The Association Renewal Blog

Faith, Risk and Answers

Thanks to Jeff, Ben Martin, and Scott Briscoe for an interesting blogoclump exchange about an article in Associations Now that talked about risk, faith, and innovation. There was some debate about the role of faith and risk. Here are some points they made:

Scott:
I would argue that short of clairvoyance, every decision is a leap of faith.

Ben:
However, each innovative program that gets introduced must carry a measure of faith. Because humans are terrible about choosing which ideas will fly and which will fail.

Article:
Building an organization that thrives on calculated risks requires a variety of ingredients. Among them are a seasoned and courageous CEO, thorough research and planning of "risky" endeavors, the ability to predict change, a board and staff team that is encouraged to embrace and cultivate innovation, and, perhaps most importantly, a plan for getting from Point A to Point B.

So let me get this straight. We’re trying to build successful organizations, and sometimes organizations need to change course. But we’ve discovered that changing course or moving in a new direction carries with it some risks. So we need to do research and develop plans and actually predict change, so that our risks are less…risky. But in the end, there will still be SOME risk, so we will need faith.

My reaction to all this is: so what?

Why are we talking about the fact that none of us knows what will happen in the future? That’s a given. Why are we looking at risk as if it were optional? Risk is there when we change, and risk is there when we don’t change. What are we really talking about here?

The article seems to be saying that if you have courage, do research, are good at predictions, and have a plan, then you’ll be more able to take risks that work out, like the nice stories in the article where associations tried new programs and they turned out well.

I’m not convinced.

You can have all of those things (research, plans, etc.) and still make a bad decision and start a really horrible new program. On big decisions, there is no way to guarantee you have the right answer. In fact, I think it is our obsession with answers that is part of the problem.

Answers are retrospective. When we look to the past, we can piece together a story of cause and effect that results in the right “answer.” So we try to apply that to the future and choose that one future path with the least risks. But that’s ridiculous, because the past is done and the future is evolving. Yes you should expand your knowledge (research and thinking about both the past and the future is good), but it’s less about answers and more about learning.

Jeff and I talk about building capacity for thinking and conversations, because that’s where the learning is—not in crafting detailed answers. You certainly need to decide on things and do them, but let’s not worry about whether risk is present (it is), and let’s not obsess about predicting the right answer—instead let’s talk about the best ways to build our capacity for learning and growth.

Reckoning the Future

More from Roger Martin on Design in Fast Company. He said the way successful businesses “reckon the future” distinguishes themselves in the way they think. Amen.

Specifically, he notes that most “business as usual” shops focus on inductive and deductive logic. With inductive, you observe what happens and decide what to do. With deductive, you come up with a principle that guides what you do. Both are fine.

“Business as design” shops add “abductive” reasoning: the logic of what might be.

From the article:

A.G. Lafley, the chief executive of Procter & Gamble, understands the need to braid all three forms of creative thinking. While he is a true data hound, Lafley also pores over anecdotal research and allows customer comments to influence him even if they are not rigorously collected or statistically significant. Lafley was relying on that kind of anecdotal evidence when he championed the conversion from big box to compact detergents—one of P&G’s most important decisions over the past 15 years, and one that flew in the face of the available hard data. That decision opened a multibillion-dollar market for P&G and demonstrated that simply regressing the past isn’t enough to bust a daunting challenge.

I think this ties right in with some recent blogoclump postings (here and here) about research and also about intuition. Personally, I don’t think the research “guides” the intuition. I think intuition is a source of data in itself and both impact decision making (or should).

Beyond Consultant-Speak: Words with Power

I came across the following two sentences in an association strategic plan (not one that I was involved in, mind you):

The Board will adopt systems to manage initiatives and maintain dynamic communications with all stakeholders. Simultaneously, we will implement devices for strategy learning, including benchmarking, best-practice sharing, internal coaching, and change management.

I’m not sure which is more depressing: (1) the fact that these sentences are typical in strategic plans; or (2) the fact that I think I know what they mean.

There is good intention behind these words; I’m sure of that. My guess is that this Board wants to communicate with the people who matter. They want to learn from what they are doing. They want to stay vibrant, alive, and connected as they try to lead the association. But we need to come up with simpler, clearer language to get at the truth. Would you read that passage above and be inspired into any sort of action? Would this make anything clearer for you? We need words that generate action and/or clarity. We need to stop settling for words that sound good by industry standards and have the discipline to demand words with real power.

Research is a Measure of Success...Maybe

Another article in Fast Company's "Design" issue is about the CEO of Puma, the sneaker company that has moved from performance shoes to fashion apparel with great success. The CEO challenges the notion that research is necessarily the ticket to "greatness":

But if you want to change the industry and do something completely new and innovate, research is a bad tool because all you will get fed back is perception today and not tomorrow.

To be clear: research is not evil, but it has limitations.

More on Design

Here are some more thoughts about the “design” article (subscription required) from Fast Company that I mentioned earlier.

Roger Martin points out that “design” has become cool now (as evidenced by his article in Fast Company, frankly). But it’s more than that. It’s not just actual design of cool things. It’s design as a philosophy, or way of doing business. He puts “business as design” in contrast with “business as usual.” The two ways of doing business want very different things, which he frames in terms of “reliable” versus “valid.”

Business as usual wants reliable: quantifiable, measurable, and provable. Business as design wants valid: deep understanding of user and context leading to ideas you believe in but can’t prove. Less about replicating a successful process than about producing a spectacular solution.

Associations tend to focus on reliable and are somewhat skeptical about valid. Although there is nothing inherently wrong with reliable. Reliable can generate growth. Reliable brings you McDonalds, Wal-Mart, Dell. That’s billions of dollars of wealth created, he points out.

But valid generates growth too. Valid brings you design leaders like Panasonic, Timberland, and Bombardier that have grown exponentially, yet each “continues to put a premium on judgment, experience, and gut instinct.”

Success requires a both-and approach. As Martin says:

The challenge is to manage the chronic push and pull between a value system premised on what’s valid and one based on what’s reliable. As the management theorist James March has argued, by focusing on the intuitive and experiential, organizations explore new sources of competitive advantage. By looking to the provable and replicable, organizations better exploit the innovations they’ve brought to market. To prosper of the long run, a company needs to succeed at both. It must mesh the classical workings of a traditional organization with the prototypical features of a design shop, especially in three key areas: reckoning the future, organizing the work, and establishing status and rewards.

More later.

Strategy is a commodity

In my last post here, I wrote, "strategy itself is in danger of being commoditized and strategic planning is already there."  Let me take that thought one step further:  the association community's overall thinking about and approach to strategy has been commoditized by an excessive reliance on traditional strategic planning.  Let me explain.

One definition of a commodity is "a mass-produced unspecialized product," and that is precisely the way that strategic planning is packaged and practiced in the association community today.  Many consultants offer strategic planning services and many associations avail themselves of those services.  But there is precious little distinction in the approaches that most associations and their advisors bring to the work of strategic planning, creating the deep-seated yet wholly inaccurate belief among many association leaders that there is only one way to pursue the work of strategy.  A complicating factor that reinforces this narrow perspective is the past strategic planning experiences brought to the table by volunteers.  Although there may be slight variations across the whole volunteer group, most board members and other senior volunteers are invested in the same basic set of activities as their associations' staff leaders.

There are myriad problems with adopting this kind of undifferentiated approach to strategy, and the most significant among them is the extraordinary difficulty it creates for associations that are trying to be different and innovate in an increasingly competitive, complex and uncertain environment.  But this emphasis on sameness in the work of association strategy should not come as a complete surprise since associations themselves are all about a focus on what makes individuals and organizations the same.  Unfortunately, the work of strategy does not benefit from this kind of convergent mindset. 

If associations are going to make real breakthroughs in creating new value for their members in the years ahead, they will need to abandon any assumption that the discipline of strategy is something that can be ordered up and delivered in a box in a matter of a few months at a discount.  Going forward, I believe three critical factors are going to be the driver of genuine strategic success for all associations:  creativity, simplicity and execution.  I will expand on these ideas in my next post.

The Long Tail Live!

Jeff and I went to hear Chris Anderson speak in NYC on Thursday. It was a brief presentation, much of which covered the basics of the Long Tail, although I must say, I am still amazed at some of the statistics. The top TV show recently (CSI) wouldn't have even been in the top 10 just a few years ago, based on percentage of households watching.

Main points I took home: I used to think that the music I heard on the radio and the movies I saw in the theaters were simply the good ones. Those that were not good, didn't make the cut. In fact, the ones I saw were merely the ones the distribution channels had room for. There were (and, more importantly, ARE) plenty more good ones out there. The internet opens the distribution channels, and suddenly we have access to much more "good" stuff than we thought was out there.

I think that's particularly important for associations. This community has become quite convinced that the way to find content is by going to conferences, reading the magazines, and otherwise taking in what a few people have deemed to be the "best" material (that they can fit into their channel). It's time to blow that myth apart.

Another important point: the economy that drives producers of "hits" is much different than the economy that drives the producers of the long tail. We need to understand that if we are to take advantage of it.