Guest Post: I have another treat for you today. Scott Anthony, President of Innosight, a global consultancy founded by innovation guru Clayton Christensen is doing the second of two articles for us. Scott is a consultant to Fortune 500 companies, thought leader on strategy; featured speaker on growth, innovation, and entrepreneurialism. He is the author of The Silver Lining: An Innovation Playbook for Uncertain Times (Harvard Business Press, 6/1/09) about how past economic breakdowns have led to some of our greatest business breakthroughs since 1850. Our current times are no exception; Scott Anthony delivers the message, the tools, and the advice that everyone needs to survive — and lead — out of this downturn. I really enjoyed his first article and I think this one might just be even better. I hope that you like it as much as I did. Thank you Scott!
To Reinvent Your Company, Reinvent Yourself
By: Scott D. Anthony
www.silverliningplaybook.com
As if the non‐stop economic challenges of the past two years weren’t bad enough, a hidden crisis is beginning to emerge from the economic rubble of 2007‐2008: corporate leaders have to deal with a challenge for which they are completely unprepared.
Companies are increasingly recognizing that today’s turbulent times require nothing short of continual reinvention. Weathering today’s storm isn’t enough. Companies have to develop repeatable processes that regularly renew their firms before the next crisis hits. This kind of renewal must begin with the leaders themselves.
For generations the United States had a culture that supported entrepreneurialism and the creation of new growth businesses. Silicon Valley was the embodiment of this culture. Today individuals and the companies that house them must develop this ability.
Companies have to build a “dual core” culture that excels at building new growth businesses while harnessing the full potential of existing businesses. It is a tough challenge. Consider the seemingly paradoxical demands this challenge places on leaders’ plates:
• I have to focus on running operations with laser‐like precision without stifling creativity.
• I am valued today for my big, existing businesses, but today’s small businesses are critical for longterm success.
• Attention to detail and focus on numbers has allowed me to progress in my career, but too much detail‐ or number‐orientation can crowd out innovation.
• I have to leverage current capabilities to win in today’s markets, and forget many of these capabilities to win in tomorrow’s markets.
These challenges call into mind the old words of F. Scott Fitzgerald: “The test of a first‐rate intelligence is the ability to hold two opposed ideas in the same mind at the same time, and still retain the ability to function.”
Passing Fitzgerald’s test requires that leaders manage two different “gut instincts” at the same time, one more operational and one more entrepreneurial. Few leaders—Apple’s Steve Jobs comes to mind—do this well, and even then one side of the gut usually dominates. Importantly, individual leaders who can personally pass Fitzgerald’s test often can’t crisply articulate how they do so, which inhibits their ability to develop and select the next generation of leaders.
The good news? Researchers, such as Harvard’s Robert Kegan in his book In Over Our Heads, have mapped out the stages of inner development that one must traverse to be an effective multi‐selved leader. The bad news? Kegan’s research shows what we instinctively know—only a tiny fraction of adults, even the leaders of global firms, reach a self‐development stage where they can confidently confront paradox.
It seems counterintuitive that achievement‐oriented managers haven’t naturally achieved personal development levels that allow them to master these kinds of challenges. The problem isn’t a lack of basic intelligence, desire, or capacity. Rather, managers haven’t developed the ability to grapple with paradox because they haven’t needed to.
Modern capitalism has been on a spectacular run since the World War II. Today’s leaders operate global diversified businesses on an enormous scale. The ability to handle paradox has marginal incremental utility to these challenges. In fact, natural selection would weed out managers who possess balanced skills in favor of those whose skills are uniquely attuned to the needs of the time.
Hyper‐competitive markets with shrinking windows of competitive advantage mean that leaders have to develop these skills, and fast.
There’s no silver bullet to address this challenge, but the following three tips can help leaders begin the necessary process of personal reinvention.
Albert Einstein once defined insanity as doing the same thing and expecting different results. Einstein would surely raise his eyebrows at companies that ask mono‐focused, execution‐minded leaders to spearhead corporate reinvention efforts. Leaders need to start the process of personal reinvention soon, or suffer the inevitable consequences.
Feel free to ask questions or let us know what you think in the comments. And check out the web site for Scott’s book at The Silver Lining.
