Start With A Win - Rich Horwath: Stop Wasting Time on Business Strategy That Doesn't Work

Starting point is 00:00:00 If it doesn't fit with our strategy, then we need to deprioritize that. And I see too many leaders, Adam, that don't have priorities. Everything's a priority. And if everything's a priority, then nothing gets really done well. Do we have a strategy in writing that acts as a filter? So when fire drills come up, when new opportunities come up, we don't just react and do them, but we really step back and think about, does this fit with the strategy that's going to help us win? Welcome to Start With a Win, where we unpack leadership, personal growth and development, and how to build a better business.

Starting point is 00:00:34 Let's go. Coming to you from Area 15 Ventures and Start With a Win headquarters, it's Adam Contos with Start with a Win. Rich Horwith is the founder and CEO of the Strategic Thinking Institute, where he helps executive teams think, plan, and act strategically to create real advantage in their businesses. He's in New York Times, Wall Street Journal, and USA Today, bestselling author, eight books, deep and has been called the world's foremost expert on strategic thinking by Chief Executive Magazine. Rich has coached and trained more than a quarter million leaders worldwide. He's been featured in Fast Company, Forbes, and Harvard Business Review, and he appears regularly on major networks like ABC, NBC, CBS, and Fox to talk business strategy. Today we're digging deep into what it

Starting point is 00:01:24 actually takes to think strategically in today's chaotic world and how you can use that mindset to start your own day and your team with a win. Rich, welcome to start with a win. Thanks, Adam. Great to be with you. Hey, I mean, you're kind of the the guy when it comes to strategic thinking and business strategy. You have a great, great background of doing this and a lot of experience. So I'm really excited about talking to you today because, I mean, without strategy, we really have no map to get to where we want to go. So how did you get involved in strategy and strategic thinking? Yeah, Adam, so I'm going to date myself a little bit here about 25 years ago. I was working for a marketing firm, and I was basically writing strategic plans for clients. And we had an off-site meeting,

Starting point is 00:02:12 you know, a typical two-day off-site meeting. And we had a coffee break. And one of the managers came up at the break and said, hey, Rich, I just had my performance review with my manager. And she said, I'm way too tactical. She said, I need to be more strategic. He said, how do you do that? And so, Adam, this is about 25 years ago. Most of the books on strategy were really about kind of corporate strategy, business unit strategy, but not really anything for the individual leader to be more strategic day in and day out. And so that was really my lightball moment to say, hey, this sounds like a need that a lot of folks have that I'd be interested in trying to research. So I spent a bunch of years researching, writing, and then really starting to put some concrete

Starting point is 00:02:57 frameworks and tools around what it means to be strategic. Awesome. I'm glad you said that because it seems like strategy, the word strategy or strategic is such a buzzword in so many different conversations and business. How do you define it in a way that actually drives action? Yeah, Adam, you've probably been in the same rooms I have where, you know, you're in a meeting and everybody starts putting strategic in front of every word. Well, you know, strategic goals and strategic objectives and strategic big rocks and strategy. So it gets kind of crazy.

Starting point is 00:03:30 And so, you know, what I like to do is go back to our eye. Let's think about what is strategy. And strategy actually started in the military arena thousands of years ago back with Sun Su, the Chinese general philosopher, the writings, which you know became the book, The Art of War. And really, we can define strategy in lots of different ways. And actually, in the literature, over the last couple of years, there's 91 different definitions of strategy, which is crazy. So I like to define it really simply as three words, how to win. And so when we think about how to win, it's really what's your plan that's going to get you from where you are today to where you want to go?

Starting point is 00:04:11 You know, good example, Mary Barra, she is the CEO of General Motors. And she took over back in 2014. and when she came in, they were coming out of bankruptcy. They had a lot of issues. And she said right away in her first press conference, she said, look, we're here to win. We are not going to win by being all things to all people everywhere. She said, that's not strategy. I think that was a great comment because, again, I think we get so caught up in activity

Starting point is 00:04:39 for activity's sake that we forget to step back and think about strategy, which is really how to win. Awesome. I mean, it seems like it is an undefined, overused word for sure in the corporate environment, as well as, you know, I guess any organization comes down with their strategic plan and strategic directives and strategic initiatives and just, I don't know, it just like stabbed me in the face with my pen type situation. But I mean, the reality is we're trying to get stuff done here. And, you know, there are a lot of mistakes that lead. make in trying to lay out the strategy. So let's start with some of the wrong things that people do when it comes to laying out

Starting point is 00:05:25 the strategy or, you know, they, they miss a point or there's just this squishy area that never gets addressed or anything of that nature. Tell me, what do you see in the complications with developing strategy in the corporate environment or with leaders who have not been trained on how to become strategic? Yeah, it's a great question. And one of the things I'd say initially is David Novak, he's the former C of Young Brands, includes popular companies such as KFC, Pizza and Taco Bell. You know, one of the things he said when he was retiring from Young Brands, he said, you've got to take time to reflect. He said it's the stillness that leads to the action.

Starting point is 00:06:06 And I'd say that's the biggest mistake that most leaders make is because we want to be effective, a lot of leaders are type A people, get stuff done. And that's important. but we also need to take time to reflect on what are we doing? Why are we doing it? And how could we do it differently or better? And so I would say that's the one thing I'd really share with folks is, are you taking time to think? Because the reality is most of us are reacting instead of being proactive. You get up in the morning, we've got our phone, there's text messages, there's emails, there's voicemails. And so immediately we're on defense. We're reacting to everything.

Starting point is 00:06:47 So I'd say the biggest mistake is as leaders, we're not being proactive. We're not on offense. We're not really taking time to think about what are the important things. And are we doing those versus the stuff that's just urgent? Interesting. Let me ask you about this other concept as well. And I 100% agree with you there. You know, everybody does become so reactionary and just doesn't stick to the game plan.

Starting point is 00:07:12 But a lot of times they create the game plan. and they put it in a drawer and they don't look at it for 12 months or until the next board meeting or something of that nature. How important is it to have a personal strategy as a leader as well as, you know, tie that into your business strategy and see it? I mean, how often should we be looking at this thing? Yeah, Adam, it's a great point. It's funny. I've got buddies that coach peewee football. So, you know, eight years old, 10 years old, you know, playing pee wee football. And these guys are spending 10 to 12 hours a week game planning for these people. Pee-wee football games.

Starting point is 00:07:45 And they've got the game plans in writing. And then I talked to some leaders. They're like, well, you know, Rich, I don't have time to put my plan in writing. Yeah, you've got to put your plan in writing. If you don't have your plan in writing, you're less prepared for your work than a pee-wee football coach. So I'm a big believer. You have to have it in writing. Unless you're a solopreneur, and even if you are, I'd still encourage you do it.

Starting point is 00:08:05 But if you work with any other people, they've got to understand what they should be doing day in and day. where should they be putting their time, their attention, the budget, the resources. And the way we do that is we have a strategy in writing. And so we've got a strategy in writing. And typically I like to see it as a one or two page game plan or blueprint, whatever term you want to use, but it should be pretty condensed. Adam, you're exactly right. Most people do a plan. And then like you said, it goes in a drawer. It sits in an Excel or PowerPoint file for the year. And they don't look at it. Why? Because it's 30 slides, 40 slides. It's 15 spreadsheets, right? I mean, we're not going to update that. We're not going to look at it. So I'm a big believer that have a one or two page plan with really, what are you trying to achieve, your goals and objectives, and then how are you going to do it? Your strategy and tactics and add some metrics and accountability there. And I think that's a good place to start. Awesome. And let's, you know, you talk about goals and objectives, things like that. And you also mentioned strategy versus tactics.

Starting point is 00:09:10 earlier. How do we put this thing in the play? I mean, we've got to have execution and action instead of just something fun that's written on the wall. So how does that transition work? How do you teach leaders to and really not scare employees away by doing so where everybody's marching to the same drum? Yeah, yeah. It's a really good point, Adam. One of the things I see a lot of times is people are like, strategy is not my job. I get strategy from the brand team or the CEO, and people abdicate that responsibility. But the reality is every one of us is a strategist, because we all have time, attention, talent, and budget. And so how we use those resources every day is our strategy. And so we can have whatever we want written in the PowerPoint deck,

Starting point is 00:10:01 but how we're using our resources every day is really our strategy. So, you know, to make it super simple, I ask every employee, every leader to answer two questions. What are you trying to achieve and how are you going to do it? So the what question, what are you trying to achieve? And then the how question, how are you going to achieve it? And so the what question, and again, I use a ghost framework real simple, goals and objectives, answer the what question. goal is generally what you're trying to achieve.

Starting point is 00:10:32 Objective is specific. So you're going to put a time frame and a metric, a number on it. And then strategy and tactics answer the how question. Strategy is generally how are we going to get there. And then tactics are the specific, tangible things that we're going to do. So to your point, Adam, I mean, the way that we make strategy into execution is everybody has an answer to those two questions for their job. So what am I trying to achieve this week, this month, this year?

Starting point is 00:10:59 and then how am I going about it? And again, as we go throughout the year, the key that you've touched on is we've got to be updating that. So once we've achieved a goal, we take it off. If the competition has come in and done something different, then maybe we need to change that. So back to your earlier question, which is a great one,

Starting point is 00:11:16 I would say at least every quarter, if not every month, we need to look at our strategy and say, okay, are we doing the things that are going to help us win? Yeah, I mean, I, I mean, I remember when, you know, everybody was talking about annual planning and annual strategic meetings and stuff like that. And then Google came out and said, no, we only do it every 90 days. Yeah. So, I mean, it's, is that a good pace, you think?

Starting point is 00:11:42 I mean, I believe an annual strategic meeting is a waste of time because all you're doing is blowing off the dust and remembering what you didn't get done in the last nine months. So, I mean, what are your thoughts on that as far as how is, do you set your consulting clients through? a frequency and then require they stick to that, or what do you typically do for a time frame? Yeah, it's a key idea, this idea of 90 days, one quarter, because that gives a, that could make strategy much more action-oriented. To your point, if we've got a one-year, three-year, five-year plan, strategy feels like it's inert, like it's a rock. I mean, when I'm doing anything with it, in my world, strategy and action have to blend together. And so to your point, I like every 90 days. I actually recommend, to your point, instead of just doing one big annual meeting,

Starting point is 00:12:34 I like to recommend folks do a strategy tune-up. You know, just like we get our cars tuned up, our trucks tuned up, you know, every couple times a year, you know, get the oil change, the filters checked and tires, rotated, stuff like that. Same thing with the business. So every 90 days, you know, spend, I recommend spend one to two hours as a team and talk about what's working, what's not working, what's changed from a customer, competitor, market perspective, and then are the strategies we have still viable? And if they are, great. And if not, then let's make some modifications. And it's a great point you bring up at it because if strategy is only happening once a year, like a birthday, where there's a lot of signage and fanfare, it goes away, then we're

Starting point is 00:13:16 not going to be updating it during the year. And if we're not updating it, then we're potentially losing the opportunity to be successful. McKinsey came out with really interesting research that showed the number one driver of revenue growth. So we're all, you know, most of us that are for profit want to make more revenue. The number one driver is the reallocation of resources throughout the year from stuff that's not working to stuff that is working. So to your point, Adam, if we only reallocate resource and do our plan once a year,

Starting point is 00:13:47 we're way behind from a reallocation standpoint. Awesome. And I mean, you're, you know, Gallup talking in the Q12 survey, they talk about engagement, things like that. 70% of the impact of employee engagement and the results of an organization are because of middle management. Yes.

Starting point is 00:14:05 How are we missing middle management with strategy? Because it seems like they just show up again and they're like, I'm protecting my team. I'm going to manage my team. But it seems like strategy failures or fails to filter through middle management. How do we fix that as a leader? Yeah, it's a great point. There's a lot of people thinking that, you know, middle management is tactics, upper management is strategy. But again, I do believe that I've seen organizations where people set strategy at the C-suite level, the VP level,

Starting point is 00:14:36 but then I talked to the middle managers, the frontline managers, the sales reps, and they're not doing it. You know, they're selling on rebates. They're selling on lower price. When, when the strategy is we want to be a premier brand, a premium brand in the market, but what's happening in the day-to-day doesn't marry up with that. So I'm a big believer that senior leaders, when they're setting strategy, let's say every 90 days, you bring in a couple middle managers, frontline managers, sales reps, people from HR finance, some of your high-performance, high-potential people,

Starting point is 00:15:11 and you have them involved in those conversations. Because if you would involve those people in conversations, now they're going to be much more engaged, and they're going to be much more committed to executing the strategy. If we just hand strategy down like the Ten Commandments, then people are going to be like, well, yeah, maybe I'll do it, maybe I won't, but there's no buy-in. And so the research shows that if you give people a why,

Starting point is 00:15:33 here's why we're doing it, you sit them down, you have a conversation, you get their input, the buy-in level goes from 60% to 93%. So that's a huge jump. So all the leaders out there, I would really challenge all of us to think, about are we engaging people throughout the organization in conversations about the key business issues? People are hungry to talk about that, Adam, but we're not always giving them the form to do

Starting point is 00:15:58 it. It seems like they want to participate in it. They want to feel the value of being part of something greater in the organization. We just build these firewalls in the organization for some reason that prevent them from doing that. And that takes me to, you know, you mentioned the word culture and buy-in and things like that. I've, you know, we've all heard the term culture each strategy for breakfast, which I think is, you know, it's, it's not binary here. It's not one or the other. But obviously, we need to have a good culture in order to absorb and pursue the strategy. How do you get over, you know, bad culture, good strategy or bad strategy, good culture, things like that? How do you merge those things, too, in your, in your consulting so that both

Starting point is 00:16:43 of them flow together. Yeah, Adam, I love the way that you put that, that it's not binary, it's not one or the other, because I believe that same thing, too. I mean, I've worked with organizations that had great culture, but no direction. And, you know, they're just wandering. And then you've got companies with really good strategy, bad culture, you know, think about the Enron's of the world back in the day, you know, that blow up, right? Because, and it's interesting, too, the last couple years, the number one reason that

Starting point is 00:17:13 CEOs and Fortune 500 companies have been let go, it's not financial performance and strategy. It's more the emotional intelligence and the lack of leadership and being an ethical leader with strong character. That's been the number one driver. So it's a really key thing for leaders to think about is strategy and culture. And the way that I think about it is strategy is really setting the direction to win. And then culture is really what are those three to five behaviors that are going to drive who we are as a team day in and day out. Because culture is basically, you know, one of our core values, but then that's manifested in our behaviors.

Starting point is 00:17:54 So I'm a big believer that culture needs to be, like you said, I mean, it's not just a statement on the wall, you know, our mission is X or Y, but it's really, what is a leader, what are the two or three or four behaviors you want to see from your people day in and day out? Do you want to see risk taking? Do you want to see innovation? What are those behaviors and what does that look like?

Starting point is 00:18:18 Oh, totally. That's a great point. Yeah, I guess a lot of it's coming back to this concept that you've really talked about where strategy is a mindset. And I really love that. It's mindset not a meeting. And, you know, we're trying to make strategy and mindset, not just in leadership, but throughout the organization.

Starting point is 00:18:40 I mean, it comes down to the boss saying that, providing clarity on it. How do we, I mean, you've seen a lot of clarity introduced into organizations in strategy. What some aha moments that you can share with us about that? Yeah, you know, I would say the first thing is we need to have a simple, a simple framework to help us be strategic day in and day out because, you know, We're not going to remember a 400-page book or, you know, a textbook. And, you know, so we need something that's going to trigger that. So I like to share with leaders three A's acumen, allocation and action.

Starting point is 00:19:19 And so acumen's the insight. So every day as a leader, what are your, and I define an insight, Adam, as a learning that leads to new value. So as a leader, we've got to go in each day with an explorer's mindset. Not going in thinking we know it all, we've seen it all, we've done it. at all, but really with an explorers mindset to say, what can I learn today about my people, about the culture, about what's working, what's not working, about my competition, about my customers. And so once we have those new learnings, that then should feed into our allocation,

Starting point is 00:19:52 meaning, all right, we just learned this about our competition. How might we use our resources to outperform them or outthink them in that area? And then action is really, what are we doing to prioritize what's important versus urgent. So again, as a leader, I would think about that, those three A's, acumen, what's the insight, the new learning, the new value that we can provide, allocation, where should we be putting our resources? We've got to make tradeoffs. And then action, really, what are the key priorities? And are we living those priorities day in and day out? I think you hit a major piece of gold there, you know, prioritize the important versus the urgent. It seems like the urgent is what rips us away from our strategy on a regular basis.

Starting point is 00:20:40 You know, somebody runs around hair on fire. There's a angry client, whatever it is. Strategy comes to a screeching halt because we feel like we need to address this particular situation. But at the same time, the key things we should be working on never change every day. Right? I mean, it's, I mean, we need to teach ourselves to be disciplined and not get ripped away. from our strategy. Is that a fair statement? Yeah, that's really well said. You know, the fire drill thing I see all the time with people. And that's one of the reasons to go back to your question earlier,

Starting point is 00:21:15 which was a great question. You know, do we need strategy in writing? What does that look like? And that's the reason we want to have strategy in writing, because if we have strategy in writing, that then becomes our strategy then becomes a filter. So when stuff pops up, fire drills, a customer says, hey, I want X or I want Y. We don't just think about it. in isolation by itself and say, hey, that looks like a good opportunity. Let's go do it. We say, okay, what is our strategy? Let's overlay what we've chosen as a leadership team to focus on. Now, how does this issue that popped up in opportunity, a threat? How does that fit with our strategy? If it doesn't fit with our strategy, then we need to deprioritize that. And I see too many

Starting point is 00:21:58 leaders, Adam, that don't have priorities. Everything's a priority. And if everything's a priority, then nothing gets really done well. And so I would encourage people to really think about, do we have a strategy in writing that acts as a filter? So when fire drills come up, when new opportunities come up, we don't just react and do them, but we really step back and think about,

Starting point is 00:22:20 does this fit with the strategy that's going to help us win? It's interesting to say that because if you look at the different meetings that people go in throughout the day, nobody ever reviews their strategy at the beginning of the meeting. We're trying to accomplish this, this, and this. Yes.

Starting point is 00:22:36 But instead they go to the meeting with different people's pet projects or what have you. And the strategy never gets impacted by that. It's just their pet projects. So, I mean, it's, go ahead. That is a golden insight that you just had there. So I hope folks write that down. When you go into a meeting, do you have an agenda? Are you spending some meeting time on strategy?

Starting point is 00:22:57 I mean, that's such a key point that you brought up. Because if we're not spending time on strategy, and I've been in a lot of those meetings, and a lot of times it's the fire drill of the month. It's, you know, a new competitor did X or, you know, something popped up, but it's not really on the big picture issues. And so I'm a big believer that leaders need to think about how much time are they allocating on the current state of the business and then how much on the future state. So are you preparing your team to be successful three months, six months, 12 months from now,

Starting point is 00:23:27 or we just focused on today. Today is important. Absolutely. We've got to keep the lights on. so forth, but we also want to think about how much time are we putting into the future state of the business as well. And teams get excited to talk about that because it's motivating. Oh, yeah. I mean, frankly, I feel like we're in a strategy therapy session right now with that. And, you know, listening to you talk about the fire drills and things like that, it seems

Starting point is 00:23:51 like, all right, you have a week of fire drills. You've just taken and massively change the culture and not knowing it, you've changed a strategy of your organization because you veered a from it most likely during that time. And unless you pull out the strategy document and reset yourself to what are we here to do, you're not going back to that strategy, it seems like. Yeah, exactly. Back to your point earlier on culture, you know, one of the behaviors then that you see manifested that maybe you don't want is we're reactive. We're hyper reactive to fire drills. And that that is a behavior that is prominent in a lot of organizations. So if we have that habit, you know, it starts at the top. So as leaders, if you're reacting and you're kicking stuff to

Starting point is 00:24:38 your leadership team without filtering it and everything goes to them and, hey, take care of that and do that and do that, even though it may not fit with the strategy, then you've built a culture around reactivity. And so that's probably something that's not going to be as productive moving forward. Awesome. Hey, so, you know, to kind of wrap this up, we've talked a lot about, you know, strategic direction, things of that nature. What's a habit? What's a habit? that you see in in key organizations or in key leaders, that really help them stick to and accomplish their strategy. Is there a particular habit or a particular process or something to read into the organization,

Starting point is 00:25:15 something like that that you're seeing consistently that is causing the wins? Yeah, there's a couple. But the first one I would mention is this idea of scoring interactions. And what I mean by that, you know, we're all fans, a lot of people out there are fans of football. baseball. I mean, if they played without a scoreboard, we probably lose interest at some point. So I like to have leaders, you know, take a couple weeks and just walk around with a note card or even on your phone. And every meeting that you go in, score it on the level of value that meeting or that interaction that one-on-one you had with somebody, the conversation around competition,

Starting point is 00:25:55 score it from a scale of zero, no value, three to high value. And after a couple weeks of, doing that, you see very quickly where you're wasting time, where you're wasting energy on stuff that's continually a zero or one on value to you or to your team. So that's one habit I see is people, you know, once a quarter, taking a week or two and just scoring their interactions, their meetings, all of the things that they put their time to, to say, what am I doing that's valuable? And what am I doing that's not valuable? And if we can start to change even an hour or two a week, boy, that winds up being $50,00 a year where we could be spending more time on productive stuff.

Starting point is 00:26:38 Wow, that's great. I'm writing that down. Yeah, that's fantastic. So, I mean, this has been really insightful. There's a lot more to learn about strategy. And Rich, you've done a great deal of work around this between the books you've written and the information you've put out there. Where can people find you and learn more about strategy?

Starting point is 00:26:59 Yeah, Adam, I'm a big believer in. sharing as much free stuff as we can. So I've got a website called strategy skills.com. So strategy skills.com. So I've got lots of free white papers, videos, audios, infographics, a lot of stuff to help you get started if you feel like you or your team aren't thinking strategically or don't have good direction.

Starting point is 00:27:20 So I would definitely point folks in that direction. And a lot of what we've talked about is in my last book, Strategic, which came out a couple years ago. again, you know, just trying to help leaders, you know, think about how do we win on a regular basis. Awesome. Yeah. So make sure you check out strategy skills.com, everybody, as well as Rich's latest book.

Starting point is 00:27:44 He's got several of them out, and they're all really good, frankly. And also has a YouTube channel, Instagram, X. You're all over the socials. So everybody, make sure you check out Rich online. Rich, I have a question I ask everybody on Start with a Win. And that's, how do you start your day with a win? And maybe it's strategic. Who knows?

Starting point is 00:28:07 Yeah, it's a great question. As I followed your podcast, I was hoping I would get this one too. So one of the things I do in the morning, Adam, to start my day is a mental workout. And, you know, a lot of us do physical workouts. The average CEO works out 45 minutes a day physically. but a lot of leaders like ourselves don't necessarily do a mental workout. So it's real simple in nature. It just takes about three, four minutes.

Starting point is 00:28:31 But what I start with is performance statements. So I have three to five statements, just one sentence, on how I can perform well today. So one performance example statement might be, I'm going to listen for three seconds intently before I respond to anyone I'm talking to. So hopefully I'm being a better leader that way. then after the after spending a minute or two on performance about a minute on performance statements then i do spend about a minute or two on visualization so i look i think about what meetings i have

Starting point is 00:29:02 if i'm doing a speech that day or a workshop what do i have going that day and then i visualize myself in those meetings in those situations you know performing hopefully to the best of my ability and then finally i end with one or two identity statements who am i so one one identity statement might be, you know, I'm a tenacious competitor who helps leaders perform to their best potential. That might be an identity statement. So, again, it's just a way each morning to help me reset on, you know, who I am and who I'm trying to serve. I love that, that mental programming. And really, I mean, that is your strategy for the day.

Starting point is 00:29:40 It's fantastic. Yeah. So that works awesome. Rich Horwith, this has been an amazing conversation about strategy. You have really enlightened our audience and myself. frankly, and I've been a student of strategy for many decades. This has been fascinating. So we appreciate all you do. Thank you for being on Start with a Win, and we look forward to talking to you next time. Thanks, Adam. Really appreciate it.

Start With A Win - Rich Horwath: Stop Wasting Time on Business Strategy That Doesn't Work

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