“Creating Great Choices” is all about moving beyond trade-off thinking, to explore new and better ways of winning
September 19, 2017
Strategy is all about making choices.
Where to compete? How to be different? What to do, and not?
Today’s business leaders face more choices than ever. You could be in any market, segment or geography, or any sector for that matter. Leaders like Bezos to Branson will argue that you are limited only by your imagination, finding the capabilities for implementation consequentially through acquisition or partnership. Similarly in terms of your intent, why you exist, and how you share the value you create, then that is your choice. The biggest challenge for leaders is to make the right choices.
A book about making better choices is therefore both timely and essential. Canadian academic Roger Martin’s new book on “Creating Great Choices” is all about moving beyond trade off thinking.
When it comes to our hardest choices, it can seem as though making trade-offs is inevitable. But what about those crucial times when accepting the obvious trade-off just isn’t good enough? What do we do when the choices in front of us don’t get us what we need? In those cases, rather than choosing the least worst option, we can use the models in front of us to create a new and superior answer.
This is integrative thinking. Martin coined this phrase in an earlier book “The Opposable Mind,” where he described integrative thinking as an approach to problem solving that uses opposing ideas as the basis for innovation.
Now, he and Jennifer Riel focus on how integrative thinking works, and how to do it. The book includes fresh stories of successful integrative thinkers that will demystify the process of creative problem solving, as well as practical tools and exercises to help readers engage with the ideas. And it lays out a four-step methodology for creating great choices, which can be applied in virtually any context. The result is a replicable, thoughtful approach to finding a “third and better way” to make important choices in the face of unacceptable trade‐offs.
Here’s an extract from a recent interview:
What are the big challenges that CEOs face today?
One is the rampant short-termism i the modern corporate world. This i particularly a problem for the CEOs of publicly traded companies because the capital markets are so driven by short-term results.
Investors claim to be interested in companies prospering in the long run but they act in exactly the opposite fashion. This makes it very difficult for CEOs to balance the short-term and the long-term.
Most of them sacrifice the long-term in order to keep investors happy in the short-term. But that catches up with them when investors ask: “What is wrong with you; why aren’t you growing faster?” The answer: “We sacrificed investing for the long run years ago.”
The other is the management of talent. In the last couple of decades of the 20th century, talent woke up to the fact that it had overtaken capital as the most important asset in the economic equation.
Ever since, talent has been extracting more and more of the rents, leaving shareholders ever more frustrated.
CEOs have a tricky management challenge and balancing act. Part of their job is to ensure that they collect, nurture and motivate talent. But another part is to make sure that the very same talent does not appropriate all the value and leave shareholders with nothing. The irony is that CEOs are card-carrying members of the talent class and are extracting ever more value themselves. So for them, self-control is a difficult challenge.
What techniques and strategies do these leaders take to navigate these challenges successfully?
In general, they are not faring particularly well in the face of these challenges.
Many CEOs give up fighting the capital markets and just give them the short-term results that they want and then leave their posts before the consequences of their short-term focus manifest themselves.
And I haven’t found many CEOs yet who have figured out how to handle modern talent particularly effectively. Most complain about how tough it is to manage Millennials.
But I think their focus on Millennials obscures the fact that all talent is getting trickier to manage – regardless of their birth era. I never like to be dour but on these two fronts, CEOs are going to need to do better in the coming years.
How can CEOs win the respect of the people they are leading?
The key to steering boardroom strategy is to engage in a dialogue with the board. Very few CEOs do that. Most prefer to go to the board with a finished product and hope for approval. This approach tends to be unfulfilling for board members who didn’t join the board to rubber stamp the company’s strategy. The best approach is to go to the board with thoughts but be open to members adding value and insight. The mindset can be best characterised as: “I have a view worth hearing but I might be missing something.”
The same mindset is the one that garners the most respect from those the CEO seeks to lead.
What kind of leadership capability will be needed by future leaders?
It will be leadership that balances the need to exploit what the company is great at now with the need to explore to find the next competitive advantage.
It will be leadership that nurtures and motivates talent without letting talent make demands that are so excessive that they damage
It will be leadership that balances advocacy (“I have a view worth hearing”) and inquiry (“but I might be missing something that you may see”).
How can current leaders develop capabilities in their successors?
By far and away, the best thing a leader can do is model the behaviours that they wish to see emerging talent develop.
Everybody watches the leader of his or her organisation. If the leader is successful, everybody will attempt to mimic them.
So it’s largely impossible to develop talent in a direction that is different from what you do as a leader, unless of course you are an unsuccessful leader, in which case you have a bigger problem on your hands than people development.
What are your expectations for the future of work?
It is bifurcating into two distinct kinds in a way that is really problematic. One kind is jobs that need meaningful levels of independent judgment and decision-making. The other is jobs that involve following a superior’s direction – and not exercising meaningful judgment.
In the modern economy, the former types of jobs are getting better paid, and offer relatively high security and benefits, while the latter are getting worse paid, and provide little if any security or benefits. Even in the most advanced of economies – the US, for
example – the former jobs make up just over one third of the workforce. So the majority of jobs are structurally mired in low wages, security and benefits while a minority of jobs are the opposite. This is a key driver of rising inequality across virtually all advanced economies.
It represents the modern economic challenge – how to transform those ‘routine-oriented jobs’ into ‘creativityintensive posts’ that actually use the minds of the workers rather than treat them like low-end machines.
Playing to Win
Roger Martin is most well known for his simple approach to strategy – about where and how to play – and co-authored a great book “Playing to Win” with AG Lafley, the former CEO of Proctor and Gamble.
In his Learning Lab he puts a strong focus on strategy for implementation, ensuring that the choices you make convert into practical and winning action
He has featured on the Thinkers50 ranking of top business gurus for a number of years, ranked as one of the top thinkers, and also winning awards for his books:
You can meet Roger Martin at the next Thinkers50 European Business Forum which will focus on the challenge for leaders in making better choices, particularly in terms of harnessing the potential of new technologies, having a broader impact on society as well as customers, whilst also delivering financial results which enable the business to innovate and grow:
Roger Martin is the Institute Director of the Martin Prosperity Institute and the Michael Lee-Chin Family Institute for Corporate Citizenship at the Rotman School of Management and the Premier’s Chair in Productivity & Competitiveness. From 1998 to 2013, he served as Dean. In 2013, he was named global Dean of the Year by the leading business school website, Poets & Quants.
He has published 10 books the most recent of which are Getting Beyond Better written with Sally Osberg (Harvard Business Review Press, 2015) and Playing to Win written with A.G. Lafley (Harvard Business Review Press (HBRP), 2013), which won the award for Best Book of 2012-13 by the Thinkers50. He has written 24 Harvard Business Review articles.
In 2013, Roger placed 3rd on the Thinkers50 list, a biannual ranking of the most influential global business thinkers. In 2010, he was named one of the 27 most influential designers in the world by Business Week. In 2005, Business Week also named him one of seven global ‘Innovation Gurus.’
Roger is a trusted strategy advisor to the CEOs of companies worldwide including Procter & Gamble, Lego, IDEO and Verizon.
A Canadian from Wallenstein, Ontario, Roger received his AB from Harvard College, with a concentration in Economics, in 1979 and his MBA from the Harvard Business School in 1981.