A Lesson from Macmillan: Why We Need to Strategize Three Steps Ahead of the Game

Events, dear boy, events!” – Harold Macmillan (UK Prime Minister 1957-1963)

Whether Macmillan ever uttered these famous words in response to a question about what makes governments change actions is open to conjecture, but he gets credit for this well-known saying.

The message from Macmillan’s response is a warning that failure to build strategic contingency plans lets events dictate actions. The tools used by well-established governments, leading military minds, and elite sports organizations to address unanticipated events are suitable for business as well. A key part of the process is building a team whose responsibility is to monitor events and create preemptive understandings of adversaries and rivals’ intentions.

There are different industry specific terms to describe the teams, including agents, scouts, or listening posts. What they have in common is that they all act as a constant radar that spots issues and external threats. These issues can be missed by organizations where managers are more fixated on their internal strengths and weaknesses, as opposed to external events that change constantly and are outside of their control.

Leaders in governments and the military spend less time looking inwardly to identify significant new trends or external threats. These leaders seek out and use human intelligence to extrapolate what is going on in the minds of competitive leaders and adversaries. The intention is to become acutely sensitized to the market and anticipate changes. When done right, this helps the leaders predict what may happen from subtle signals and anomalies that are being actively tracked and monitored by trained minds.

Of course, seeing the signals themselves is not always sufficient. It is equally or perhaps even more important to interpret the signals correctly. As an example, this year, British Prime Minister Theresa May and her advisers failed to see changing signals in the electorate. Labor Opposition’s leader, Jeremy Corbyn, had quietly created a movement among younger voters, many of whom were able and motivated to vote for the first time. Theresa May’s team did not look in the right places and failed to see the size of the movement or properly interpret its intentions.

The May team relied on polling and sampling methodologies that had changed little since the last elections. These processes did not take into account a generation who watch less network TV and read less traditional media. The traditional conservative politicians missed this opposition groundswell. Pollsters themselves did not embrace the power of social media, which has grown in recent elections. There was a major flaw in the May team’s assumptions about the new generation’s attitudes, and substantial blind spots were discovered, but too late.

Many companies spend market and competitive intelligence resources in effort to enrich internal data. This leads to the question of how they transform information & knowledge into actionable intelligence. Without that transformation, they often fail to address the “So What” challenge. What is alarming is how few companies have a serious state-of-art strategic intelligence operation in place. This means that few global companies have made the transformation from data, information, and knowledge into a full-scale predictive intelligence capability.

Organizations with strategic intelligence driven programs can deliver real time insights & foresights on potential threats, changes, and new market dynamics their businesses could face in the future. At the same time, these companies invest in competitor simulations and scenario planning sessions, or practice emergency measures for disaster recovery. They prepare for a range of threats, such as cyber attacks, a completely new business paradigm, or a market entrant from an unexpected sector or geography. They develop and simulate counter-measures and practice counter-intelligence. Results include actionable intelligence, which top management can leverage into strategic implementation.

In the U.K., the Prime Minister and the British Government use the “Cabinet Office Briefing Room A” (COBRA) to coordinate responses in an emergency. The room is also used to plan for events that have not happened, and to prevent external threats that news agencies and the public never hear about. In the business world of intense global competition, surprises are also unwelcome.

World-class leaders and CEOs insist on receiving current briefings and analysis of intelligence, which is often divided into 2 x 2 matrix:Just as the UK government uses COBRA, CEOs need a company briefing and radar room to manage unusual events and plan for contingencies. The briefing room staff must provide the CEO with actionable intelligence unique to the situation. This is different from the usual intelligence role that too often mines public data with the latest analytical and internal statistical forecasting tools and data sets that many rivals have already. Leaders need to put in place the people and processes to create a top down culture that helps predict and overcome challenging situations.

The staff of these rooms need to be able to respond to one of the most fundamentally important questions in business today: “What would they do differently,” and avoid the rear view mirror question of “Why on earth did we not see this coming?” A reply of “Events, dear boy, events” is a sign that the leadership did not really anticipate or plan for events outside their control.

– Gordon Donkin, Head EU Office, Fletcher/CSI & Erik Glitman, CEO, Fletcher/CSI

To learn more about customized Strategy Workshops or competitive intelligence from Fletcher/CSI and how we can help your company build plans that accommodate changing market dynamics, please visit our website @ www.fletchercsi.com or contact us directly at [email protected] and [email protected]

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