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Three Aspects Required for Winning in a Turn

by Mark P. McDonald  |  December 4, 2019  |  Comments Off on Three Aspects Required for Winning in a Turn

A turn represents the context behind proactive and productive change. It embodies a sign of disruption.  The need for a new perspective and the opportunity to take different actions.  That combination is the essence of a turn.   Knowing what a turn is, represents one thing.  The real issue is what you do about a turn now that you recognize its nature.

Executives and organizations who win in the turn act because they are able to see the world differently from their peers in ways that matter.  That perspective becomes apparent when you look at differences between companies as they faced past turns.

Three aspects of Winning in a Turn

Organizations that win in a turn are those that are able to act when others either react.  React in the sense of hoping things will get better.  They either continue their current course of action or they pull in their ambition and seek to ride out the change.  It’s a difference that matters across three aspects.

  • Beliefs  – what you and the organization’s world view is, what you see as important and where you see yourself and the world going.   Beliefs are critical in a turn as they form the basis for comparative advantage – the why you are going against the currents of conventional wisdom.
  • Actions – how are you responding to those beliefs, particularly when external situations lead to new opportunities.  You see these opportunities based on your beliefs.  You take action because they are consistent with what you believe.
  • Focus – what is important, the central thing that you are taking action to improve.  The focus is the collection of outcomes, resources and areas where your actions drive future growth.

It’s a simple framework but one that provides a way to illustrate these differences.

Consider how companies navigated the “Great Recession of 2007 – 2009” which was a major economic turn.  A study of 4,700 public companies regarding how they fared during a recession indicated that 9% of companies not only recovered, but they outperformed competitors by more than 10% in sales and profit growth in the three years after the recession.   Anecdotally, when talking to these executives there was a pattern that was different from others in terms of their beliefs, actions and focus.

Conventional wisdom in the recession could be described by the following: People believed that the recession represented a ‘new normal’ as popularized as the time by McKinsey. They believed that the way things were in the recession would largely be the way they would be going forward.  The actions they took in response to those beliefs, involved reducing investments cutting operating costs and broad layoffs.   Their focus was on collecting and hoarding cash, even if it was to the detriment of customer relationships.

There is nothing wrong with those beliefs, actions and focus.  In fact, that combination is a classic – ride out the recession – playbook.  It was one followed by the vast majority of companies and leaders, often with the implied logic being ‘if you do not survive, then you cannot thrive.’  It all makes sense and is sound ‘normal’ change responses.  But it was not the only way to respond.

Companies that won in the turn, grew revenues and profits faster than their peers after the recession, held a different set of beliefs, actions and focus.  Again it’s a generalization, but they believed and knew that the economy would recover.  They did cut costs, but based on their belief they did more.  Their belief led to actions that rationalized – cut and reallocated resources (money, operations and people) – in products and capabilities that would be in demand in a recovery.  Those actions gave differentiated their focus on the customers that would matter to them in a recover, regardless of when a recovery occurred.

Beliefs, actions and focus provide a way to describe the requirements associated with leading and winning in a  turn.

  • So what do you believe about the near future? Are those beliefs different than the market in ways that matter?   Are those beliefs driving decisions and their  execution?
  • In terms of actions, are they consistent with the beliefs or is one action cancelling out others?  Are your actions accretive, in that they build on one another?  Are they producing the results you need?
  • Finally, focus in terms of placing the right resources, priorities and commitments to actions consistently with beliefs?  Do you have more than one area of focus?  Do you need only one?  Are you achieving progress in your focus areas or have you deferred to do the easier stuff?

Related Posts

The inflation of change and turns

What is a turn?

Additional Resources

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Category: leadership  strategic-planning  winning-in-the-turns  

Mark McDonald
VP Analyst
12 years at Gartner
33 years IT Industry

Mark McDonald, Ph.D., is a Vice President and Fellow Emeritus in Gartner for General Managers Program. Read Full Bio

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