Strategic Thinking for Entrepreneurs

What is it?

The literature on strategic thinking is vast. It makes interesting reading, but for now use a Wharton Business School definition as your guide:

"Strategic thinking focuses on finding and developing unique opportunities to create value by enabling a provocative and creative dialogue among people who can affect a company’s direction."

This is an especially important message for the entrepreneur.

Using all the faculties

For a 'provocative and creative dialogue', remember that this is not an academic exercise for you. You need to make use of all your faculties. For successful strategic thinking each one has a role:

• Sensing: uses stimuli from outside or inside the body—hearing, sight, smell, touch, taste, and equilibrium. Sensing people are likely to focus on facts, details, experience and the present.
• Thinking: involves the mental manipulation of information, as when we form concepts, engage in problem solving, reason and make decisions. Thinking people have a preference for determining the objective truth in a situation.
• Intuition: uses unconscious understanding. Intuitive people tend to be concerned with what is possible and new, with an orientation to the future.
• Feeling: uses emotion and sensitivity. Feeling people are concerned with personal values and making decisions based on what is the best for the people involved¹.

Using all the 'smarts'

You have probably heard the term 'emotional intelligence' as a result of the book of that name by Daniel Goleman. He is the man who has long argued that outstanding leadership requires a combination of self-mastery and social intelligence. Then there's Howard Gardner's Frames of Mind: The Theory of Multiple Intelligences, a book that helps to explain how and why different people seem to learn in different ways and possess different skills and talents. In using all the smarts in strategic thinking, you are much more likely to cover all the bases.

The 'smarts' that Gardner defines are:

• word smart
• number/reasoning smart
• picture smart
• body smart
• music smart
• people smart
• self smart.

Trusting first impressions...

Malcolm Gladwell in Blink, makes the argument that people frequently make some of their best decisions in mere seconds. It is our adaptive unconscious at work. We can toggle back and forth between thinking and intuiting. And as Gladwell says, "decisions made very quickly can be every bit as good as decisions made cautiously and deliberately."

...Or not?

Take a look at the image of the tables. What do you see? Your gut feel probably tells you that the one on the right is square and the one on the left is rectangular. Anyway, you guess that the dimensions are different. Right? No, wrong. They are identical (2x1). Your intuition gave you the wrong answer. The depth illusion drawing Turning the Tables^© is from Roger Shepard's book, Mind Sights. Most of us trust our intuition more than the evidence suggests that we should.

The way the brain creates perceptions from raw data is a frequent characteristic of entrepreneurs. they can see what is not obvious to many others. The ability to perceive things differently is a skill you can hone. Does the illustration (a Kanizsa triangle) on the left say three pacmen or a floating triangle? Probably the triangle because that is what you want to see, based on your experience.

When I was a young man in management, I learned that strategic thinking was all about using data. As I have aged, I have learned a new truth: that while data is necessary, it is not sufficient. We have to use our right brains for intuition, and pattern sensing probably even more. Entrepreneurs have a way of seeing what others cannot and thus are often game changers or mould breakers.

Using what I learned in military intelligence...

Good strategic thinking takes into account that our thinking is going to be partly based on inaccurate information and/or conclusions, and treats any conclusions as tentative or hypotheses. When I was in basic training in the intelligence service, we were drilled in comparing and contrasting. We had to evaluate the reliability of information sources—the context, as well as correlating that information with other information collected. We had to examine assumptions, and be critical about our beliefs. Below is a simplified version of the kind of grid that we used. When you set out the information graphically in this way, it is easier to see the 'wood for the trees'.

...to see what is going on around you: insight and foresight,

Successful strategic thinkers have an external focus, keep gathering intelligence and are prepared to modify their strategy in the light of the emerging patterns they observe in the chaos around them. Watch for disruption and watch for convergence.

Irene Saunders, the author of Strategic Thinking and the New Science (a book that aims to apply chaos and complexity theory to business strategy), says it well when she breaks down the strategic thinking process into two components:

• insight about the present;
• foresight about the future.

To have a vision of how things may turn out, you need to have some idea about how they are at present. Since everything chance and we live in a world of impermanence, the strategic thinker has to be open to possibility.

and make sure the strategy is not cast in stone

If you have learned nothing else, you will know as an entrepreneur, that nothing turns out quite as it was intended. Business plans may qualify uncertainty, but they do not tell you that you will succeed. As a lead entrepreneur, your style should be adaptive. You are working in the real world and, just as nature favors adaptability and quick wits, you will need those qualities in bucketloads.

Discontinuity and paradigm change mean that your strategy has to incorporate process as well as goals. Hence the successful strategic thinking entrepreneur is concerned as much about 'how' as 'what'. Do not be shy about writing down and sharing how the business is going to work—at least as a guide to behavior, both for you and your colleagues and collaborators.

Green is good, right... but what is green?

The eco-pragmatist, Stewart Brand, he of the Whole Earth Catalogue, will surprise you and may radically impact your strategic thinking, once you have wathed this 22 minute video of his TED lecture on '4 environmental heresies'.

1. If you want to know more about this, then find out about the Jungian personality types instrument, the Myers Briggs Type Indicator® (MBTI). You may have encountered it on a management development or leadership program during your corporate career.

The purpose of the MBTI personality inventory is to make the theory of psychological types described by C. G. Jung understandable and useful in people’s lives.

The essence of the theory is that much seemingly random variation in the behavior is actually quite orderly and consistent, being due to basic differences in the ways individuals prefer to use their perception and judgment.

The goal of knowing about personality type is to understand and appreciate differences between people. As all 16 types are equal, there is no best type.