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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
Understand what's required to deliver top-of-the-line customer experiences As organizations around the world do their best to deliver meaningful, effective, and efficient customer experiences, many are encountering difficulty translating their actions into progress. These businesses find that, despite a plethora of initiatives, programs, and plans, inclusive and excellent customer service remains stubbornly out of reach. In Shift: Transform Motion into Progress in Business, Chief Strategy and Marketing Officers at Merkle and dentsu offer business leaders a practical and coherent approach to creating the consistently exceptional customer experience that would set their business apart from the competition. The authors link three key themes--a clear vision with clear performance indicators, an aligned team, and a deep understanding of the marketplace--and outline their importance in the quest for the ideal client experience. They explain the importance of measuring progress through the eyes of the customer and ensuring that the measures that matter to customers are improving. A necessary addition to the reading lists of innovation and business development professionals, Shift deserves a place on the bookshelves of managers, executives, and other business leaders attempting to set their organization apart from the competition.
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Veröffentlichungsjahr: 2022
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Table of Contents
COVER
TITLE PAGE
COPYRIGHT
FOREWORD
ACKNOWLEDGMENTS
Our adaptive leaders
Our adaptive families
Our adaptive readers
INTRODUCTION: ROCKING HORSES DON'T BELONG IN BOARDROOMS
Charting progress in a modern business world
The race to the top
There are no silver bullets
Uncovering your starting point
Working towards meaningful transformation
Part One: Principal
Chapter 1: The Peppered Moth
The
Bandersnatch
process
Emotional intelligence is more than a process
Principles guide the business
The aim is an adaptive organisation that can transform motion into progress
Progress accelerator
Highlights
Note
Chapter 2: The Chicken KPI
The Healing Pyramid
First things first
Focus on the outcome
Not everything that matters can be measured
Connecting the dots
Measurement as a catalyst for change
Does it make the “car” go faster?
Always ask “Why?”
Customer experience vs revenue
The KPI Tree
Progress accelerator
Highlights
Notes
Chapter 3: The Queen's Gambit
If you're going to do something, do the
right
thing
Focusing on outcomes over outputs
Yesterday's tactics aren't tomorrow's strategy
Not everything is in your control
Immersive versus invisible experiences
“The answer is 42”
Finding clarity through classification
How do classification systems aid decision making?
The Moment Builder
Every sale matters
From automation to augmented intelligence
It's never just one dimension
The Fluid Cube
Highlights
Part Two: The Crew
Chapter 4: Make Every Shot Count
The battlefield of modern business
#1 Think big, start small, scale fast
#2 Don't let perfect be the enemy of good
#3 Make sure you're planting trees
#4 Measure marginal gains
and
losses, or you'll be in hot water
#5 Know what good looks like for you
#6 Make sure you don't just tick the boxes
#7 Make headless design a mindset
#8 Beware of initiative fatigue
#9 Let success breed success
The outcome model
Progress accelerator
Highlights
Notes
Chapter 5: Row the Boat in Time
Culture starts from the top…but lives in the foundations
Align the crew behind your purpose
Freedom in a box
Is your organisation a spider or a starfish?
The value of autonomy
Who's on the bus and where are these people sitting?
Making the most of what you have
Raising and training unicorns
Efficiency: The final piece of the puzzle
Why aren't we moving faster?
Highlights
Notes
Part Three: The Season
Chapter 6: Turn Headwinds into Tailwinds
How high are your walls?
Flicking the switch
Lowering the walls
Finding the balance
The blinking business
Creating an environment where your business can flourish
Finding your starting point
People make the business
Highlights
Note
Chapter 7: It Will Rain on Your Parade
Flexible strategies are a necessity
Not all businesses are created equal
A constant process of evolution
Don't turn the elephant into a rhino
Slipstreaming and overtaking
Creating opportunities in a crisis
Change beyond a crisis
You can't fight modernisation
Economic upheaval: adapt or die
Turning motion into progress
Where do you start?
Escaping the headlights
You don't always need a saviour
What's happening in the consumers' world?
You can't control your customers
Expectations versus reality
Meeting customer needs is your best competitive advantage
Fear versus determination
The game is never over
What about the environment?
Highlights
Notes
Chapter 8: Go for the Albatross
Knowing when to take the risk
Playing for the win, rather than the draw
What's the worst outcome you'll get?
Do you have to go early to land an albatross?
When to go for the albatross
Go for 10× not 10%
Wins aren't always short term
You can't cut corners when you're building foundations
Keep things simple
What does your customer need?
Sometimes you have to strip back to go forwards
Trust yourself, but apply the logic test
Go back to first principles
Highlights
Notes
CONCLUSION
Shift gears to accelerate your progress
Progress accelerator
EPILOGUE
What our adaptive leaders have to say
Put the customer first
Have an aligned purpose with strong values
Balance the C-suite perspective
Pivot from measuring what you can, to measuring what you should
ABOUT THE AUTHORS
INDEX
END USER LICENSE AGREEMENT
List of Illustrations
Introduction
Figure i.1
Figure i.2
Figure i.3
Figure i.4
Figure i.5
Chapter 2
Figure 2.1
Chapter 3
Figure 3.1
Figure 3.2
Figure 3.3
Figure 3.4
Chapter 4
Figure 4.1
Chapter 5
Figure 5.1
Chapter 6
Figure 6.1
Figure 6.2
Chapter 7
Figure 7.1
Chapter 8
Figure 8.1
Figure 8.2
Guide
Cover Page
Table of Contents
Title Page
Copyright
Foreword
Acknowledgments
Introduction: Rocking Horses Don't Belong in Boardrooms
Begin Reading
Conclusion
Epilogue
About the Authors
Index
End User License Agreement
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Shift
Transform Motion into Progress in Business
Richard Lees
Azlan Raj
This edition first published 2022
© 2022 by Richard Lees and Azlan Raj
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Library of Congress Cataloging-in-Publication Data
Names: Lees, Richard (Chief strategy officer), author. | Raj, Azlan (Chief marketing officer), author.
Title: Shift : Transform motion into progress in business / Richard Lees and Azlan Raj.
Description: West Sussex, United Kingdom : Wiley, 2022. | Includes index.
Identifiers: LCCN 2021042852 (print) | LCCN 2021042853 (ebook) | ISBN 9781119810148 (cloth) | ISBN 9781119810506 (adobe pdf) | ISBN 9781119810490 (epub)
Subjects: LCSH: Customer relations. | Consumer behavior. | Consumer satisfaction. | Success in business.
Classification: LCC HF5415.5 .L438 2022 (print) | LCC HF5415.5 (ebook) | DDC 658.8/12—dc23
LC record available at https://lccn.loc.gov/2021042852
LC ebook record available at https://lccn.loc.gov/2021042853
Cover Design: Wiley
FOREWORD
At dentsu, we are striving to be champions for meaningful progress. This is one of the core principles that underscores our vision, but what does it truly mean? For us, meaningful refers to activities that add value to people's lives, while progress is the positive manifestation of motion with the focus placed firmly on our desired outcomes.
Meaningful progress is a force for growth and good. It is a force that can unlock unique possibilities to drive sustainable value and lead to lasting change. It is the gateway to the future for brands in all industries.
I first met Rich and Az after joining dentsu in 2020, and when they shared the concept of this book, I could immediately see how our ambition of championing meaningful progress was woven throughout its chapters. More than this, it maps out the connections that businesses of all sizes must consider if they, too, are to achieve meaningful progress.
In the highly competitive and fast-changing world that we find ourselves in, keeping up is hard enough and staying ahead can be a constant challenge. The currency of business nowadays is speed. Doing “something” is simply not good enough. There are numerous fronts that must be navigated simultaneously, and prioritising the important over the nice-to-have can be hard to do.
This struggle is one that Rich and Az understand well. The ideas they share in this book are simple to draw out. They are easy to explain, and certainly important to connect. However, they are difficult to do, which is why so many businesses get stuck in a trap of constant motion, whereby a lot of tasks are done that keep everyone very busy and deplete budgets, but you lose sight of meaningful progress.
When this happens, it becomes increasingly difficult to translate this movement into clear and measurable business or customer value. This is when the focus often shifts to processes and projects, moving away from customer needs and the value that is derived from meeting them.
Az and Rich use a simple Formula 1 analogy to link the three core themes that a business must connect to create one seamless ecosystem for success. Drawing on their collective 50 years in the realm of customer experience, they use clear examples of the challenges that businesses face in order to highlight not only the importance of each core theme, but more importantly, the need to weave them across every element of the business landscape to deliver true value.
The first of these core themes is a clear vision that sets the direction and common purpose for your organisation, and the need for clear measures to ensure you remain on track. The second is the team and the need for alignment of purpose across an entire organisation. They also delve into radical collaboration, another of our passions at dentsu, as well as the need for autonomy. The final theme relates to reading the market and understanding the external factors that affect every business's ability to compete effectively.
The threads that connect these themes and their many integrated topics are the simple concepts of starting with the end in mind, recognising that motion does not necessarily equate to progress, and actively seeking out and measuring that progress.
If you can't turn motion into progress, what you are left with is a lot of very expensive movement. If you proxy motion for progress, as many businesses do, you will become stuck. As you read, you may realise that your business falls into this category. If that's the case, you'll find tools in these chapters to help you turn motion into meaningful progress. I urge you to use them.
Since starting my role with dentsu, I have spoken to hundreds of clients and all of them mention the same challenges; chief among them are transformation and finding a way to measure the efficiency of their activities. In my career I have been both client and agency side; I have worked with some of the world's biggest brands and I have witnessed how these challenges manifest themselves in different organisational environments. I also understand the crucial role that strong leadership plays in navigating these challenges.
I believe a leader's role is to provide a careful balance between hope and reality. Great leaders paint a vivid picture of what they want to do and where they want to go. They align people and resources around their vision of the future, but they do so without neglecting the reality of where they are now. They are transparent, honest, and realistic about what the journey from their current reality to their visionary future entails. This is the foundation for achieving meaningful progress, and it is these ideas that you will find woven throughout this book in an interesting and thought-provoking way.
The compelling anecdotes and connected themes that are covered in this book are as applicable for marketing leaders as for CEOs. Dive in, learn what you can from the years of experience Rich and Az bring to this space, and have the courage to invent the future that you're taking your company into. In doing so, you too will become champions for meaningful progress.
Wendy Clark
CEO, dentsu international, and former President,
Sparkling Brands & Strategic Marketing,
Coca-Cola North America
ACKNOWLEDGMENTS
In our roles, we have been privileged to work with some of the most respected business leaders in the world. These leaders have been kind enough to share their insights with us, and you will see some of their thoughts throughout the book.
Our adaptive leaders
Whilst we had some contributors share their thoughts anonymously, we wanted to thank them and all the individuals below who have shared their thoughts in this book:
Paloma Azulay, Global Chief Brand Officer, Restaurant Brands International
Aaron Bradley, VP of Technology & Innovation, Wella Company
Benjamin Braun, CMO, Samsung
Wendy Clark, Global CEO, dentsu international
Nicholas Cumisky, YouTube
Craig Dempster, Global CEO, Merkle
Doug Jensen, SVP – GTM & COE for Analytics & Activation, Estée Lauder
Nicola Mendelsohn, CBE, VP GBG, Meta
Nick Ratcliffe, Customer Experience Director, Volkswagen Group Ltd
Paul Robson, President of Adobe International, Adobe Craig Smith, Chief Brand Officer & Co-Founder, Decidable Global Ltd, and Former Digital Commerce Director, Ted Baker
Marisa Thalberg, EVP, Chief Brand and Marketing Officer, Lowe's
Deborah Wahl, Global CMO, General Motors
Margaret Wagner, EMEA President, Merkle
Jennifer Warren, VP Global Brand Marketing, Indeed
Shelley Zalis, CEO, The Female Quotient
Our adaptive families
We would like to thank our families for the support they've given us. They've been there through the late nights and the long weekends, being both our samples of one and to ground us when needed. Our wives have kept us going and our children have done their best to keep the noise down whilst we've been working! We definitely wouldn't have made it through this journey without them.
Our adaptive readers
We would also like to thank you, the reader. Our aim was to provide something that was useful to you with a flavour of fun and a sprinkle of our personalities. We hope that the blood, sweat, and tears that we've put into this book (please don't let that sway your opinion) is as enjoyable for you to read as it was for us to write.
INTRODUCTION: ROCKING HORSES DON'T BELONG IN BOARDROOMS
“Don't confuse motion for progress. A rocking horse moves all day but goes nowhere”!
– Alfred Montapert
Picture a child sitting on a rocking horse. She is laughing as she sways back and forth. Maybe she is pushing the rocking horse to go faster, encouraging it by shouting phrases like, “Giddy up!” As you watch the child enjoying her ride on the rocking horse, you smile. She is safe; she is happy, and you know that regardless of what her imagination is telling her, she is going nowhere (in the physical sense). You leave her to her game, confident that you won't look out of the window to see her galloping across the garden on her rocking horse in half an hour.
You would certainly think it odd if you walked into a boardroom to see the CEO, CMO, CTO, or any of the other directors sitting on a rocking horse. However, all too often, businesses have boardrooms filled with metaphorical rocking horses; they just don't realise it. They don't always distinguish between motion and progress, or know how to turn the motion they are generating into progress.
Charting progress in a modern business world
The business world today, especially after black swan events like the 2008 financial crisis or the global COVID-19 pandemic, is characterised by an increasingly big number of known unknowns. It seems clear that the past is probably no longer a safe basis for predicting the future, and much of what we have learned and been taught may well have limited relevance to our future decision making.
The competition feels like it can come from anywhere, and time is definitely no longer on your side. As Rupert Murdoch said (in 1999!), “The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow”.
To not only survive, but to thrive in the new world is a constant challenge that requires businesses to fast become the masters of many things. Agility (speed) and adaptability (ability to change) have become strategic differentiators, giving those businesses that can rapidly adapt and build a muscle to respond to change a massive advantage.
“The speed and availability of data, technology, analytics, content, and platforms is creating this perfect storm where we can finally capitalise on the opportunity presented by the total customer experience in a way that we just couldn't before. If brands are not on that journey to that complete and total customer experience across those dimensions of sales, service, commerce and marketing, they just won't be around in the future.”
Craig Dempster, Global CEO, Merkle
Some businesses have the advantage of already being in this state (let's call them the leaders). Others are undergoing massive transformations to close the gap and either attain or regain this state (let call them the followers, who are playing catchup). However, to do this requires sustained and directed momentum, or motion, but motion alone will not give you the advantage. The advantage comes from turning motion into progress.
This might sound simple enough, but often this is more difficult to achieve than it first appears. The result in many businesses is a great deal of motion that adds little real value and instead wastes precious time and resources, and may even contribute to a loss of competitive advantage. The opportunity, as we explain in this book, is to turn that motion into progress. To do that, you need to connect the three core themes of the business ecosystem, which we are calling the principal, the crew, and the season.
The race to the top
Our favourite analogy to describe what a business needs to do in order to turn motion into progress is Formula 1. Behind the fast cars, daring driving, and excitement of race days there are three key components at work: the principal, the crew, and the season.
The principal of each team sets the direction and leads from the front. The crew needs to collaborate and work together to constantly improve the car, its engine performance, drive the car, and find ways to shave even 0.1 of a second off the lap time or length of a pit stop because that 0.1 second can mean the team's driver wins the race. Then there is the Formula 1 season, which lasts for much longer than a single race. Every race throughout the season is different. The car itself will perform differently depending on both the track and the weather conditions on the day, and the crew will need to adapt according to the conditions.
Figure i.1
When we apply those three principles to a business, we can see a clear correlation to core enterprise functions and challenges. The principal represents the leaders within the business, the people who make those big decisions, keep one eye on the big picture, and make sure that the company is moving in the right direction. The crew is the broader teams, the people on the ground who make things happen. When they are all aligned behind an organisation's vision, great things happen and progress begins to accelerate.
The season is the external environment that will have an impact on not only how the business performs, but also on how the team functions and performs in different situations. The season is the one element of the pyramid that the business doesn't have total control over. What any organisation can control, however, is how it responds to its environment. This becomes a game of agility, where the businesses that learn fast and adapt quickly survive, and those that don't, die.
You need to have all three components of the pyramid in place and working together in order to achieve progress. Without all of these components, your business will struggle to successfully turn motion into progress.
If you just have the principal with the season, but the crew is not aligned and engaged, you create fatigue. You will only have a short amount of time to build momentum and achieve your goals before you run out of energy.
Figure i.2
If you have the principal setting a clear direction of travel and the crew aligned behind them, but no awareness of the season and external environment, this leads to obsolescence. You won't be creating and delivering the products or services the market, and your customers, need.
Figure i.3
Finally, if the crew is responding to the season and working within the external environment, but is doing so without any leadership or direction from the principal, what you are left with is chaos. There won't be any coherence in your activities and progress will stall.
Figure i.4
What many organisations are aiming for is what we discussed at the beginning: the principal setting a clear direction and communicating the big-picture vision; the crew aligning with this vision, buying into it and being given autonomy to work toward that goal; and the organisation as a whole being aware of and having the ability to adapt to an ever-changing environment. The ideal state is to find a balance among all three themes.
Figure i.5
“The economy has fundamentally changed. We've moved from a world with digital to a digital-first world; and there's no going back. Digital has become the way for people to connect, work, learn, and be entertained and the imperative for digital customer engagement has never been greater. Every business must understand their customers to deliver personalized digital experiences.
“The brands that win this race will have hands-on leaders who are open to change, a culture built around trust, rapid decision making and action, as well as a dedication to innovation and learning. Most of the evolution we have seen through COVID-19 has centred on transactional needs, be it the global pivot to online shopping or the rise of digital finance. However, brands must also consider how these unprecedented times affect people at the cultural and emotional level.”
Paul Robson, President of Adobe International, Adobe
There are no silver bullets
If you have picked up this book hoping to find a silver bullet that will solve your business' problems, we're afraid we are going to disappoint you. Harmonising these three themes takes time, effort, and a great deal of motion. What we are sharing in these chapters, however, is aimed at helping you uncover how to translate your motion into progress and become a more adaptive organisation in the process.
Each part of this book covers topics related to that component of the business ecosystem. We begin in Part One with leadership, which comes from the principal. Without a clear direction of travel, you may meander aimlessly or go in circles, so setting that North Star is an important starting point. You also need to know how to measure your progress. Without clear measurement of the right metrics, you can't see how far (or not) you've gone and are therefore in danger of slipping back into a cycle of motion.
In Part Two, we move to your team and organisational ecosystem, including its culture. This component involves not only aligning your crew behind your vision, but also how you can support your team members to contribute to that progress, deliver on your goals, and do so in a way that draws on their strengths. Autonomy is one of the key concepts here, but this has to come with clear guidelines and a definitive North Star.
Finally, we explore the enterprise environment in Part Three, which is represented by the season. These are the events that you have to manage and adapt to as a business, but they are ones that are outside of your control. For example, the economy, political upheaval, global pandemics, and even the weather impact organisations of all sizes and in all sectors. This is not only about navigating challenges, but also about spotting opportunities and knowing when and how to take the shot that can significantly accelerate your progress.
Uncovering your starting point
You and your organisation are on your own personal journeys, with your own starting point. At the end of several of the chapters, we have provided a link to a series of online exercises that will help you to understand what stage you are at, what direction you may need to move in, what changes you may need to implement, and where you can find support.
Use these resources to help you apply the lessons from this book in your own business. Our aim is to help you understand how you can turn motion into progress, and to clear any rocking horses out of your boardroom.
Working towards meaningful transformation
We live in a world where competition really can come from anywhere, and businesses have to be able to rapidly respond to threats and adapt to change. Organisations must evolve multiple strategies and use these abilities to build and maintain persistent relationships with their customers. So, business transformation tends to be at the top of most large corporate agendas, to modernise businesses that have fallen behind in some way and need to rapidly play catchup.
In many cases, there is also a customer experience transformation (CXT) happening to meet the fast-shifting needs of customers, who today are empowered and in control. CXT is the combination of data transformation and digital transformation, which relates to a business' ability to respond in today's expectation economy. This is a world where customers are increasingly digitally savvy. They have choice. They are informed. They can and do vote with their feet (increasingly with their smartphones!). They expect service. They want quality. They are vocal when they don't get it.
If you are one of the many businesses that is transforming across multiple areas to make up lost ground, then this idea of building a business that can turn motion into meaningful progress will be very topical for you.
In our current work for Merkle and dentsu's Customer Experience Management service line, Rich as Chief Strategy Officer, EMEA, and Az as Chief Marketing Officer, EMEA, this is a topic we've tackled time and again with our clients. Over many years, we have seen and been part of extraordinary transformational efforts as well as attempts to transform businesses that did not gain sufficient traction.
What we are sharing in this book is a set of themes that any organisation can follow on its journey to becoming an adaptive organisation. Turning motion into progress is a key part of that journey. After all, how else are you going to get off the starting grid? However, as we're sure you know, making progress requires far more than simply turning on the engine and putting your foot to the floor.
The principles we share in each chapter are based on our experiences where we pull together examples and analogies to illustrate what we have found to be most important to a business' ability to become an adaptive organisation, and will hopefully provide you the guidance you need to harness that adaptive behaviour and turn it into meaningful progress. It is highly likely you already embrace at least some of them. However, if you are reading this book, there are also likely some obstacles in your path, some of which you may not even be aware of. Our hope is that you will find some ideas that can help you navigate those obstacles and continue your journey toward adaptiveness in the most efficient way possible.
If we help you overcome even one obstacle on your journey, we have achieved our goal. If you're ready, let's join the principal; it's race day.
Part OnePrincipal
Day is breaking over Silverstone race track on this July morning. It's the day of the British Grand Prix. The sun is shining and there are no clouds in sight, just as forecast. There is already a shimmer of a heat wave over the parts of the track that are being warmed by the sun's rays.
As the principal arrives at the track, they smile. They can go with their Plan A now that the conditions look fair.
Ahead of the race, the principal gathers their crew around them and gives them a final brief for the race. They explain the strategy, share any further information that they have gleaned from the reams of data generated during qualifying, and make sure everyone in their crew knows exactly what to do and when.
The principal talks with the lead race engineer and the driver separately. They are clear, concise, and focused. The goal is that chequered flag coming down on their driver. Everything they have done so far this weekend, and in the months leading up to this race, has been with this goal in mind. Throughout the season their strategy has evolved, taking each race as it comes, but there is always clarity over what the team is aiming for.
As the driver returns, suited up and ready to climb into their car, the principal takes a moment to soak up the scene. Everyone is in their place; everything is ready. The engine roars into life, the vibrations ripple through the air, and the smell of engine oil and fuel hangs heavy around the pit lane. The drivers start their slow procession to take up their positions on the grid, and the principal watches their car as it snakes along the track, warming up the tyres. A final glance around and a quick nod to the lead engineer shows the principal all they need to know: they're ready.
Every Formula 1 race team has a principal. This is the person who is responsible for communicating the team's vision and goals to the rest of the crew and leading for their constructor over the course of the race weekend, and indeed over the course of the entire Formula 1 season.
Principals set the direction for their respective team and clearly articulate the team's purpose, not only for each race, but across the season and indeed future seasons. They make sure that changes are made to the car to give the team the best chance of succeeding on race day. They oversee everything from the qualifiers that determine their starting position on the grid to the race itself. They set the strategy and make sure that this is communicated and executed by their crew, taking into account the external factors such as the track and conditions on race day. When there is an issue that affects operations, it is the principal who empowers the team, which will work to find the solution and chart a course out of any difficulties.
Being the team principal in Formula 1 is also an outward-facing role. Team principals will field many of the media's questions; they will take the criticism when the team doesn't perform as hoped; and they will also take the praise, although the best team principals make sure this is equally shared with the rest of the crew.
In addition to leading the way on race day, the principal is also the person who liaises with sponsors, hospitality, marketing, and many more. The principal joins all the dots to makes sure that the race crew can do its job to the best of its ability and present the team in the most positive light to the rest of the world.
There are clear parallels between being a principal and being a leader in any business. Within business, the principal is not just one person; a business can have multiple leaders at different levels in an organisation. In our context, the principal is any leader who defines direction or strategy. In the coming chapters, we're going to explore three key concepts that allow the leaders in any organisation to set the direction that the business will move in.
In Chapter 1, we look at the importance of selling the dream and vision, of clearly defining the purpose, and the importance of embedding that into a business' DNA from the start. Chapter 2 is all about measurement because creating the right measures is essential for driving the right behaviours and communicating the purpose that you're trying to achieve. You get what you measure, so you have to make sure that you're putting your focus in the right place. The final chapter in Part One is about prioritising your actions and making sure that you do the important things first. Don't try to boil the ocean.
All of these elements are a leader's responsibility, but we also want to be clear that when we talk about a leader, this doesn't have to just mean the leader of a company. It can be anyone who leads teams, leads on strategies, or provides thought leadership. Understanding the concepts we're exploring in Part One is important for leaders on every level within an organisation.
Leaders set the targets, but many businesses shoot for short-term targets because it is generally what shareholders want to see; however, this needs to be balanced with strategic focus on the bigger picture for longevity. This is all part of your culture; if you set short-term targets, people will have a short-term mindset. If you are only looking one step ahead of you as you walk, it's highly likely that you will walk towards a wall.
Focusing on the long-term goal, without breaking the journey into clear milestones to get there, is also far from ideal. If you are only focusing on the horizon, it's highly likely that you will fall down a hole. The key here is balance. Short-term targets are important to gain momentum and start to see progress. However, as we discuss in Chapter 1, you need to be able to keep one eye on this bigger picture to ensure your business and its programmes continuously evolve and adapt.
Chapter 1The Peppered Moth: Why adaptation and evolution are essential in twenty-first-century business
“Being a fish out of water is tough, but that's how you evolve.”
– Kumail Nanjiani
We'd like to begin by transporting you back to nineteenth-century England. The Industrial Revolution is taking hold, and the factories in the country's industrial heartlands are burning coal and pumping out black smoke. The residue from this smoke coats everything from buildings to trees.
Enter the peppered moth. In the 1800s, naturalists observed that peppered moths had evolved to fit in with this changed environment. The peppered moth is often found on the trunk of the silver birch tree and, therefore, its natural colouration is pale with darker spots, to match the colour of the tree's bark and camouflage it from predators. In highly industrialised areas of England, however, these moths were becoming darker in colour.
The pale-coloured moths stood out too much on the now-blackened bark of the trees and were therefore much easier for predators to spot. As a result, the pale moths were being eaten leaving the darker-coloured moths to survive and breed. Meanwhile, in regions where there was considerably less industrialisation the peppered moths remained pale in colour. They had no need to change their camouflage because their trees were not being darkened by soot.
This is probably one of the best documented stories of “adapt or die.” Peppered moths in industrialised areas adapted and evolved because those that didn't died. It really was that simple. To this day, it's still widely considered to be one of the best examples of Darwinian evolutionary theory.
What does your business have in common with the humble peppered moth? It too has to adapt or it will die. In the business world, just as in nature, our environment is continuously changing and that means we can never stop adapting to match it. There are many organisations in the world today that are undergoing a period of transformation because they have fallen behind and they need to catch up. What we're talking about here is not only transforming to catch up, but making adaptation and evolution a core part of your business so that you never fall behind again (or ideally that you never fall behind in the first place).
As a leader, it is your responsibility to determine the vision, paint that picture, and state your organisation's purpose so that you never fall behind again. Think about the Formula 1 race team principal who is continuously evolving the team's strategy and car to make sure that the team stays ahead of the pack. The principal's driver knows exactly what has to be done on the track, the crew knows exactly what's expected of it before, during, and after the race. This clear direction is what allows all on that team to function to their best ability.
However, a Formula 1 season is never just one race. Depending on performance throughout the season, not only will there be pivots and changes to the strategy set by the principal, but the end destination might also change. A string of poor results might suddenly see your driver and team aiming for third in the championship, rather than first, or a series of exceptional wins could put your team on course for winning the championship, where your initial goal at the start of the season was a top-five finish.
The evolution mindset
3M is an American company that you might be familiar with and it perfectly encapsulates the evolution mindset that we're exploring in this chapter.1
In the 1970s, 3M used to be called Minnesota Mining and Manufacturing and at this time its scientists received a patent for the chemical formula that it was using to make masking tape, which had been in production since the 1950s. The story goes that the board was torn between whether to become a product company or a knowledge and know-how company.
If the board had chosen to become a product company, the company's product would have been masking tape. Of course, the company would have made different types, colours, and sizes of masking tape, but it would have pinned itself into a specific niche.
The board chose to go down the route of becoming a knowledge and know-how company, and 3M has since spawned over 60,000 products from that one chemical formula. The core of 3M is that formula, and it has used that to continuously evolve and create new things.
Whether the board members recognised it at the time or not, they chose to go down a route of continuously adapting. They chose a process of continuous evolution. This is supported by the fact that 3M puts a material percentage of its turnover back into R&D and it encourages its employees to come up with new products and solutions. It empowers its people based on this core principle of adapting and evolving. It's an evolution mindset that starts at the top and filters all the way through the organisation.
The Bandersnatch process
In business, we have to pivot and change direction sometimes and it's important to remember that the destination we're striving for could also change depending on the route we follow. We also have to recognise that we are never going to reach that destination because that implies an end point. In business, there is no end, merely a constant evolution and adaptation to stay ahead of the competition. Just look at 3M.
The interactive film Bandersnatch, which was produced as part of the Black Mirror series for Netflix, is a simplified example of this process at work. As the viewer, you chose the direction the storyline took at various points throughout the film. In taking certain decisions around the plot, you influenced the ending that you saw. Unlike the world of business, Bandersnatch does of course have an end.
However, it illustrates the point about choosing your direction of travel well. Much like in real life, in Bandersnatch you don't know what ending you're heading towards when you start watching the film. Each decision you take for the main character leads you along a specific story arc. You're essentially opening a door and stepping through it without knowing what's on the other side, even if you might be able to predict what you expect to see.
Another key difference between Bandersnatch and business is that in Bandersnatch you can never go back. Once you take a decision about your direction of travel you are committed to that trajectory. In business, this might be true in some cases, but not in others. Often it will be possible to step back through a metaphorical door.
What we have to recognise in a business context is which doors we can leave open to step back through if we need to, and which ones close behind us, leaving us to navigate forward from that point. As a business, it's vital to make that distinction because if you're stepping through a door that will close behind you, you need to be confident of your next steps from there.
How can you tell if the door you're about to step through will stay ajar or close behind you? There are a few factors that will play a role here. The first is the speed at which you're travelling through that door, because if you race through really quickly, by the time you realise you want to go back, you might be too far from the door. The second is measurement, which we discuss in greater detail in Chapter 2, but fundamentally if you're measuring the right things you will be in a position to retrospectively change the elements that need changing.
Each business will be different and therefore whether it is able to go back through a door will vary. However, all leaders should be challenging themselves on these decisions. As a leader, what you have to work out is whether getting a particular decision wrong is reversible. If the answer to that question is “no”, you have to take time to make that decision.
If the decision won't kill your business, you have to consider what the cost will be for you to step back through that door and course correct. The deciding factor should be whether the opportunity outweighs the risk of making the decision quickly.
Don't proxy process for performance
Picture the scene: You're in a meeting with a client pitching them an innovative solution that you've invented. It's going to cost your client £1 million per year to buy this solution, and they have estimated the opportunity cost for them will be £25 million. You know your solution is ahead of the market and, because it's not available through any other providers, you're confident as you walk through your pitch.
It's a slam-dunk…. Or is it?
There are many examples in business where process gets in the way of logic. Logically you would think that spending £1 million a year to gain £24 million is a no-brainer for a business of any size. However, here is an example of where this has played out in a global organisation.
A client firm was offered a solution to a specific business problem that was not available from any other provider at that time. However, the client firm was concerned that, because the solution wasn't available with any other providers, the firm might not be getting a fair deal. As part of its procurement process, the firm mandated the company pitching to go to tender for the project. Can you see where this is going?
Essentially this meant that the supplier had to facilitate competitors to pitch on its idea. Following the tender process, the client firm was concerned that the supplier might be £200 000 more expensive than the other options. Remember that the opportunity cost to the client was £25 million per year, and that the supplier had the solution ready to go. The client took two years to make a decision, at which point it chose the initial supplier, which was the organisation that pitched the idea in the first place.
The client lost £50 million in opportunity cost to make sure it wasn't spending £200 000 a year more than it should. Its process completely dominated logic. There is a good chance that if the client had paid the £1 million, it could have saved two years of time and taken a chunk of that £50 million in opportunity cost.
This story highlights the danger of allowing your process to dominate logic. We can all think of scenarios in which a business decision has been driven by process rather than by the opportunity that the decision carries. As businesses grow, they become more process-driven and they start to put each decision through the same process; whether it's for a £100 000 project or a £20 million project.
Sometimes you just have to let the logical solution take over and leave the processes behind. If a Formula 1 driver spots a gap in the race to jump up a few places to a pole position, the principal can't let that opportunity slip just because it's not on the race plan, but instead adapts the plan.
Emotional intelligence is more than a process
There is a lot of talk within businesses across all sectors about the need to have empathy. However, we believe that focusing only on empathy isn't enough. What businesses need instead is to focus on emotional intelligence. What's the difference?
Empathy often feels like a box that needs to be ticked. Are you empathetic with customers? Yes, good, job done. In some companies you can almost hear them saying, “If you want empathy, go down the corridor and it's the third door on the left.” This misses the point.
Emotional intelligence (EQ), on the other hand, is much more about empowerment. Empathy is a part of that, but when you focus on emotional intelligence within your organisation, what you're doing is empowering people to think differently and giving them the authority to make decisions that are in the best interests of your customers and, therefore, your business.
Rich's take
Would you like a free coffee?
Pret a Manger is a great example of a company that allows and encourages its staff to use EQ when dealing with customers. It gives its customer-facing staff the authority to give away a certain amount of free product each week, but it doesn't specify who should receive that free product.
It's at staff members' discretion who they give those freebies to. I benefited from this policy when I used to buy a coffee from a Pret store near my office every morning. One of the baristas who worked there got to know me and, some days, she'd spot me at the back of the queue and nudge me to the front, hand me a free latte and I'd be on my way.
Now, I'm sure that in many instances the barista had mistakenly made a latte when someone ordered a cappuccino, so she had a spare latte and would give it to me. But she had the power to use that mistake to delight a regular customer.
Principles guide the business
The reason that having solid principles is so important is that you can't possibly map every single customer journey or interaction, or predict every single reason that a customer might get in touch with your business.
What you can do is embed a set of principles so deeply into your company that everyone knows how to respond in any situation in a way that matches your brand.
Rich's take
Can you help us improve, please?
I've been a customer with Harry's, which provides a razor blade subscription service, for some time, and at Christmas the company emailed me about a special edition razor it was offering. It wasn't expensive at £24, and for an extra £10 I had the option of having it engraved.
I thought an engraved razor would make a nice gift for my son, so I ordered one. When it arrived, my first thought was that my order was wrong because all I could see was “Harry's” written on the top of the razor. Then I realised that my son's initials were engraved on the bottom of the handle, and the engraving was so faint I could barely read it.
