How to Add Wisdom to Your Company’s Strategy

“We are drowning in information, while starving for wisdom. The world henceforth will be run by synthesizers, people able to put together the right information at the right time, think critically about it, and make important choices wisely.” – E.O. Wilson, entomologist

leverage, key performance indicatorsIf your company is like most, you set goals then wait to see what happens — as if merely stating the goal will bring it about.

In reality, for goals to make a real difference to your company, you need to pay more attention than that. You must pay attention to what you and your employees will do differently to move an ambitious goal forward. And this often requires infusing some wisdom into the process – wisdom that comes from using data that drives and measures progress toward a goal.

How do you gain the wisdom to get the results you want? You get it from past experience and intentional trial and error now. It is wisdom, rooted in the experimentation of science in the form of “independent variables” and “dependent variables”.

In science, an “independent variable” is a condition or value you change to see what effect it has on something else. That “something else” meant to be impacted is the “dependent variable”.

Think of a science fair and the ubiquitous experiments involving growing plants. Usually, kids varied one of many growing conditions to see what would support or inhibit plant growth. Some of the things they would vary included amounts of sunlight, amount of water, etc. Each condition changed was an “independent variable”. Plant growth is the “dependent variable” because it would depend (hypothetically) on what was done with the chosen independent variable.

A straightforward business example would be a desire to decrease production time for a widget by minimizing manufacturing downtime to while maintaining current quality. Manufacturing downtime is the independent variable and production time is the dependent variable.

Applied to your company goals, independent variables are called Key Performance Indicators (KPI) or “lead measures”. Thus, independent variables are to a hypothesis as KPIs are to strategic goals. They are the key to gaining real wisdom around what will allow your company to successfully achieve its goals.

To gain such wisdom regarding your goals, run the experiment by simply restating your goal in the form of a question to more easily identify relevant KPIs. For example, if the goal is to decrease production time by 10% by December 31, restate it as a question. “How can we decrease production time by 10%, by December 31, without sacrificing quality?” The answers to your business question will point you in the direction of possible KPIs. Then, you can vet further for potential impact and your ability to control them.

Unfortunately, many leaders fall short when it comes to gaining wisdom. They don’t develop and track KPIs in an intentional and deliberate way. Instead, many leave it to chance that employees will make the adjustments needed to get to the company goal. Or if they do identify the KPIs, they don’t work with their teams to design “experiments” to prove or disprove that the KPIs are affecting the goal.

How are you adding wisdom that informs your company’s strategy? Which goals and related KPIs is your team focusing on now? How are you showing a correlation or causation (or lack thereof) between those KPIs and the goal?
WANT TO USE THIS ARTICLE IN YOUR NEWSLETTER, BLOG OR WEBSITE? You can. Simply include this information with it: Beth Strathman works with business leaders who want to increase productivity and retention by shifting their focus from daily tactical work to the strategic work required to move their companies forward. Learn more about her company Firebrand Consulting LLC at: firebrandconsultingllc.com.