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‘Straight line acceleration is not an option' said the CEO at the start of the senior leadership team away-day. ‘The changes that are coming around the bend represent a significant threat to our sustained performance. But, if we are agile and innovative, they can also represent a significant opportunity'.
CEOs see greater turbulence and change ahead, including the possibility of recession. To prepare for the future they are calling for a new way of working that combines speed and agility, collaboration and innovation.
Straight Line Acceleration
Most organizations are designed for straight-line acceleration. This is reflected in characteristics such as:
- Top down management
- Annual budgeting and planning cycles
- 3-5 year strategies set at the top
- Bureaucratic committees, processes, etc
Such traditional management meets the need for visibility, predictability, and control. It ensures the smooth and efficient running of the organization.
Who wouldn't want Straight Line Acceleration? Shareholders are certainly going to reward those who can grow in a straight line. In stable & predictable conditions, accelerating in a straight line is clearly the way to go. It is the management ideal. But, what happens when things are not moving in a straight line. What happens when there is a ‘bend in the road', so to speak?
Another word for straight line acceleration is ‘business as usual’ (BAU) – in other words the usual customers, competitors, channels, products and technologies1. The problem is that the structures, processes and ways of working suited to BAU don’t deal with the unusual very well. Adapting and adjusting to change – even seeing change coming – therefore represents a challenge.
When Straight-Line Acceleration Doesn't Work
If the road ahead appears to be a straight line then take care. You may be experiencing the twin dangers of hidden complexity and misplaced certainty. As a result your plans are likely based on some dangerous assumptions.
Most industries and markets are characterized by accelerating change, growing complexity and increased unpredictability. These are reflective of a non-linear world – a world where straight line acceleration is dangerous.
The path from strategy to execution is not a straight line. If it was, most strategic projects and initiatives would succeed, but of course they don't.
In a non-linear world leaders need to expect surprises. Their organizations need to be ready to adapt to changes in respect of markets, channels, customers and so on. They need to be able to spot the change early enough as to be able to maneuver, rather than crash out.
We are all familiar with the stories of industry giants who have fallen or at least fallen behind. Overtaken by upstarts and blindsided by change, they fell victim to their own success believing that it would continue forever. They operated on the assumption of Straight Line Acceleration.
Straight Line Acceleration (SLA) is an organizational state characterized by Hierarchy, Bureaucracy, Silos and Hubris. The latter is important, with organizations that have long enjoyed success being at risk of excessive pride or self-confidence. This is typically accompanied by complacency and an internal obsession. In this way it is not just a matter of strategy, but of organizational mindset and culture.
Seeing Around Corners
The challenges of competing in an increasingly complex and fast changing world are nicely summed up in one phrase: ‘seeing around corners'. That is the title of a best-selling strategy book by Rita Gunther McGrath2. It has natural appeal to our clients given that our models embrace the concepts of speed and agility from racing. It also amps up the notion of strategy not just as a journey, but as a race that has many twists and turns.
Seeing Around Corners is the opposite of Straight Line Acceleration. It is an approach to Strategic Leadership that embraces change and uncertainty in the drive to ensure the sustainability of performance into the future.
For organizations that have only known Straight Line Acceleration, seeing around corners isn't easy. Indeed, the larger and longer established the organization the more likely it is to struggle with seeing around corners. They risk being overtaken by competitors and blindsided by change. By the time they spot an opportunity or challenge, it may well be too late to respond.
Leaders are expected to demonstrate confidence in their vision or plan, if they are to inspire others and secure funding. But for a leader to believe that they can accurately forecast the future is, in the words of one of our consulting partners, “naive, even arrogant”. As he points out “many organizations set strategy as if they could ‘see around corners’. …they execute their strategic projects and initiatives as if there were no corners at all”.
Linear Thinking in a Non-Linear World
Straight Line Acceleration is not just about strategy or structure. It is also about mindset. Specifically, a Non-Linear World requires non-linear thinking. That is not the default, however. Indeed, it goes against our brain's drive for efficiency – which guides us towards what has worked in the past, what is familiar, what is the obvious answer, what others are thinking/doing and so on3 The result is a ‘double jeopardy' consisting of hidden complexity and misplaced certainty4.
MBA and other leader education has been very effective at producing linear thinkers. That is not surprising given that most of the dominant models of management and strategy have straight lines. Perhaps it is no surprise also that some of the most celebrated innovators – such as Steve Jobs to Mark Zuckerberg – were University drop-outs.
Non-linear thinking means entertaining more scenarios, questioning existing beliefs, challenging assumptions, revising our world view, big picture / systems thinking, experimenting with new approaches, slowing down before arriving at a decision, embracing uncertainty, engaging with diverse perspectives, and so on. A switch from linear as opposed to lateral or more creative thinking is important in fostering innovation and agility.
Many leaders tell us that their struggle is not with non-linear thinking, but rather with getting time to think full stop. Indeed, many leaders tell us that they get less than an hour of uninterrupted hours in a week. Given this real constraint it is not surprising that leaders struggle to see the big picture, entertain alternative scenarios regarding the future or to challenge assumptions.
Organizations in ‘Straight Line Acceleration' mode tend to be more myopic in other ways too. They can struggle to look beyond the short term or beyond what is going on in their organizations (to what is going on in the marketplace). The result is that they can be overtaken/blindsided by change. Staying close to the market – to what customers are saying and what competitors are doing is vital to spotting the bend in the road.
Seeing Around Corners – A Mindset
By ‘Seeing Around Corners’ we don’t just mean being able to predict what is coming around the bend. That is to be able to predict a shift in customer tastes, a new technology or even a new business model. We don’t just mean being able to see these trends before others spot them, either. These are important factors, but seeing around corners is an organizational mindset, stance or posture that enables an organization not just to adapt to change and uncertainty, but to profit from it.
Seeing Around Corners is a state of alertness, responsiveness and external focus. It is characterized by curiosity, a readiness to embrace change and uncertainty, as well as learning and experimentation. There is zero complacency, reflected in the restless pursuit of the winning edge, or a paranoia regarding the sustainability of success.
Measuring the ability to ‘See Around Corners'
They say ‘what gets measured gets managed'. So, why not measure the ability to ‘see around corners'? This is something our Pitstop Analytics platform does with a ‘Seeing Around Corners index' (SACi) – as shown below5.
The question is: How does your organization score on its ability to ‘See Around Corners'?
The above analysis is typical of many organizations – where corporate level SACI falls well below that of the business unit being measured. This is the classic Business As Usual vs Business Unusual dichotomy, with the business unit aiming to exploit emerging product-market opportunities within a long-established industry leader6.
‘Seeing Around Corners' – 4 Capabilities
‘Seeing Around Corners’ is linked to a set of 4 Organizational Capabilities: Speed, Agility, Collaboration and Innovation.
Measuring the 4 SACI variables provides an insight to the ability of an organization, business unit or team to ‘see around corners', as shown below.
Conveniently, the initials of this ‘Seeing Around Corners index' (SACi) are an acronym for the 4 factors measured -Speed, Agility, Collaboration & Innovation. They are part of a suite of analytics that illuminates the sustainability of performance in a time of change and uncertainty.
The important message communicated by this analysis is: ‘seeing around corners' is a capability that can be nurtured and developed.
Conclusions & Reflections
Take a moment to reflect of the above. Then consider the following questions:
- Where is your business unit or team on the scale from Straight Line Acceleration to Seeing Around Corners?
- Do you have the mindset for Seeing Around Corners – how well can you embrace curiosity, change and uncertainty, as well as learning and experimentation?
- What is the level of speed and agility today? What are the factors that are hindering greater speed and agility?
- What is the level of innovation and collaboration today? How can this be increased over time?
Here we build on the ideas in Rita Gunther McGrawth's 2019 book:
SOLUTIONS & SERVICES: Here are some of the ways that our research & insights are put to work by our clients:
- See: The ‘Business Unusual’ Test: Find Out How Strategic Your Project or Initiative Really Is on Growth Pitstop – https://growthpitstop.com/2020/05/21/how-strategic-is-your-project-the-business-unusual-test/
- Rita Gunther McGrath & Clayton Christensen, ‘Seeing Around Corners: How to Spot Inflection Points in Business Before They Happen’, Houghton Mifflin Harcourt, 2019.
- See ‘Linear Thinking in a Nonlinear World – The obvious choice is often wrong.' by Bart de Langhe, Stefano Puntoni and Richard Larrick, From the Magazine (May–June 2017). Link: https://hbr.org/2017/05/linear-thinking-in-a-nonlinear-world.
- See: Project Double Jeopardy: The Dangers of Hidden Complexity & Misplaced Certainty, Growth Pitstop, 2022, Link: https://growthpitstop.com/2021/07/29/project-double-jeopardy-the-dangers-of-unseen-complexity-misplaced-certainty/
- Pitstop AnalyticsTM provides a full systemic analysis of the performance and potential of strategies, initiatives and the teams running them, with SACI forming just one part of a comprehensive analysis.
- It is important to measure SACI at a number of levels, specifically at the organizational level as well as at the level of a business unit or team. That is because it is necessary to understand the broader system within which collaboration or innovation takes place.