There are many tools that can help break away from fixed thinking,
the negative impact of paradigms on new thinking,
the negative effect of group and pre-emptive thinking
abundant in Command and Control negative environments.
The topics below are selected at random as somewhere to start. It could be argued that there is no specific start point and if there were, that in the starting, new directions would present throughout the process; the need to revisit some as a result of others. If the thinking is clean and clear; if Intelligent Disobedience and Emotional Intelligence are being practised as part of ‘culture’, then this will surely be the case! Indeed, if there is no ‘going back and revisiting’, then that could be evidence of a ‘group think’ culture.
These topics, somewhat random, do start with thinking that helps with connection, problem-solving and decision making, leading through strategic thinking tools and the necessary ‘is it viable’!
The comments below are cameos of thought and are not meant to be in and of themselves sufficient to enact a strategic planning session – more hints to think of tools to access. More information is on the https://colourthinking.com.au web site – check out that directory or give me a call – 0407827173.
de Bono’s Six Thinking Hats, Porter’s Generic Strategies, Surveys, Benchmarking, Marketing Mix, Budgeting, Capital Planning and Organic growth and Acquisitive growth.
de Bono’s Six Thinking Hats, a thinking tool designed to assist in decision making, problem-solving & interpersonal connection.
Through the use of categorising predisposed thinking patterns into colours, deBono suggests that individuals habitually refer to their established thinking paradigms in six main focus areas. Through identifying which of these is the main focus personal development can be undertaken to exercise thinking outside of those. Additionally, analysis of other interlocutors across these six ‘colours’ can help know how best to engage with other individuals.
As an example, a ‘white-hat’ thinker, someone analytical, sees things in a black & white pragmatic way, is best approached through that type of behaviour/discussion. So that the ‘yellow-hat’ thinker, very positive, very ‘up’, doesn’t close the ‘white-hat’ person off, if they approach first through ‘white hat’, maybe asking for help or support for a budget that is needed to build a business case for their ‘positive thought’ rather than exploring their idea first with that person will be talking to an open mind.
To make the most out of the tool it is recommended to:
- Fully understand what each colour signifies and conduct a self-audit
- Analyse that and identify any differences to your perception and that of others
- Do the exercise on two others and then talk that result through with them, about their self-perception and yours of them; it is usual to portray different behaviours to different people. This is where the recognition of the need to alter behaviours becomes obvious, if maximum connection is to be achieved.
- Then using de Bono, ‘with the benefit of hindsight’, examine several past experiences with different people and develop new ways of approaching these situations to achieve a heightened response/connection.
The de Bono six thinking hats. – explanations of each
|Style / type behaviour – across the page|
|White Hat thinking This covers facts, figures, information needs and gaps. “I think we need some white hat thinking at this point…means “Let’s hold the arguments and proposals and identify the empirical, the facts, what information we need to support the proposition”|
|Red Hat thinking This covers intuition, feelings and emotions. The red hat allows the thinker to put forward an intuition without any need to justify it. “Putting on my red hat, I think this is a terrible proposal.” Usually feelings and intuition can only be introduced into a discussion if they are supported by logic. The feeling is genuine, the logic could be spurious or just new, different. The red hat gives full permission to a thinker to put forward his or her feelings on the subject at the moment. The search to adjust culture for approval of ‘intelligent disobedience’ lays here.|
|Black Hat Thinking, This is the hat of judgment and caution. It is a most valuable hat. It is not in any sense an inferior or negative hat. The rigour or negative hat. The black hat is used to point out why a suggestion does not fit the facts, the available experience, the system in use, or the policy that is being followed. The black hat must always be logical. The ‘what-if’ hat.|
|Yellow Hat thinking This is the logical positive. Why something will work and why it will offer benefits. It can be used in looking forward to the results of some proposed action but can also be used to find something of value in what has already happened. It encourages a positive view which can then be tempered through other hats.|
|Green Hat Thinking This is the hat of creativity, alternatives, proposals, what is interesting, provocations and changes. New ideas.|
|Blue Hat Thinking This is the overview or process control hat. It looks not at the subject itself but at the ‘thinking’ about the subject. “Putting on my blue hat, I feel we should do some more green hat thinking at this point.” In technical terms, the blue hat is concerned with meta-cognition.|
- Fully understand what each colour signifies and conduct self-audit
- As a second person to audit you and examine any differences
- Maybe a third person, as it is usual to portray different behaviours to different people
- Using de Bono, ‘with the benefit of hindsight’, examine several past experiences with different people and develop a new way of approaching that person to achieve a heightened response/connection.
A tool used to compare something with something else, it can be personal or business, to ascertain the degree of competitive excellence, learning from others successful experiences.
Best practice is where that comparison is made with an established entity’s outcomes that are seen as excellent. Benchmarking can confirm that your results are acceptable as well.
There is potential to not know the opportunity for growth compared to actual unless there is a comparison to another similar situation. Through identifying ‘like-to-like’ against others, it is possible to get that important glimpse of what is possible, where one sits in the order of things. “A competitor of a like product is able to sell at a better price and you cannot compete. Their production per hour is 30% faster, to quality, than yours. Knowing that, attention can be given to the numerous impacts on cost to produce, knowing that another can do so more effectively. Benchmarking against and through ‘Best Practice’ will help give focus. There are many impacts on the cost, cost of materials or labour of overheads. There are many areas of business to benchmark against others actual.
This is a drawback to a too highly focused ‘benchmarking’, leading to believe someone else’s result is the best possible. In this situation, ‘Best Practice’ might be confused for ‘no better practice’. The energy to achieve the benchmark of recognised Best Practice holding back from the potential for even better still. All part of a journey.
Ensure the comparison is factual, same-same. The is very important
Look to special one-off reasons that could impact on the comparison
Do it over more than one period
Porter’s Generic Strategies
Michael Porter talks about generic strategies, low cost, differentiated or focus, segmentation/niche, cost or differentiation. He uses these terms to serve as thinking clues, like a checklist.
Porter does advise to consider the ‘position’ the product or service will serve in the marketplace when considering the market disruption needed to achieve organisational goals. Porter’s strategies are brought together from commonly used thinking but before the digital age; further thinking may be needed to take those changes into account.
Choosing one generic strategy such as low cost alone can lead to a narrow appreciation. If taken in conjunction with market segmentation, and perhaps product differentiation, then various markets can be addressed differently. If the product life cycle is dissimilar in different niches, then different generic strategies and focus can be applied.
These are serious organisational decisions and there needs to care that group and pre-emptive think are not overshadowing new thought, intelligent disobedience helps to increase participation and contribution..
Surveys are a tool to collect information to inform decision making processes. They are prepared in the form of questionnaires or part of interviews and they can collect information via various media including paper-based, electronically, web-based or over the phone. For a survey to be useful, the purpose of it needs to be clear. The target market needs to be recognised for that purpose. It may be collected feedback from current clients or lost prospects. It may be looking into a differentiation strategy outside of the current client target market and establishing criteria to proceed or not.
A survey can also be part of the ‘push and pull’ of marketing. That is, through the asking a question of the prospect, enliven in them a desire for the product. A little like public relations activity, they can enter prospects mind more cleanly than pointed advertising. The survey being the ‘pull’ and the advertising is the ’push’ – “buy-now, limited stock”.
Knowing the purpose can be difficult as it may only become fully apparent as a result of the initial responses to the survey questions. It is important to ‘test-market’ the survey to ensure the most appropriate target and the most appropriate questions.
An example may be where a business is looking to capture more business from the trades element in construction. Whether opening their sales office earlier would capture more inquiries whilst competitors were closed. Trades usually starting work earlier in the day.
|Would it make it easier to order product if we opened our sales office at||7.00am|
|Or if we closed later at||5.30pm|
From these responses a useful and thoughtful trial period cold commence, with suitable guidelines to measure success against any additional costs. The ability to Sort & Search responses is essential,
Surveys should not be relied upon solely. Probability or statistical modelling needs to be engaged, to ensure answers are not skewed to a particular unintended market. Think tanks, focus groups are other forms of ‘surveys’ that can help identify answers to the question AND expose questions not considered.
A well-established, much-accredited way to think about marketing is the use of the 4 p’s, Product, Price, Place and Promotion, different aspects that potentially drop down into more questions to consider. This has even been extended out to 7 by one author, to 28 by colourthinking. The marketing mix, a tool to help identify opportunity to help thinking.
Through establishing a check-list type tool of this type, the development of a marketing strategy is assisted, a way to ensure thinking is complete, all aspects are covered. The ‘p’ for Position needs to be given preference as this will designate where the other thinking fits. Recognising opportunities to differentiate and establish ones raison d’être requires clear and extensive thinking within the designated target market..
Eg If manufacturing a new motor vehicle, one would conduct a positioning matrix to identify the competition versus known demand, across all the criteria, relative to the considered unit. This would cover selling price, physical size, configuration, accessories and much more. Then the manufacturer would commit to a ‘position’ displaying opportunity in the marketplace and decisions would flow from there. The concept of the 28 Ps’ is to help build a complete canvas, a full checklist. Every day the need to break away from habit thinking, becomes more important. More topics to check against means more people, thinking more.
Use each of the 28 to generate thought, differentiation, opportunity. Making the tangible intangible and, the intangible tangible. Lateral thinking is necessary as is the will to answer each of the 28 ‘questions’.In these you WILL find answers that give you differentiation.
|The 28 P’s||Currently application||Opportunity|
Budgeting is about developing a measurable representation needed to achieve a goal, a desired situation so that a strategy to achieve that can be developed. Most often this is monetary, but it can be other measurable factors such as time, human resources or material goods, risks, down-time, anything that can be measured. These things are budgeted as part of the process of developing & managing a plan.
A project will necessarily contain budgets, these will be aligned to the scope of the project. Scope, which includes time, resource and quality, all items that can be budgeted for. Even weather can be budgeted. A project which can be impacted by rain will need to budget for that likely hood, measured against past experience and future trends/forecasts. Without building into the time to complete, (budgeting) the impact of rain, then there is potential to exceed expected delivery date, exceed costs, impact on quality.
As budgets are based in measurement against a determinant, corrective action can be taken if any misfortune occurs, in this case above, unseasonal rain, when there is still time to take countermeasures.
One of the challenges with a budget is recognising the various known and unknown factors that can potentially skew the proper allotment across a time continuum. Budgets are advised to meet SMART criteria.
One of the serious limitations of budgets is tying them to previous results, in the mistaken belief that the ‘marker’ result was the best possible. Many budgets affect the potential of an organisation because they are set either too low or too high without effective strategies to monitor.
Budgets need to be devised with the people responsible, this is the Leadership element of the tool. Trusting the resources and empowering and engaging them in the budgeting exercise will significantly contribute to a more reliable practice. Such trust and respect in place of arbitrary KPI’s are imbedded with ‘Command and Control’ thinking.
The recent Covid pandemic is an example of something unplanned occurring that can put a business under severe financial stress. It could be argued that one can’t budget for this type of thing but, there were pandemics in 2009,1968, 1958, 1930, 1918, there were other real stresses, like pandemics, being the Global Financial Crisis in 2008, a recession in 1990, and 2020 as a result of Covid. The share market crash of 2008 and back in 1929.
The amount of financial capacity freely available to achieve set objectives, in the short, medium and long term. Capital planning is a strategic approach to better planning and managing the physical assets, both existing and planned.
One of the main contributory reasons a business stresses is lack of capital. Tools such Business Planning, cost-benefit analysis, break-even analyse, budgeting are there to help in identifying the capital needed to start and continue through establishment, maybe life cycle etc. All jurisdictions have bodies responsible for the governance of business. There are thresholds and regulations surrounding business financial capacity. The structure of a business, sole trader, company, trust, partnership etc. will have impacts on the amount of capital required.
Capital can come under pressure because of success as well. The need to gear up to meet demand, new machinery, additional stock, more people, success in export, slow payment, changes in laws both here in Australia and the country of receipt, eg Changing import / export rules, quotas etc, locked into contracts and the rate of exchange, all needing careful planning of capital to meet demand.
The building of substantial capital equipment, new plant etc. Capital may refer to funds but could also be about other financial instruments, such as leasing and mortgages. All will usually be needed to be anchored with security of some type.
Organic growth and Acquisitive growth, put simply; organic means growing from within, acquisitive means growing from outside – buying some other organisation.
One is not necessarily better than the other. There are however significant matters to consider. Much like deciding to adopt an ‘export’ led growth against optimising home markets. Much money lost, many companies failed, when they seek to grow before ensuring they have optimised the market they potentially know best, easiest to service geographically, same culture, some financial systems etc.
Organic growth can be as simple as more effective sales management, better budgeting, optimisation of the manufacturing process, pushing into new markets, product development and differentiation – see Porter Generic Strategies and the 28 P’s of Marketing.
Acquisitive growth maybe in vertical integration, buying an entity that is either a supplier or customers of the business or horizontal integration, a competitor.
Neither are necessarily without significant risk. Computer systems are a perennial challenge and can add substantial costs and dislocation to both organisations. The culture of the businesses, the pay scales, the career paths, the actual valuations being relied on to make the numbers work – all these things are problematic.
If the business is looking to spend its capital on buying another business up or down the supply chain and gets it wrong, then the pressure on the capital adequacy can be enormous. Very often the perceived benefits do not come about, but then sometimes they do. Basic tools such as SWOT, Business Case analysis, Strategic and Business Plan review all help. Something like 90% of all projects fail to realise the full potential (or any potential) and growth plans feature in those. If a business has not fully explored organic growth or has and hasn’t been successful, then why should it be thought they would be any better, taking in a new busines and assimilating that?
It is often said that acquisitive growth has the potential for immediate gains, of course it does. It could also be called ‘bought gains’. That is the gains are not a result of the business doing anything but buying sales/markets. Nothing to do with their ability to manage that additional business and maintain their current business at the same time and to be able to financially support any added costs through the acquisition.