the need to think strategic, but little on teaching methodology. This prompted, Developing the Skill of Strategic Thinking in which he suggests flowcharting as a possible method to teach staff, managers and executives to become strategic thinkers.

Mr. Neils wrote What non-profits can learn from the Obama Campaign in response to an engagement where he argued the need for non-profits to improve their use of data and data analysis.

His work Team Building In a Culture of I began after attending a convention of Human Resource managers and recognized the strong interest in team building. Mr. Neils explores how cultural forces in the US, that emphasize the value of the individual is a unique component and has yet considered by authors who study team building and by management as they identify person to become part of a team.

Recognizing the impact the Internet had on business and the vast amounts of data that it provides Mr. Neils has turned his attention to what organizations do with the data they collect or could collect. His work Improving a Non-profit’s Collection and Use of Data attempts to reduce the anxiety about data, data collection and analysis.

Currently, he is working on a follow-up piece that explores fund raising and why nonprofits need to be using on-line crowdfunding applications. This brief essay, Are You Still Using a Bobber and A Worm to Fish for Funds will be published soon.

Mr. Neils belongs to several LinkedIn groups on non-profit management, strategic thinking and performance measures as well as involved in organizations focused on developing improved management, measurement and technology applications for nonprofits. He can be reached at [email protected].


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