Can strategy be reframed so that companies can thrive in the face of our current and future challenges?
In 50 years of researching companies both in the U.S. and in Japan, the authors’ view of the organisation has evolved from an information processing machine to a living organism continually creating new knowledge.
Advances in neuroscience research in recent years have shed light on the biological factors driving humans’ sense of purpose. We now know that the most basic need we are compelled to meet is social connection.
Neuroscientists have also found that the human brain exhibits a predisposition to seek the common good. As human beings we share the ability to rapidly adapt to changing circumstances, and we can imagine together how we might create a better world.
Considering these findings, the question is: “How should companies use both souls and brains so that strategy becomes relevant to the world we live in?”
Here are six recommended practices that may help you infuse strategy with soul. An ancient Japanese tradition says that doing the ordinary things in life a little bit better every day elevates individuals. In the same way, doing the ordinary things a little bit better every day in our jobs such as working hard, making ethical choices, being kind, practising self-reflection and self-discipline, being humble and being thankful, elevates our work lives.
This builds culture at the organisational level and character at the personal level. These behaviours have to be practised every day so that they become a way of life. Similarly, as we have learned over decades of studying organisations, companies can adopt six daily practices to turn this strategy into a way of life:
- Cope with complexity.
- Adapt to change.
- Embrace dynamic duality.
- Empathise with everyone.
- Tell stories.
- Live with nature.
This set of practices helps organisations connect to the goal of building better lives and futures for company stakeholders, members of society and employees, and helps define and pursue business goals that support the common good.
COPE WITH COMPLEXITY
The growing complexity of our world and its many interrelated systems is widely acknowledged. To solve our most pressing problems, we must tap into diverse perspectives and sources of expertise across multiple domains because no single approach or field of study will provide the answers.
Likewise, we must bring all of our own diverse capabilities to bear: The ability to sit with a complex problem and use both analytical and intuitive thinking to address it is increasingly crucial to organisations.
ADAPT TO CHANGE
The rapid rate of change of the modern world, driven largely by accelerated technological progress, demands that leaders and organisations anticipate and adapt to new circumstances at a pace unprecedented in human history.
EMBRACE DYNAMIC DUALITY
In the West, an intellectual tradition of dualistic thinking (drawing sharp distinctions between mind and body, self and other, humanity and nature) has led business executives to neatly divide knowledge into two categories: explicit knowledge, which can easily be articulated and shared, and tacit knowledge, which is more intuitive and gained from lived experience.
They often value the former more highly than the latter. In contrast, the intellectual tradition in Japan has stressed oneness of body and mind, of self and other, of humanity and nature. Tacit and explicit knowledge form a dynamic duality interacting with, and interchanging into, each other to create something new through life experiences.
EMPATHISE WITH EVERYONE
Human survival has always depended on our ability to organise in mutually supportive groups for food and protection, which is why social connection is our top priority. At the root of connecting with others is empathising with them. Facing today’s crises, political and business leaders should unite, using this unique quality that we humans have.
To empathise on a deep level, we need to develop a keen understanding of others’ perspectives and cultivate compassion in our hearts.
Effective business leaders understand the power of using stories to communicate the essence of their beliefs and ideals and to help the organisation internalise strategy.
LIVE WITH NATURE
Complex natural systems such as the Earth’s climate predate humans by more than 3 billion years, and we have been living with them since our species first appeared.
The Japanese tradition of “oneness of humanity and nature”, also practised by many indigenous cultures around the world, has taken on new relevance as humankind seeks to repair the damage to our natural environment caused by industrialisation.
SURVIVING THE FUTURE
These six practices must become a way of life for companies to survive in this day and age of “unknown unknowns.” They must also become the modus operandi in the life of a strategist who seeks to meet the unprecedented challenges facing businesses and humankind. Observing leaders who consistently do these things has taught us the following lessons about strategy. First, strategy must be driven by human beings.
Strategy is as fundamental as thinking good thoughts, doing the right thing, and practising self-reflection and self-discipline in everyday life. Those six practices represent the authors’ philosophy of doing business: work with soul. Customers, employees, suppliers, communities, and shareholders want to know whether you have a soul, if you want to build mutual trust and connection.
Second, strategy is driven by wisdom and it is about future-making. The future is hazy and unpredictable, which is why leaders need to tell stories about where they are headed, it allows others in the organisation to follow.
Narratives illustrate a set of beliefs about what the company stands for and what kind of legacy it wants to leave behind for future generations. These stories bind the organisation together and help strategy become a way of life for all employees.