Improving Your Flysight

Have you ever tried to catch a fly? No matter how you approach the wily creature from behind, the side, in front, above - it invariably spots you coming and speeds away. The reason: multi-ocular vision. The fly's visual system gives it a comprehensive and sensitive view of its surroundings to provide ample warning of impending danger.

In turbulent times, organizations and their managers need to develop fields of vision that are equally perceptive. They need to develop competencies that enable them to detect at an early stage the often subtle changes that are reshaping the contexts in which they operate, and to cope with emerging threats and opportunities in a timely fashion.

Spotting "Fracture Lines"

There is, however, a way to cut through this complexity in a way that enables you to act rather than passively react in the face of actual or impending change in your operating environment. Drawing an analogy from the science of seismology, I call it fracture analysis. Just as scientists look for faults beneath the surface of the earth in an effort to predict earthquakes, fracture analysis enables you to scan your environments for emerging fractures that have the power to transform the ground upon which your business or organization stands. It enables you, like the humble fly, to spot the "life threatening" changes taking place around you before they catch you unawares.

Some fracture lines are obvious. A dramatic shift in the price of oil or some other key commodity, a Bhopal or Chernobyl, can seal the fate or transform the development of whole industries. But other fracture lines are harder to see; the full extent of their significance for your business unfolds quietly over a long period of time, subtle but no less powerful. Take, for example, the case of Just in Time (JIT) management. Originally introduced as a method of cutting inventories and overheads, JIT is altering the very fabric of the businesses and industries that adopt its principles. As a technology, JIT requires and encourages profound shifts in how we think about our organization, corporate culture, and managerial style, and in my opinion will over time transform the economics of industrial location. It will ultimately lead to the breakup of centralized mass manufacturing systems such as the concentration of automobile production in Detroit, in favor of widely dispersed multi-product plants located close to the markets they are intended to serve. There are dramatic implications here for policy makers within the industries and services attempting to implement JIT, and for government and other agencies responsible for industrial and economic development.

Just as JIT is going to reshape its users, other emerging fracture lines ranging from electronic banking, cellular phones, environmental pollution, and junk mail, to name just a few, are going to reshape the future of financial services, telephone companies, the chemical industry, agriculture, and numerous other organizations.

By systematically identifying and probing the implications of emerging "fractures," an organization can do much to anticipate and deal with major challenges before they occur.

Managing from the "Outside-In"

The analogy is a crude one, but it does capture the dilemma currently facing many businesses. Try as they might, organizational decision makers find themselves unable to understand and meet the wider environment on its own terms. To do this - to meet the challenges of a turbulent world - they must learn to break through the constraints of internal perspectives and try to understand the demands facing their organization from the "outside-in." They have to find ways of engaging the environment in a more holistic and free-flowing way.

Fracture analysis provides one way of doing this, especially when used to assist a wide range of managers understand and grapple with emerging challenges. By using fracture analysis within the context of management development and strategic planning programs, organizations become more dynamic and vital, more open to change. All too often, interest in the big environmental challenges is confined to top management or the strategic planning group. As a result, a gulf develops between them and the rest of the organization, making it extremely diffic uild the kind of corporate culture where people relish and rise to the challenge of change. By shifting to an "outside-in" perspective, organizations can better - and more regularly - position themselves for the turbulence that lies ahead.

Involve People Outside the Organization

Similarly, much can be learned through "competitor planning." Try creating a task force within your organization designed to wear the shoes and spectacles of a key competitor. Mandate the task force to come up with a plan that will give your competitor an important edge. This exercise, which should be on-going, will help your managers truly see your organization from the "outside-in." Equally important, this new perspective will provide you with key ideas and insights about how to maintain and develop your own competitive position.

The ability to practice "outside-in" management, and to deal with emerging "fractures" is crucial for managerial competence in a turbulent world. Improve these skills and improve your effectiveness in dealing with the challenges that lie ahead.

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