• Autonomy: the personal freedom to act as we see fit to implement a strategy
• Mastery: the fulfillment that comes from developing a high level of skill in a valued area
• Purpose: a sense of meaning, value, and making a difference in our work

Leaders who want to get the most from their organizations will need to find ways to build intrinsic motivation qualities like these into their organizational cultures.

In the TED talk below, titled “The Surprising Science of Motivation”, Dan Pink makes the case for leaning toward intrinsic motivation in organizations.  Examples he sites where this has worked extremely well are Google’s 20% time, Results Only Work Environments (ROWE), and Wikipedia.

We updated the visual look and improved the slideshow examples of our work.  The site is now “flash-free”, so animations run quicker and work well on iPhones and iPads.

Almost every page has been rewritten to update the material and refocus our value proposition.  We’ve simplified the service offerings to reflect the latest developments in our work.  There are now 3 levels of depth and rigor in our strategic planning work, ranging from Strategic Visioning, to Strategy Mapping, and finally to the most rigorous, Strategic Decision Analysis.

We’ve focused on the themes that infuse everything we do and differentiate us from typical strategy consultants:

• Working with large, live visuals to clearly communicate and see the big picture.
• A collaborative, facilitative approach to designing strategy.
• Leadership development built into our strategic planning work.
• A holistic, integral approach to strategy that embraces sustainability.

A multitude of improvements were also implemented across the new website:

• We improved the “contact us” and “newsletter signup” forms to make them much easier to use.
• We are now using fonts hosted at TypeKit to improve the readability of the website and give it a more unique look and feel.
• The photography in the headers has been improved and given more space to communicate the essence of the brand.  One of my hobbies is nature photography, and I’m happy to be able to showcase my art in a way that conveys meaning to my work in the business world.
• The menu system is redesigned and now responds instantly to user interaction.
• We set up a caching system so that pages will generally load in a second or less.
• We took advantage of CSS3 for some of the styling, which allows sophisticated shadowing with needing to load lots of images.  Unfortunately, users with versions of Internet Explorer prior to IE9 will not see those enhancements.
• A “Quote of the Moment” sidebar element has been designed to rotate randomly selected quotes about strategy and leadership.
• The newsletter has been redesigned to reflect the new website design.

Check it out!  I’d love to hear any feedback or answer any question you may have.

To answer this challenge, I developed the Global Trends investment program. Based on analysis of 38 years of data across more than 30 markets, Global Trends is a quantitative trend following strategy designed to make money in up or down markets. By diversifying across far more markets than just U.S. stocks, trends can always be caught somewhere in the world.

The Global Trends strategy enters long positions in up-trending markets and short positions in down-trending markets. It constantly monitors worldwide markets in stocks, bonds, currencies, metals, energies, and agricultural commodities to find the highest potential trends in the most uncorrelated markets.

Backtests of this strategy over 38 years with actual market data showed an average annual return of 46% with a maximum drawdown of 20%. Performance of real accounts with actual transactions over the past 21 months have seen an annualized return of 82.8%.

More information is available on the Blue Summit Advisors web page, including details about the strategy, market diversification, minimum account sizes, fees, and performance. This program is offered through separately managed accounts.

Appreciative Inquiry Process

I was recently asked to facilitate a planning process for the Board of Directors and a few other stakeholders of a non-profit service organization. I chose to use a process called Appreciative Inquiry (AI) because I felt it would be a good fit for the culture of the organization. AI is based on the assumption that organizations change in the way they inquire — an organization that inquires into problems or difficult situations will keep finding more of the same, but an organization that tries to appreciate what is best in itself will find more and more of what works well.

AI was adopted from work done by earlier action research theorists and practitioners and further developed by David Cooperrider and Suresh Srivastva in the 1980s. It has been used in a wide variety of businesses, non-profit organizations, educational institutions, communities, local governments, and religious institutions to envision and create change. It is particularly useful for large group, multi-stakeholder situations because it seeks input about the positivity of an organizations past and potential future.

The basic assumptions of AI are:

• In every society, organization, or group, something works.
• What we focus on becomes our reality.
• Reality is created in the moment and there are multiple realities.
• The act of asking questions of an organization or group influences the group in some way.
• People have more confidence and comfort to journey to the future (the unknown) when they carry forward parts of the past (the known).
• If we carry parts of the past forward, they should be what is best about the past.
• It is important to value differences.
• The language we use creates our reality.

As you can see, AI is as much a philosophy as it is a process of organizational change. There is a considerable amount of theory and research backing up the principles of AI, largely based on the developing science of Positive Psychology. Some of these principles would be considered rather novel in the mainstream business world. The eight underlying principles of AI are:

1. The Constructionist Principle. Words create worlds and reality is a socially created construct, created through language and conversations.
2. The Simultaneity Principle. Inquiry creates change – the moment we ask a question, we begin to create change.
3. The Poetic Principle. What we choose to study makes a difference. It describes and even creates the world as we know it.
4. The Anticipatory Principle. Human systems move in the direction of their images of the future and the more positive the image, the more positive the present-day action.
5. The Positive Principle. Momentum for large-scale change requires large amounts of positive affect and social bonding. This momentum is best generated through positive questions that amplify the positive core.
6. The Wholeness Principle. Bringing all stakeholders together in large group forums stimulates creativity and builds collective capacity.
7. The Enactment Principle. To really make a change, we must ‘be the change we wish to see’.
8. The Free Choice Principle. People perform better and are more committed when they have freedom to choose how and what they contribute.

AI is a particular way of asking questions and envisioning the future that fosters positive relationships and builds on the basic goodness in people and the organization. In so doing, it enhances the system’s capacity for collaboration and cultural change. Appreciative Inquiry uses a cycle of 4 stages:

1. DISCOVER: The identification of organizational processes that work well, focusing on strengths, best practices, and values.
2. DREAM: The envisioning of future states and processes that could work well in the future, given the nature and capabilities of the organization.
3. DESIGN: The planning, design, and prioritizing of processes and aspects of the organization that could realize the dream.
4. DESTINY: Implementation planning of the proposed design and action planning to strengthen the capability of the system to sustain ongoing positive change.

I found this process to be very useful and powerful with the non-profit organization I worked with. It suited this group well to focus on appreciating and envisioning the positive, because the group already had an appreciation-based culture, and had a strong vision of creating positive change in the world.

I believe AI is potentially a very good planning process to use in situations where there are multiple stakeholders that need to be included, a mission of creating positive social change, or where a bottom-up cultural change is needed.

I also found that Appreciative Inquiry lends itself very well to a visual mapping approach. Each of the four stages can be designed as a series of exercises and maps that guide a group through the process.

First, studies show that layoffs tend to result in an exodus of valuable employees. Second, making cuts across the board compromises your organization’s competitiveness in the longer run. And third, abandoning your growth strategy will leave you unable to take advantage of the inevitable upturn when it comes.

So, what are we to do? Difficult times require extra effort and creativity devoted to strategy. Your strategy needs to be much more than a plan for growth. It needs to address all the issues that a downturn brings, be robust against a range of possible downturn scenarios, and prepare the organization for growth as the economy recovers. Here is a top 10 list of guidelines to consider:

1. Explicitly address economic scenarios. Look at a wide variety of economic scenarios (demand, growth rates, interest rates, competitors, etc.) and map them out. Determine the likelihood of each scenario occurring. Consider what would happen when multiple scenarios interact. Test out what will happen to your business in each scenario. Finally, devise strategies that will work best in each scenario.

2. Take measures to cut costs and improve efficiency. Take this opportunity to weed out less successful products from your product lines. Cut corporate “luxury” items, like entertainment, travel, and conferences. Be careful not to cut costs that are core to the business and might compromise its competitiveness. And be careful not to over-react to the downturn as well. Rather than cut costs across the board, perform “surgical” cost cutting that removes the expenses that are the least productive.

3. Generate and conserve as much cash as possible. Balance sheet flexibility is critical in an environment like we have today. Prioritize projects and investments for their ability to generate cash in the near term. Extend payment terms where possible. Get accounts receivable up to date. Think about ways to turn assets into cash, such as selling plants or equipment and lease them back.

4. Identify risks and develop mitigation plans. Create a catalog of all the risks your business faces. Identify what could happen and the likelihood of it happening. Pay special attention to risks that are more likely in a recession. Then develop actions that would help mitigate each risk. Also think about ways to track each risk so that you are not blind-sided by a downside case.

5. Monitor the financial health of partners and vendors. Businesses can be badly disrupted if a key supplier or partner goes under. Develop a system for monitoring these companies and have backup plans or multiple sources for business-critical parts, systems, and services.

6. Evaluate potential mergers and acquisitions. Some of your competitors and suppliers may be hurting worse than your company. This could be a good opportunity to grow through M&A at fire sale prices if you have the resources to pull it off.

7. Maintain long-term planning. Create a team or steering committee to plan for future growth when the economy turns around. It’s important to integrate the long term and short strategic needs, and be able to hit the ground running when the inevitable upturn happens. It’s also important to stay clear on what your competitive advantages and strategies for growth are, so you don’t compromise them in the interest of managing for the quarter.

8. Manage culture and motivate staff. In a downturn, it can be increasingly difficult to motivate employees, especially if there are layoffs. Work to improve communication as much as possible, create forums for employees to air their concerns, and sell them on the benefits of working for your company. A downturn may also represent an opportunity to recruit valuable staff from struggling competitors.

9. Build (or at least maintain) market share. Despite the temptation to do otherwise, keep spending on marketing. Develop a strategy for growing market share even as the market temporarily shrinks. If competitors are struggling, you can grab customers from them. Understand what you are good at relative to your competitors and how that can help you in a downturn. Make sure you don’t lose your competitive edge through cost cutting.

10. Pay attention to where the opportunities are. Some divisions and businesses may be impacted by the downturn differently than others. Be prepared to shift resources and focus. Have a clear strategy of how to manage your portfolio of businesses or products — some may need extra resources while others can be “milked” or grown.

There is much more that could be said about this topic, but I wanted to keep it concise and limited to a “top 10″ list. If you’re interested in working on any of these in your organization, give us a call!

• The quality and completeness of your existing vision and strategy
• The robustness of your existing strategy to various recession scenarios
• How well you are on track to achieve your desired goals

We then work with you to explore options for filling the gaps to improve your vision and strategy, and be better prepared for whatever this recession has in store.

For more information or to schedule an appointment, contact Konrad at 415-927-8070 or via the Contact Us page.

One thing that seems clear about recessions is that they cause significant industry shakeups. Some companies that were leaders in their industry fall from their heights, and others rise to take their places. McKinsey compiled a data set on the last recession (2000-01), and found that nearly 40% of leading U.S. industrial companies toppled from the first quartile in their sectors during that recession. About a third of leading U.S. banks fell as well. During the same period, 15% of companies that had not been industry leaders prior to the recession vaulted into the top quartile during it.

The are many reasons why some companies lose leadership positions during recessions and others gain them, but it generally comes down to smart planning and decision-making. See my article Strategy in a Downturn for best practices companies can use to maintain or grab leadership positions in their industries.

Powerful strategy is the living, breathing force behind the actions of an organization.  It is the bridge that connects people from where they are to where they want to be.  It’s bold — definitely not business as usual — because it continually changes how the organization sees itself and transforms it into what you want it to become.

How can we bring this kind of life and boldness into our strategic planning efforts? I propose that creativity is the key to this, and that there are a variety of tools and techniques that are well suited to engaging people and tapping into their creative juices.

Mind Map Brainstorming. The word brainstorming has become an ubiquitous term for creative thinking. The core principle of brainstorming is to suspend judgment during the generation phase of thinking. Analysis, prioritization, and judgment take place after ideas are generated. This frees the mind to make connections and abstractions, shift perspectives, and explore alternatives without the constraints and structure that judgment brings. Unfortunately, typical group brainstorming sessions fail to be productive for a variety of reasons — judgment creeps in, ideas are not tracked, connections are not supported, etc. How can brainstorming be made more effective? I find that facilitated sessions with mind mapping software provide tremendous advantages over typical brainstorming sessions. Ideas can be captured and tracked with total freedom of association. Through powerful yet simple visualization, new ideas and connections are encouraged. At the end of a session, the group has a map of all the ideas generated in the session, which encourages further connections and ideas to develop after the meeting.

Improvisation. If you’ve ever seen an episode of “Whose Line Is It Anyway?”, you know what I mean by improvisation. It’s the practice of acting and reacting, to create in the moment and in response to one’s environment. Techniques of improv are widely trained in the entertainment arts (music, theater, and dance), but it is not well known that it can be a powerful tool in business planning. Its secret lies in suspending judgment and accessing the creativity of the present moment. There is no time to censor or evaluate, only to respond and build. It’s interesting to note that the mental and emotional states needed to practice the art of improvisation are very similar to those of Zen, and many of the same concepts are used in both practices. When people who have a thorough understanding of their disciplines practice improvisation, the result can be the invention of new thought patterns, new structures, or new ways to act. I use improv to help groups develop a more creative vision by asking them to improvise what their organization could be like at some point in the future, and capture their thinking in a tool called a Cover Story Vision. The result can often include nuggets of creative possibility that are fresh and bold.

Backcasting. Backcasting is the opposite of forecasting. Rather than predicting the future based on current trends or actions, we look at a possible future state and seek to understand what trends or actions would need to happen to get us there. Backcasting is an incredibly useful tool for developing strategy, because it allows us to develop potential future states, or visions, and then work backwards to develop the actions and opportunities necessary to get us to those end states. Thinking this way can lead to entirely new possibilities compared to working directly with strategy, as most organizations do.

Strategy Tables. The sheer number of variables, actions, and resource allocations involved in strategy can quickly make for a very complex problem. Most leaders respond to this complexity by learning to follow their gut or intuition. But what if you want to develop strategy collaboratively and/or make the decision process and its assumptions more transparent? Strategy tables can help. Based on an analytical technique called morphological analysis, they allow us to map out all potential strategic options and structure them into a map of the “choice space”. Doing this allows people to see new ideas and develop creative combinations of them. Strategic themes can be “strung” through the table to clearly define and compare various strategies. I use a visual planning tool called a Strategy Spectrum to work with groups with complex strategic choices, and it usually leads to a wider range of options and deeper insight into why the chosen strategy is the best option to pursue.

Storytelling. Human beings are natural storytellers. People in all times and places have told stories. In organizations, stories become the fabric of cultures. Stories can be used to instill knowledge or values, communicate a vision or strategic plan, or to develop a culture. In the definition phase of strategic planning, stories can be used to flesh out visions and make them more real. Storyboarding and success stories can be used to help groups visualize their future with more clarity and creativity. In the communication phase, it is critical to get employees and stakeholders engaged with the new direction. Visual stories can integrate organizational information with visual metaphors and graphics to tell a story that makes learning more personal, powerful, and effective. I work with groups to develop Storymaps that can educate and align people around an organization’s history, a change in strategy, a new business venture, or an emerging vision.

Scenario Planning. The future is of course unknowable, yet strategy must be defined in the face of dramatic uncertainty. Scenario planning is a process that attempts to address this by defining a set of scenarios based on trends and facts about the environment. These scenarios are then examined to understand their stories, implications, and opportunities. Team members can then generate ideas for creating value particular to each scenario, and build strategies that are more robust across a wider range of future possibilities.

Benchmarking. One of the easiest sources for new ideas is to compare what we are doing to what others are doing. Through reading and research, teams can understand what other organizations are doing in their industries — and learn about best practices and standards of excellence. They can then brainstorm how they could embody these practices in their organization, and which could fit their culture and goals. A related technique that can yield new perspectives and ideas is to work with metaphors — organizations in unrelated industries that could serve as a metaphor for what we might want to be like. For example, we might ask a question like “What would we look like if we became the Google of the newspaper publishing industry?” The result can be a whole new way of seeing and communicating the organization’s direction.

Legacies. Working with legacies changes the question from one of “What do we want to be or do?” to one of “What do we want to be known for?” or “What impact do we want to make on the world/environment/community?”. Legacy thinking can work equally well on an individual level (“What would I want people to say about me in my obituary or at my 80th birthday party?”) or on an organizational level (“What do we want customers, stakeholders, or the press to say about us?”). Asking these kind of questions shifts perspective and can result in new ways of seeing the purpose and vision of an organization. It can also help a group expand its thinking beyond a short term financial perspective.

In this article I’ve tried to survey some of the most powerful creativity tools that work in strategic planning. Using them effectively is an art akin to a jazz musician’s use of the tools of his art. Many of them can be used in combination with each other. Processes can be designed to satisfy any level of depth or complexity, or any organizational culture. By combining and using these tools artfully, we can dramatically improve the creativity and boldness of our strategic thinking. I hope some of these ideas help you in your quest to bring more creativity into your organization’s strategic planning.

Take some time this month to look at how strategic decisions are made in your organization, and how much real creativity is infused in the process. You may want to use the Creativity Toolbox article to survey what kinds of tools and practices your organization uses on a regular basis.

What creativity practices are you or your organization good at? Which do you use regularly? Which do you think your organization would benefit from using more frequently or with more skill?

Consider taking some steps to bring more creativity into your strategic planning. Decide which tools or practices you want to bring in, and identify resources to help you do that. It could make a big difference in how your organization determines its direction, and ultimately in its long term success. You could even consider making some New Year’s resolutions around this topic!