THINKING ABOUT STRATEGIC THINKING

Ned Herrmann loved to laugh, and he loved to tell a good story to make a point. At one of his seminars about the whole brain, I heard Ned tell of a business meeting during his tenure as an HR manager at General Electric in which an exasperated executive blurted out, What the hell does the brain have to do with business? One can imagine that executive sitting on his hands, impatiently listening to Ned talk about psycho-physiology when there were decisions to be made. Ned could barely finish this anecdote before breaking into a fit of laughter. Everything that Ned stood for in his second career as a consultant, teacher, and founder of the Herrmann Institute might be contained in the antithesis: What doesnt the brain have to do with business? Before we address that question, lets consider some remarkable brains of human historySir Isaac Newtons, for example. Scholars say that in the history of science and intellectual inquiry, a brain like Newtons comes along every five hundred years or so. Newtons contemporary and sometime rival, the philosopher Gottfried Leibniz, told the Queen of Prussia that in mathematics there was all previous history, from the beginning of the world, and then there was Newton, and that Newtons was the better half. James Gleick says that Newton computed as most people daydream. Biographers tell us that Newton would sometimes awaken in the morning, begin to get out of bed, and then sit on the edge of the bed for hours, riveted by the thoughts and insights coursing through his Figure 1: Sir Isaac Newton mind. Another brain of note, to which we will turn in later chapters about strategy and decision-making, is that of Alan Turing, one of the pioneers of computer theory. After studying under Albert Einstein at Princeton, Turing was one of the mathematicians who cracked the codes of Enigma, the German secret writing and coding machine during World War II. The Enigma machine could produce

a nearly infinite number of ciphers, which allowed the Germansor so they thoughtto communicate with wireless devices without worry that the Allies could intercept and read their messages. These days, we speak of encryption quite a bit, but in the time of the Second World War, cryptanalysis was an esoteric and mystifying endeavor. Like many people of genius, Turing was an eccentric character. He was arrested in pre-war England for walking down the street with a gas mask onit alleviated his allergies. He was known to run miles and miles to work in old flannels and a vest with an alarm clock tied with binder twine around his waist. One colleague said he was given to long, disturbing silences punctuated by a cackle that wracked the nerves of his closest friends. The work Turing and his associates accomplishedusing mathematics to crack the Enigma deviceswas so vital to the Allies eventual triumph that it was not fully disclosed to the public until the 1970s, decades after the war ended. Then there is the remarkable brain of the nineteenth-century French mathematician Henri Poincar. His work set the stage for many of the profound theories of the twentieth century in applied mathematics, physics, and celestial mechanicsindeed, Poincar sketched out a preliminary version of the special theory of relativity, later fleshed out by Albert Einstein. During a period in which he was working hard on a vexing mathematical problem, circumstances led Poincar to do some travel and to get his mind off of his mathematical work. Following a whim, he decided to board a bus, just for the ride. As Poincar says, I entered an omnibus to go to some place or other. At that moment when I put my foot on the step the idea came to me, without anything in my former thoughts seeming to have paved the way for it, that the transformations I had used to define the Fuchsian functions were identical with non-Euclidean geometry. That is, Poincar experienced a jolt from the blue, a sudden insight and answer to his intellectual questions that seemed to come out of nowhere. We might say that as he boarded the bus, Poincar experienced a riveting Newtonian moment.

Figure 2: Gottfried Leibniz told the Queen of Prussia that in mathematics there was all previous history, from the beginning of the world, and then there was Newton, and that Newtons was the better half.

Do the eccentricities and flashes of insight from these men of genius matter to the rest of us? Yes, if we want to understand and excel at strategic thinking. If you agree with Ned Herrmann that the brain does indeed have something to do with business, strategy, and decision-making, lets turn to the brain itself for a moment, in search of our own flashes of insight.
B R A I N WAV E S

Scientists can tell something about whats going on in your brain with a measurement instrument called the electroencephalogram, or EEG. This device is a medical tool used to measure the electrical activity of the brain, via electrodes attached to the scalp. Using this technology, brain activity has been organized into four categories: Brain activity measured as waves at 13 to 40 cycles per second are called beta waves. This is the most intense activity observed in the human brain and is characteristic of concentrated effort, as when working out a math problem.

A somewhat more restful state, called alpha, is indicated when brain waves are measured at 8 to 13 cycles per second. During a period in alpha state, we are awake, but relaxed in a manner you might think of as effortless alertness. The slowest activity, measured at one half to 4 cycles per seconds, is called delta
Figure 3: The Four Brain States

and is evidence that we are asleep.

This leaves a very interesting state, measured at 4 to 7 cycles per second, called theta. If you have ever felt yourself drifting toward sleep during a dreary business meetingperhaps hallucinating just a bit before catching yourself you have experienced theta. Somewhere between wakefulness and sleep, we experience a sort of reverie that has been a fount of creative thinking since the day the first verse dawned on the first poet. Yes, you may well get your best ideas in the shower, while driving or jogging, or while someone else prattles on about who knows what. The daydream-like theta state seems to be an occasion for the brain to correct and renew itself, to form new connections, leading to visions, new insights, and, well, creative thought. Surely, it was the onset of theta that allowed Henri Poincars mind to generate mathematical insight as he boarded a bus. Aware of the treasures of the intellect just before sleep, artists and intellectuals alike have found ways to tap into their theta state in manners both benign and dangerous. Not so long ago, people like Timothy Leary were touting hallucinogenic drugs as windows into the subconscious. On a healthier track, the artist Salvador Dalihe of the melting clocks and strangely shaped human figuresused to sit in a comfortable armchair holding a serving spoon in his hand. As he would begin to drift through the theta state toward sleep, the spoon would fall to the floor with a
Figure 4: Salvador Dali's Persistence of Memory

clang. Alarmed back to a wakeful state, Dali would immediately grab a pencil or brush and sketch the things he had just seen during his theta state. The mathematician Poincar, reflecting on his own thought processes, such as the epiphany he experienced as he boarded the bus, wrote that creative thinking involves a period of conscious work followed by a period of unconscious work. Once insight is revealed by the unconscious, he said, conscious work is necessary once more to put the finishing touches on an idea, rendering it into a useful concept. The unconscious mind, said Poincar, is not purely automatic; it is capable of discernment; it has tact, delicacy; it knows how to choose, to divine. What do I say? It knows better how to divine than the conscious self, since it succeeds where that has failed. In a word, is not the subliminal self superior to the conscious self? In The Courage to Create, Rollo May concludes that the insights we crave do not simply come to us as a result of careful concentration. Rather, the brain must work and learn, then relax a bit during the theta state so that new connections and realizations can be formed. I have often told students in my Strategic Thinking workshop Figure 5: Henri Poincare's mathematical solution came to him that to build a truly creative work in a flash of sudden and unexpected environment people should wander around aimlessly an hour a day, waiting for the insight theta state to do its magic. This inevitably draws laughter, as in, yeah, like thats gonna happen! But the truth is, its no joking matter. Still, make no mistake. Innovation, insight, and invention do not occur without hard intellectual work. Henri Poincar said that mathematical discoveries, small or great, are never born of spontaneous generation. They always presuppose a soil seeded with preliminary knowledge and well prepared by labour, both conscious and subconscious.

THE GEOGRAPHY OF THE BRAIN

Most of what we know about the human brain we have learned in the past handful of decades. In the 1960s, Dr. Roger Sperry showed through his physiological research that the left and right hemispheres of the brain perform distinct and specialized functions. Today, Dr. Sperrys insights have become common knowledge. It is not at all unusual to see an advertising campaign (theres that word again!) [campaign is defined in chapter 1] showing how our right brain feels about an intoxicating new product, and how our left brain truly appreciates the logic associated with the choice of that same product. In his 2003 book, Looking for Spinoza, the respected neurologist Antonio Damasio shows that normal decision-making uses two complementary paths through the brain. In Path A, we conjure up relevant aspects of a situation, options for action, and logical thinking about possible outcomes. In this manner, we use our rational faculties to come to reasoned conclusions. Path B runs parallel with Path A and involves our emotional and visceral reactions to a situation. On this path, prior emotional experiences to a situation are activated and, in a fashion, relived or re-experienced. Often, the gut reactions arising from these emotions lead directly to the decisions we make, whether or not they are consistent with the rational conclusions resulting from Path A. Damasios conceptualization of human thought processes is consistent with our developing understanding of how the whole brain is used to form impressions: the left side of the brain processes information in a logical, sequential, and orderly manner. In tandem, the right side of the brain contributes to perceptions through abstract visioning (in the cerebrum) and emotional reactions (in the limbic system.) To fully understand the ways people form and maintain impressions and perceptions, a whole brain approach is necessary. Ned Herrmann has described the brain as consisting of four independent quadrants, each of which is highly specialized. The quadrants derive from the fact that both the cerebral (upper) and the limbic (lower) areas are

Figure 6: Four distinct areas of the physiological brain are represented abstractly as Quadrants A,B,C & D

separated into left and right sides. The limbic system is located generally in the inner or lower area of the brain and includes a number of important structures such as the hypothalamus, hippocampus, amygdala, olfactory bulb, and thalamus. The image at left depicts the four quadrants of the physiological brain, which Herrmann calls A, B, C, and D, as four quadrants of a circle, color-coded for easy reference. Lets return to the electroencephalogram, or EEG machine. Remember, this device is a medical tool used to measure the electrical activity of the brain, via electrodes attached to the scalp. With an EEG, technicians can isolate the location of brain activity related to different types of thinking. For example, show a subject a sad movie, and parts of the right limbic area of the brain will light up with activity as the viewer experiences strong emotion. Have her do some math, and the left cerebral area will fire up.

Figure 7: Depiction of the Herrmann Four-Quadrant Model showing color coding

In Herrmanns model, the left cerebrum is the A quadrant and is color-coded blue. A-quadrant thinking is characterized as logical, analytical, fact based, and

quantitative, as shown in the graphic above. The green B quadrant represents the left limbic area, where brain processing is characterized by a focus on detail, organizing, planning, and sequential thinking. Right brain processing consists of the red C quadrant, the seat of feelings and emotions, and the yellow D quadrant, or the upper right brain, the seat of holistic or big picture thinking.
B R A I N D O M I NA N C E

Ned Herrmann observed that as individuals we tend to have preferred modes of thinking. That is, one individual tends to perceive the world more through an upper left-brain lens, or filter, while another individual tends to view things from a lower right-brain orientation. Using the Herrmann methodology, people can be assessed and assigned a score of a one, two, or three for each of the four quadrants. A 1 indicates a dominant, or preferred, area, a 2 indicates a secondary preference, while a 3 indicates an area of avoidance. My profile? For my four quadrantsA, B, C, and D, respectivelyI am a 2311, indicating a strong preference for seeing the world through a right-brain filter as well as a tendency to avoid details and sequential endeavors, or what I call the tedious. Does this profile cause me problems as I strive to Figure 8: Ned Herrmann keep order in my world? You bet. Does it cause me to think and write about business strategy and to view world history as a fount of valuable metaphor as we make decisions of every sort? Evidently. A useful way to think about brain dominance is to consider your handedness. You probably did not decide to be right or left handed; you just prefer one hand or the other. You were born that way, and we can say that your handedness is innate. Still, you can use your off-hand, just as we right-brain-dominant folks can call on our left brain to process information when we so desire. Nonetheless,

people are generally predisposed to a certain style of perceiving and interacting with the world at a very young age. For this reason, it is generally best to help people discover their preferences and recognize their weaknesses. It is much easier and more natural to leverage our strengths than to battle our weaknesses. That is, it is better to find areas of work and endeavor that come naturally to you than to force fit yourself into situations in which you will struggle.

Figure 9: Graphic on left shows the typical brain profiles of representative occupations. The graphic on the right shows that males and females tend to vary on the A and C quadrants, but not on the B and D quadrants.

S T R A T E G Y C R E A T I O N A S A W H O L E - B R A I N P RO C E S S

The strategist is one who is concerned about the future of his or her personal, family, or organizational life and spends time considering possible directions upon which to set forth. We are all strategists. Strategy is, simply a plan that precedes action; it is the chosen direction, or set of directions, we follow in our quest toward the fulfillment of our larger mission or purpose.

Strategic thinking, on the other hand, is a particular mode of thought that keeps us engaged in understanding aspects of our environment that may affect our efforts to follow the chosen direction. To formulate strategy, the strategist must engage the right cerebral D quadrant, but formulation alone is insufficient. Conceiving strategy and bringing it to fruition is a whole brain process. In the movie Working Girl, Tess, the lead character played by Melanie Griffith, comes up with a creative idea for how to accomplish a corporate merger, but as a mere working girl she is not in a position to get her idea heard. Katherine, the villainess of the story played by Sigourney Weaver, does have a position of influence and puts Tesss idea forth as her own. In the pivotal scene of the movie, Tess gains access to the company CEO (through Harrison Fords kind assistance) and tells him how she conceived of the idea: she was reading a gossip column in a tabloid newspaper, turned to the business pages, and saw a connection of ideas that she realized would apply to the strategic situation confronting the company. When confronted, Katherine cannot account for how the solution occurred to her. She has no epiphanal moment to share. She cannot point to any preparation of mind or any trigger or stimulus that would plausibly lead to the conception of an idea. The lack of a trail of thoughts proves that the idea was not hers. The wise CEO recognizes this, gives Tess a desirable job, and bumps Katherine out of the company as the movie moves to a satisfying Hollywood ending. That ending is believable because the notion of a trail of thoughts as a prerequisite for an ideaa period of preparation followed by a burst of inspirationis consistent with the way people replace old thinking with new. Strategy-making begins with an idea, and yet many articles and books about strategy do not address the question of how to generate ideas. The typical tome provides a new way of analyzing and understanding the strategic situation without showing ways to conceive of new and profitable directions to take. An old Steve Martin gag comes to mind. You say to me, Steve, how can I be a millionaire and not pay taxes? . . . Its simple, first, get a million dollars. Unfortunately, the little step at the beginning can be the hardest part. To understand just how to derive ideas for solutions to strategic problems, lets look at the creative process itself. The graphic below depicts Ned Herrmanns steps in the process of idea generation. These steps illustrate the variety of thinking modes necessary to generate and nurture useful ideas. Once interest in a problem is established, preparation is by and large a left-brain, analytical thought process. Before the

10

moment of illumination can arrive, though, the brain needs to let go of concentrated effort, engaging the less structured thinking of the right brain in a manner that Herrmann calls incubation. As we have seen, during a relaxed theta brain state, new connections can be formed. Once illumination, such as the flash of insight as experienced by the mathematician Poincar or the working girl Tess, has occurred, the left brain must take over to verify, or evaluate, the efficacy of the idea at hand.
Interest Preparation Incubation Illumination Verification Application

Becoming aware of the problem

Defining the problem

Sensing possibilities

Generating ideas

Selecting the solution

Making the solution happen

Creating strategy, like any important endeavor, involves the whole brain. That is, a variety of thinking styles are engaged in the strategy-making process. But, as with soup ingredients, some modes of thought are more prominent in the mix than others. I use the term strategic thinking to describe the big picture, Dquadrant thinking one uses in considering the strategic situation (SS)the elements of the Strategic Environment (SE) and Strategic Intent (SI). Nonetheless, the making of strategy requires engagement of the other three domains of thought. Using the Herrmann system, we will consider, in turn, all four brain quadrants as they relate to strategy. The following graphic shows how the four processes of strategyformulating, articulating, executing, and evaluatingalign with the four brain quadrants.

11

Following the circle to the right, we can view the process of strategy-making as a sequence of formulating, articulating, executing, and evaluating strategy. Of course, the process is not so sequential, as each part of the process goes on simultaneously, with a variety of thinking loops going on at once. For example, a simple loop of formulating to evaluating and back again is constantly in motion as ideas occur to us and are immediately subjected to our own judgment and evaluation as to worthiness for future execution.

12

This yin and yang of the right and left brain, with ideas popping up in the former and critiqued in the latter, brings to mind the notion of dialectics expounded by the philosopher G.W.F. Hegel: Every condition of thought or of thingsevery idea and every situation in the worldleads irresistibly to its opposite, and then unites with it to form a higher or more complex whole. The notion of dialectics was foreshadowed by Empedocles and embodied in the golden mean of Aristotle, who wrote that the knowledge of opposites is one. The geography of the brain provides a new way of thinking about the old notion of thesis to antithesis to synthesisthat is, right brain to left brain to whole brain. Developing a working strategy for an organization, then, requires a variety of thinking styles, including both right- and left-brain processes. After interviewing a variety of well-known leaders, Warren Bennisperhaps the most eminent student of leadership of our timewrites in On Becoming a Leader that I was struck again and again by the fact that, whatever their occupations, they relied as much on their intuitive and conceptual skills as on their logical and analytical talents. These are whole-brained people, capable of using both sides of their brain (p. 103).

13

FORMULATING STRATEGY CALLS FOR STRATEGIC THINKING

C.K. Prahalad and Gary Hamel have suggested that strategic thinkers do three things: 1. They think about the environment around them. 2. They think about the future. 3. They engage others in doing the same, resulting in a deeply shared, well-tested view of the future. Biographers of Napoleon Bonaparte talk about his ability to size up a situation with a single coup d'oeil, (pronounced koo-DOY), meaning a stroke of the eye or glance. Napoleon was so knowledgeable about his strategic situationthe landscape, the enemy, available technology, similar situations from the pastthat he could understand and respond quickly to ever-changing circumstances. In the first Gulf War, in 1990, Norman Schwarzkopf took advantage of the latest technological advances to obtain real time data on the strategic situation in Figure 10: Napoleon Bonaparte was said to have the coup d'oeil -- an intuitive grasp of the strategic Kuwait and Iraq, which environment enhanced his ability to understand the strategic environment and think strategically. In addition to paying attention to current conditions, the strategic thinker is oriented toward the future. He or she is intent driven, looking at the dynamics of the competitive environment with purposes and desired outcomes in mind. With strategic intent in mind, the strategic thinker also understands that strategy must emanate or diffuse to others. In preparation for the next phase

14

articulation of strategythe strategist initiates conversations, beginning to activate the group mind to refine and craft strategy. Of course, there is debate among experts as to what exactly constitutes strategic thinking. Michael Porter, perhaps the most widely cited expert on organizational strategy, says that strategic thinking rarely occurs spontaneously. As if to prove his point, Porter provides a dry, deliberate, and distinctly unspontaneous methodological approach to the quest for competitive advantage. Other eminent strategy theorists have argued just the oppositethat strategy-making can also be thought of as a creative process, as rich in spontaneity and magic as any other art. After all, even mathematicians like Poincar and Newton held that their most prized insights burst in part from spontaneous thought. Certainly, nothing about the field of strategy is any more formulaic and logical than that of mathematics. Henry Mintzberg argues that organizational strategy is often emergent. That is, we do not arrive step-by-step at the answers to strategic questions as we do at the result of a math equation. Rather, strategy emerges and changes as the strategist observes the world and reflects upon the dynamics of the competitive environment. In articulating his pin-prick model, Evan Dudik suggests that having a single, straightforward strategic plan can be debilitating. He argues that overly specific strategic plans limit an entity to one particular set of attempts and outcomes, which is tantamount to putting all your eggs in one basket. Rather, Dudik suggests, a variety of strategic initiatives should be pursued as a mass of pin-pricks, rather than following one favored strategy, striking in one forceful but clumsy blow. Just as a general might authorize a series of skirmishes to identify weak points in an enemys position, so might the strategist instigate a variety of exploratory actions, monitoring each for signs of a larger opportunity. In this manner, rather than nurturing one big idea, the strategist maintains a portfolio of ideas, each of which has some chance of becoming a strategic breakthrough Abraham Lincoln recognized the importance of keeping his options open. He said, My policy is to have no policy. I shall not surrender this game leaving any available card un-played. That is to say, Lincoln reserved leeway for events to dictate strategya notion now known as emergent strategy (Sandburg, The War Years, p. 200). The ability to keep options open, to avoid locking in on a particular approach, is influenced by ones brain dominance and other forces of personality. Confronted with an important strategic decision during the 1998 NFL player draft, the San Diego Chargers employed Jonathan Niednagel for his

15

psychological insight. That year, the Chargers owned the right to choose any player on the board from the pool of players leaving the college ranks. The top two players that year were Peyton Manning of the University of Tennessee and Ryan Leaf of the University of Oregon. Using a personality instrument known as the Myers Briggs Type Indicator (MBTI), Niednagel found that Manning had what is called an ESTP profile, while Leaf was an ESTJ. The difference between the two men, according to the MBTI, boiled down to P versus J. In Myers Briggs parlance this is Perceiving versus Judging, or what wed more commonly call spontaneity and flexibility as opposed to structure. With this information in hand, Niednagel offered a strong and unwavering prediction. While there was not much difference between the two quarterbacks in terms of physical ability, Manning would be far more suited to the NFL game. Mannings proclivity toward the perceiving (P) end of a Figure 12: Peyton Manning possesses the coup psychological continuum meant d'oeil, as measured by the Myers-Briggs Type that he would be able to scan Indicator the football field for fast developing options and make appropriate snap judgments. He possessed the glance, the coup d'oeil. Niednagel predicted that Leaf, on the other hand, would be shackled by his judging (J) personality profile. He could be expected to lock in on a particular receiver downfield and would not be able to perceive the other options available to him as each football play developed. Manning was selected first overall in the 1998 NFL Draft. Ryan Leaf was the second pick that year, going to the San Diego Chargers, who ignored Niednagels warnings. Subsequent events validated Niednagels analysis. Peyton Manning, of course, went on to a Hall-of-Fame-caliber career in the NFL. Ryan Leaf struggled through a brief and unsuccessful career as an NFL quarterback. The story of the two quarterbacks illustrates the extent to which thinking style affects the ability to make quick tactical decisions on the field and serves as a fitting analogy to long-term, strategic decision-making. Locking in on options following through on specific, carefully orchestrated strategic planscan indeed limit a strategist in pursuit of long-term mission and desired outcomes.

16

Strategic thinking, then, is characterized by openness to new and different ideas. And one way to generate new and different perspectives on strategic situations is through the use of metaphor, or its close relative analogy, perhaps the most advanced form of human thinking. As Aristotle said in Poetics, the greatest thing by far is to be a master of metaphor. It is a sign of genius, since a good metaphor implies an intuitive perception of the similarity in dissimilars. In their Harvard Business Review article entitled How Strategists Really Think, Giovanni Gavetti and Jan W. Rivkin show that reasoning by analogy plays a major role in the thinking of successful strategists. As an example, these writers point to Intel chairman Andy Groves story of how he came up with an important business strategy. Attending a management seminar, Grove heard the story of how fledgling mini-mills in the steel industry began in the 1970s to offer a low-end productinexpensive concrete-reinforcing bars known as rebar. Establishing market share with the low-end products, these steel companies then began to migrate up the hierarchy of products toward the higher-end, more lucrative steel products. U.S. Steel, which had ceded the low-end products to the smaller and seemingly insignificant players, was caught unawares by the companies attacking the market for their core business and lost market share over a number of years. An epiphany struck Andy Grove as he sat in that management seminar, thinking about the steel industry. Using what Gavetti and Rivkin call analogical thinking, Grove saw that Intel was sitting in a similar situation to that of U.S. Steel in the 1970s. Intel had theretofore leaned toward ceding low-end computer chips to niche players, a strategy that, Grove now realized, would put Intel in a dangerous situation. He began to see low-end computers as digital rebar, a metaphorical image that helped him in articulating his strategy to Intel management. If we lose the low end today, Grove said, we could lose the high end tomorrow. As a result of this thinking, and the deliberations that followed, Intel redoubled its efforts to market the low-end Celeron processor for low-end personal computers. The opportunity to engage in metaphorical or analogical thinking exists for any one of us at any time. We all walk around with a vast library of experiences from work, education, hobbiesto draw upon as we engage in strategic thinking. The trick is in becoming more open to seemingly unrelated thoughts and allowing appropriate time for brain processing in the theta mode. To engage in strategic thought, you must think and reflect on the big pictureon the diverse players and forces in your environment. Think about the future. Use

17

your right brain for intuition and wisdom. As Isaac Newton said truth is the offspring of silence and meditation.
A RT I C U L A T I N G S T R A T E G Y C A L L S F O R E M OT I O NA L LY INTELLIGENT THINKING

To establish direction, a strategy must be articulated to others. To become a strategy in action, strategy must emanate from the strategic thinker. This element of strategy-making, often ignored, was reinforced by Prahalad & Hamel in their maxim that the strategist understands the environment and the future, and then spends quality time engaging others in understanding strategy. Communicating, expressing, teaching, articulatingthese actions require a special interpersonal and intrapersonal intelligence that is characteristic of rightlimbic C-quadrant thinking. In Leaders, Warren Bennis and Burt Nanus conclude, Leaders articulate and define what has previously remained implicit or unsaid; then they invent images, metaphors, and models that provide a focus for new attention. By so doing, they consolidate or challenge prevailing wisdom. In short, an essential factor in leadership is the capacity to influence and organize meaning for the members of the organization. Perhaps the ultimate avatar of saying the unsaid and organizing meaning as an act of leadership was Abraham Lincoln, who used his deep understanding of the emotional needs of the American people to graft his vision of the future onto theirs. He developed an accurate sense of the mood of the people though constant, eye-to-eye encounters. As one biographer said, wherever the soldiers were, there would be Lincoln . . . he always had a kind word for [the soldiers]. Frequently telling them his vision of America and how important they were in achieving victory (Phillips). Lincoln, who made countless visits to hospitals and funerals, displayed a remarkable degree of compassion and caring, which in turn inspired loyalty and commitment to his vision. Lincolns deep empathy for the people of America motivated him to agonize over finding just the right words to articulate his vision of the future. Gary Wills points out in Lincoln at Gettysburg: The Words that Remade America that in Lincolns three-minute Gettysburg address, he was able, through a careful choice of words, to reestablish the meaning that Americans attribute to the Constitution.

18

Four score and seven years ago our fathers brought forth on this continent a new nation conceived in liberty and dedicated to the proposition that all men are created equal. This brief introductory sentence encapsulates what we now consider the reason for the American Civil Warfreedom and equality for all people. Gary Wills and other historians tell us, though, that until Lincoln spoke these words, these ideals were not what the war was about. At the time, many believed they were fighting for a way of life, with such issues as the dynamics of the Southern economy also at stake. At the 1864 gathering at Gettysburg, Lincoln knew that he needed to articulate what he believed the nation was fighting for, and he didso effectively that now, Wills says, the Civil War means, to most Americans, what Lincoln wanted it to mean. Drawing on language from the Declaration of Independence about all men being equal, he elevated that notion to a single, supreme proposition about which we must all agree. Wills says that by accepting the Gettysburg Address, its concept of a single people dedicated to a proposition, we have been changed. Because of it, we live in a different America. Lincolns ability to resonate with the peopleto empathize and inspireis evidence that genius takes many forms. Isaac Newton, in sharp contrast to Abraham Lincoln, offers ample evidence that people with high IQ do not necessarily possess a high aptitude for empathy or even selfawareness. Despite his vaunted brainor perhaps because of itNewton evidently missed out on much of the joy and pleasure of life. He never married or became emotionally close to another person. Despite living for 84 years on the small island and country of England, curiosity never moved him to travel to the sea to observe with his
Figure 13: Lincolns ability to resonate with the peopleto empathize and inspireis evidence that genius takes many forms.

own eyes the way the tides moved in accordance with his theories of mass and motion. Throughout much of his life, moreover, Newton was little interested in sharing or publishing the fruits of his thinking and investigation. He kept many of his findings secret. Eventually, Newton did publish his Principia Mathematica, which introduced The Calculus and changed the field of mathematics forever.

19

It is apparent, though, that he was motivated to do so more by the desire to mark his place in intellectual history than to contribute to the good of humanity. Two men of geniusAbraham Lincoln and Isaac Newtonso profoundly different, each from the other. We may ask, how are we to understand the differences between their two ways of thinking and perhaps put both to use?

In 1995, Daniel Goleman published a book called Emotional Intelligence, drawing considerable attention to a mode of intelligence far different from the cognitive, calculating intelligence of Isaac Newton. Goleman gives us a language to talk about the strengths and weaknesses of people like Newton and Lincoln. Evidently, Newton had a high IQ but, unlike Lincoln, a low EQ, or Emotional Intelligence Quotient. In a nutshell, people with a high EQ display two primary traits: first, they are aware and in control of their own emotional worlds; second, they are empathic and concerned about the feelings and emotions of others. In a seminal work called Frames of Mind: The Theory of Multiple Intelligences, Howard Gardner delineates a variety of forms of intelligence not measured by a typical IQ test. Relevant here are two forms of intelligence that he called the personal intelligencesthe inward-facing intrapersonal intelligence and the outward perspective of interpersonal intelligence.. Gardner defines intrapersonal intelligence as access to ones own feeling life ones range of affects or emotions: the capacity instantly to effect discriminations among these feelings and, eventually, to label them, to enmesh them in symbolic codes, to draw upon them as a means of understanding and guiding ones behavior. Interpersonal intelligence, by contrast, is the ability to notice and make distinctions among other individuals and, in particular, among

20

their moods, temperaments, motivations, and intentions. In a nutshell, interpersonal intelligence concerns empathy and social skill, whereas intrapersonal intelligence concerns self-awareness, self-regulation, and motivation. These two domains of the intellect line up nicely with Golemans notion of EQ. The following tables, drawn from Golemans work, explicate the qualities of each of these forms of intelligence.

Interpersonal Intelligence

Definition

Hallmarks
Expertise in building and retaining talent Cross-cultural sensitivity Service to clients and customers

The ability to understand the emotional makeup of other people.

Empathy

Skill in treating people according to their emotional reactions.

Social Skill

Proficiency in managing relationships and building networks. An ability to find common ground and build rapport.

Effectiveness in leading change Persuasiveness Expertise in building and leading teams

Intrapersonal Intelligence

Definition
The ability to recognize and understand your moods, emotions, and drives, as well as their effect on others. The ability to control or redirect disruptive impulses and moods. The propensity to suspend judgmentto think before acting. A passion to work for reasons that go beyond money or status. A propensity to pursue goals with energy and persistence.

Hallmarks
Self-confidence Realistic self-assessment Self-deprecating sense of humor Trustworthiness and integrity Comfort with ambiguity Openness to change Strong drive to achieve Optimism, even in the face of failure Organizational commitment

Self Awareness

Self Regulation

Motivation

21

As Ned Herrmanns frustrated associate might have said, what the hell does emotional intelligence have to do with business? Does it really matter? A number of research efforts in recent years have pointed to the importance of understanding emotional intelligence in the business or organizational environment. A recent review article by Cary Cherness of Rutgers University provides nineteen case studies that show how emotional intelligence contributes to the bottom line in work situations. For example: The US Air Force found they were three times more likely to select successful recruiters when senior officers use EQ as a screening and selection tool for hiring. A study of 300 top-level executives from 15 global companies showed that EQ accurately differentiates outstanding from average performers. A competency study involving 200 companies showed that cognitive ability and technical skill accounted for one third of the difference between mediocre and high performers, whereas emotional competence accounted for the other two thirds. The Center for Creative Leadership has found that the primary causes of career derailment among executives are related to EQ. There are myriad ways that a strategist might call on emotionally intelligent thinking for positive effect. An accurate understanding of our own emotional state is helpful in avoiding several traps in decision-making, including snap decisions based on short-term emotional reactions to events. Since strategic decision-making is often a group process, a strategist must also be able to gauge the emotions of others. We will deal with several impediments to effective group decision-making in chapter X.

E X E C U T I N G S T R A T E G Y C A L L S F O R D E TA I L A N D S E Q U E N T I A L THINKING

It is tempting to assume that Herrmanns B quadrant (color-coded in his model as green) is not related to thinking about strategy and its formulation. After all, the limbic left brain is the seat of sequential thinking and detail, a far cry from the big picture thinking we associate with strategy. Such an

22

assumption, though, limits our ability to craft strategy. Indeed, any important endeavor requires a truly whole-brain approach. Consider the art of Michelangelo. To create the famous ceiling of the Sistine Chapel, Michelangelo had to call on right-brain processing to develop his grand vision. But he also had to execute his vision. That is, Michelangelo had to tap into his left-brain capacity for detail in order to finish his work of art. I imagine that there were days of tedium as he persisted in bringing his vision to life. In the same manner, conceiving, articulating, and following through on a grand strategy requires the use of our whole brains, including B-quadrant thinking.

Figure 14: Michelangelo needed to call on his "whole-brain" to accomplish his vision at the Sistene Chapel

Larry Bossidy, the veteran chairman of Honeywell and CEO of Allied Signal, was struck that among the shelves of business books published each year on strategy and leadership none focused on the subject that obsesses successful executives: the essential grunt work of delivering results. Execution, Bossidy said, is "the missing link between aspirations and results. It is a systematic process of rigorously discussing hows and whats, questioning, tenaciously following through, and ensuring accountability. Great and significant deeds are accomplished only through the mastery of a vast sea of detail. As a strategist, one must identify the most important details in a given operation and make sure that these details are well monitored and managed. In his press briefing after the Gulf War of 1990-1991, Norman Schwarzkopf praised the thousands of individuals who had managed his logistical operation. In the largest military logistics operation in history, America moved 550,000 troops to the Middle East in a short period of weeks

23

and months; seven million tons of supplies were shipped; 122 million meals were served; 32,000 tons of mail were delivered. By definition, a strategist keeps his or her eyes on the big picture, not the details. Nonetheless, an effective strategist must understand the necessity of detail-oriented, sequential thinking in executing the strategy. Here are some things a strategist can do to hone B-quadrant abilities and bridge the gap between vision and result: 1. Identify which details are critical to the execution of your strategy. Manage and monitor these details. 2. Identify the people who can manage these details and delegate appropriately. 3. Understand the basics of project management. The distinction between laying out a strategy and getting it done is often cited as the difference between leaders and managers. While the leader, like Abraham Lincoln, is one who determines the right thing to do, the manager is one who makes sure the organization does things right. As Warren Bennis says, The difference may be summarized as activities of vision and judgment effectiveness versus efficiencydirection versus routine.

E VA L UA T I N G S T R A T E G Y C A L L S F O R S Y S T E M S T H I N K I N G

There is no such thing as failure; there is only feedback. One of the Laws of Neurolinguistic Programming Explicating his view of strategy as an emergent process, Evan Dudik puts forth the notion of the strategist as experimenter. Following his pinprick model, we launch a number of strategic initiatives as would an experimentertry something, watch for results, adjust, and try again. In classic experimental design, the experimenter generates a hypothesis about cause and effect and then puts the hypothesis to test. Clayton Christensen calls the hypothesis about a cause and effect relationship a theory. He says that building a useful theory involves three steps:

24

1. Carefully observe, describe, and measure phenomena. 2. Group observations into distinct categories, distinguished by recognizable attributes. 3. Develop a theory that explains how a certain set of attributes leads to a certain resultthat is, articulate a theory of cause and effect. For the strategist, a useful theory provides a way of understanding the dynamics of the complex strategic environment, recognizable indicators or warning signals of change, and agreed-upon means of dealing with change. In his influential book The Fifth Discipline, Peter Senge refers to hypotheses about cause and effect as mental models. To Senge, mental models are deeply ingrained assumptions, generalizations, or even pictures and images that influence how we understand the world and how we take action (Senge 1990: 8). Mental models are useful and, indeed, unavoidable. By nature, we form beliefs about cause and effect. One person may form a mental model that says people are best moved toward excellent work by the promise of monetary rewards. Someone else may hold to the mental model that the best determinant of good and diligent work is the intrinsic satisfaction of the effort itself. Both of these mental models can be stated in cause and effect terms. A good mental model is disconfirmable. That is, we can put models and hypotheses to the test through experimentation or simply through continued observation of events and results. To put theories or mental models to work, we use an approach referred to as systems thinking. While strategic thinking involves consideration of the big picture, systems thinking begins when we consider a real-world phenomenon and seek to understand the cause and effect relationships characteristic of a system. A systems thinker wonders how an organization works, looking at the parts as dynamic aspects of the whole. It is the interrelationships of the elements of an organization that interests the systems thinker. While D-quadrant (big picture) thinking, as we have seen, is critical to determining the direction to take toward the future, wed have no means of judging the efficacy of one possible strategy over another without A-quadrant (logical, analytical, fact-based, and quantitative) thinkingwhich is to say, systems thinking. To formulate a workable strategy, the strategist must understand the connections among the constituent parts of the system, must

25

understand how internal organizational capabilities dovetail with the dynamics of the external environment. Once a theory of cause and effect is established, then, the strategist learns to observe and utilize feedback from the environment. Feedback is a term that grew out of systems theory, also known as cybernetics, which emerged in the 1940s and 1950s. The practice of systems thinking starts with understanding a simple concept called "feedback" that shows how actions can reinforce or counteract (balance) each other. Ultimately, systems thinking simplifies life by helping us to see the deeper patterns lying behind the events and the details. [check reference]

Though a mental modela hypothesis about cause and effectprovides a useful way of understanding the dynamics and working of the world around us, blind adherence to entrenched models can be dangerous. Once we close our eyes to disconfirming evidence, once we fail to see the weaknesses of our assumptions about cause and effect, we have failed as systems thinkers. History, of course, is replete with examples of people adhering stubbornly to old paradigms despite overwhelming evidence that a new way of thinking has become necessary. Mental models become the frames through which we view the world. We attend to what is inside our frame, oblivious sometimes to what occurs outside our frames, which can lead to dangerous blind spots. Frames can be useful insofar as they direct our attention toward the information we seek. But they can also constrict our peripheral vision, keeping us from noticing important information and, perhaps, opportunities. Once liberating, mental models can become shackles. As an illustration of the way in which mental models and frames can get out of hand, consider Donald Schons concept of a generative metaphor. A generative metaphor is an implicit metaphor that can cast a kind of spell on a community. All solutions are understood in terms of the implicit metaphor. Some work cultures, for example, use a sports analogy as their generative metaphor, ubiquitously describing events in sports language and casting solutions as game plans. A generative metaphor like this can be healthy, but it can also restrict creativity and problem-solving, since the team may miss out on ideas and options not endemic to the metaphorical world at hand.

26

At times, an over-used generative metaphor can lead to a group dynamic known as groupthink, which we will consider in Chapter X. When cultural propensities like this become problematic, leaders can stimulate positive organizational change by introducing new and useful generative metaphors as they communicate with others. The new metaphor can provide people with a lens through which to see things anew and lead to positive change in the work atmosphere and business results. Perhaps the most important use of systems thinking in modern organizations is in the pursuit of what Donald Schon, Chris Argyris, Peter Senge, and others have called a learning organization. Schon defines a learning organization as systems capable of bringing about their own continuing transformation. Senge says that learning organizations are organizations where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning to see the whole together.
CHAPTER CONCLUSION

In this chapter, we have explored the mental tools of the strategist. To enable good strategic decision-making, the strategist should: Understand the conditions necessary for creative thinking, including preparation, incubation, illumination and verification (whole brain). Use strategic thinking to understand the strategic environment and formulate strategy (D quadrant). Call on emotionally intelligent thinking in order to articulate and diffuse strategy to others (C quadrant). Attend to sequence and details in order to execute strategy (B quadrant). Use systems thinking in order to evaluate strategy and recognize the need for strategic change (A quadrant). Now lets review a few specifics, in case you yourself have been stuck in a thetalike state of reverie . . . Isaac Newton explained the tides, but never saw the sea. Henri Poincar solved a vexing math problem by not thinking about it. Abraham Lincoln said enough in a three-minute speech to reframe our national character.

27

Isnt the human brain a curious and remarkable instrument? Surely the brain will serve us well as we endeavor to make decisions, be they strategic, operational, or tactical. In the next chapter, we turn to the process of decision itself.

B R A I N Q UA D R A N T E X E M P L A R S

Quadrant A Systems Thinkers

Exemplars Thomas Jefferson, Kurt Lewin (known as the Father of Social Psychology), Michael Porter General Gus Pagonis of the Gulf War, Leon Panetta, former presidential chief of staff Abraham Lincoln, Mahatma Gandhi, Walt Disney, Oprah Winfrey Winston Churchill, Bill Gates, Steve Jobs

B Logisticians and Administrators

C Empathic Leaders

D Strategic Thinkers

28