The first principle is that people are expected to work together so effectively that they can make decisions closer to the source of the relevant action. We don’t make fewer decisions (we might make more), but we make them where they need to be made. This means that we move the locus of control. We don’t approach the world with the notion of “that’s above (or below) my pay grade.” Similarly, we as execs must not dismiss an activity as beneath us if it is important to the business, because that models the wrong behavior. Instead, roll up your sleeves and set an example.

Strategy creation can happen anywhere in the organization where the talents, information, and wisdom exist to address a particular need. Whenever a decision is needed, the issue is not immediately escalated to the top. Instead, the team reaches out locally until it finds what it needs to make that decision.

Ellen’s story (scrubbed of identifying information) in the sidebar "Hey, Wait...Do We Do That?" on page 216 shows how having a process for shaping strategies on the fly makes a company more responsive to the marketplace. The events in that story took place in 2008, and represented a shift in approach for a company aiming to win new markets.

If Ellen’s company had adhered to a traditional strategy creation model, Ellen’s pursuit of a new market might have taken six months to a year or longer. Her time, and that of her colleagues, would have been spent trying to build consensus and getting approvals rather than inventing on the fly. She would have had to wait for the planning cycle, create a business plan, and get high-level sign-off before taking any definitive action. Some execs might challenge assumptions or data, and others might cleverly take the credit.

Instead, Ellen used her domain knowledge to create a strategy that fit with the clear mission of the business. She had the roadmap on how to think about the situation. This allowed her to test an idea quickly and prove its worth in the marketplace (which is more compelling than survey results or dubious analyst forecasts), making the company more responsive to its customers and therefore more ready to win.

Ellen used a process that allowed her to invent on the fly. She and her team had a set of shared core beliefs—beliefs about her role, what her organization would allow, and what ultimately mattered to her company. These beliefs enabled her to focus on value creation first and approval second. These first principles were the driving force behind her ability to invent. Knowing that her principles were shared with the larger team, Ellen had the permission she needed to innovate, without even asking. It was in the culture.

Stepping back from Ellen’s story, it’s important to note that each company will have their own mix ratio. One firm might have 90% of the decisions approved by the C-Suite, but could be better served by a number like 70%. Another might be at 70% today and benefit by moving to 50%. You and your organization must look at the kinds of decisions you face and consider where they need to be made.

Strategy conversations are creative discussions. We contribute to this creative process by bringing our experience and wisdom, our point of view, to the table. Our point of view is based on our experiences and observations; it may be a keen awareness of something the rest of the group is not thinking about yet. And our strongest points of view are usually the mostly deeply held. That’s all well and good until our strongly held opinion turns out to be in conflict with someone else’s. This tension can pose quite a challenge, but when handled well, it can be very productive.

For effective collaborative strategy, we must embrace tension, engage questions, serve as thinking partners, and abide by the result. In short, we must engage in good followership, and we must insist on it from our teams. Let’s make sure we cover each of the elements.

Companies often set themselves up for failure by saying they want people to co-own success, but then routinely rewarding individual efforts through both recognition and economic payoffs. To get co-ownership, we’ve gotta incentivize co-ownership. Say the company has 15 objectives. Pay 100% at 15, 50% at 12, and 20% at 10. Everyone will support all 15 objectives, not just the one they own more directly.

And it is not OK to have people do their part right without co-owning the success of the company’s end goal. We’ve covered this kind of accountability and personal responsibility in Parts I and II, but it is worth saying again: people participate based on their ability to help build the future together.

Rather than naming an employee of the year, choose a department of the year or initiative of the year. Or make 50% of any person’s success tied to the company’s success. Make sure groups don’t sandbag by recognizing in advance those groups that are taking on aggressive goals.

In short, make sure that incentives line up with what your company values in a collaborative set of goals.

Ever been to a symphony? How about an improv session at a comedy club? The difference between traditional strategy and collaborative strategy is like the difference between these two performances.

At the symphony, the more exactly a performance matches the director’s vision, the more perfect it is. Flawless execution occurs when each talented performer performs precisely as practiced under the meticulous attention of the maestro. Rehearsal is essential and virtuoso skill with the instrument is valued, but deliberate deviation from the score is taboo.

In stark contrast, improv has a very different performance process. The group’s players improvise and play off each other to create the piece, building on what others have created with a “yes, and...” style. The performance is less scripted, and the process of creation is fluid. In improvisational art, collaboration is unique, built on high engagement, and allows individuals to contribute something to the larger whole. Each performance has common themes, but is unique to the situation at hand. In both types of performance art, the players bring their unique talents, but they use different methods to “create” the performance.

Improv relies on a method that requires less formal planning and prep time. It goes faster from concept to execution. But it does require a clear objective or structure so the players can act and respond interestingly. Improv, therefore, is akin to collaborative strategy because it is constantly creative and depends on the process of aiming and adjusting (Figure 8-2). Collaborative strategy lets you aim toward a business outcome and then move forward without having to step out of the scene to check in with others for specific direction.

Figure 8-2. The relationship between strategy and improv

Consider for a moment what might happen to these two performances if something were to go wrong—someone falls down, for example. How would each performance be affected by something it didn’t anticipate? The orchestra would struggle to gloss over it, fumbling and straining as best they could, looking for direction from the maestro. The improv players, on the other hand, would roll with it, incorporating it into the story to add new layers to their performance.

Like improv, every strategy creation effort is brand new. We can’t rehearse it. Effective strategy creation must be adjusted in real time to the events in our world. Aiming and adjusting requires being watchful of the situation, and revisiting ideas, assumptions, and plans in an ongoing fashion as a matter of practice. Of course, it’s not pure improv. The destination is a guideline in improv, but an essential shared target in strategy creation. Without that clear latitude/longitude direction, what follows is chaos.

Making learning a core competency can be a strategic advantage. As the Rumi poem aptly states, “It’s in the rub that the stone gets polished.” We need to spend more time polishing our stones—interacting with one another as we solve problems. Many corporate cultures seem to value “getting along.” I believe that worldview comes at a high price. I believe that it’s when we address our disagreements that we find the insight we need. It rests on certain philosophical assumptions, best practices, roles and responsibilities, and methods for getting stuff done and making things happen. Let’s explore them.