it’s unpopular or too hard. Everyone chases the shiny, new, innovative decisions, to the detriment of what the organization does well.
We’re going to give you two examples of publicized situations where strategic leadership was sorely lacking. When you’re at the strategic level, your decisions are very often made on a public stage. When you make a mistake, there can be huge consequences.
Diana at McDonald’s
In the early 2000s, McDonald’s stock tanked. The company had just made several acquisitions of other restaurants that took the organization away from its core business of running a unified, well-loved brand experience. As a result of the acquisitions, McDonald’s had lost focus on what we had previously done so well—that is, we lost focus on the McDonald’s customer.
I was new to the home office at this time. In fact, I had been there a grand total of two weeks. The CEO, Jim Cantalupo, had retired but was brought back to save the company. His first order of business: meet with everybody in the home office who had recently come from the field. He wanted to know what was really going on out there. I nervously shared what I had so recently seen happening in the restaurants: they were dirty, quality had gone down, and we were not listening closely enough to customers. Crew members weren’t even allowed to take orders from customers asking for a different condiment on a signature sandwich.
Cantalupo eventually turned McDonald’s around by shedding the new acquisitions and focusing on what we could do well: listen to customers and provide an experience that would make the restaurants their favorite place to eat and drink. In this case, a strategic, big-picture view meant understanding that the company had gone too big with its strategic direction and reining in the innovation and growth until the core of the business could be strong again.
Whole Foods
Not long after Whole Foods was acquired by Amazon, customers began noticing empty shelves. A lot of empty shelves, actually. Photos of produce sections with only a stray lettuce leaf or onion peel trended on Twitter from customers in some of the largest markets in the U.S. Customers also complained publicly about rotten and rancid products and assumed Amazon was to blame. The problem, as it turned out, began before the Amazon acquisition.
Business Insider acquired a copy of a Whole Foods manual describing order-to-shelf (OTS), an inventory system designed to “help Whole Foods introduce more automation into its inventory management system by streamlining food buying and other store-level decisions.”1 The system appeared to have the opposite effect, along with a crushing impact on employee morale. In the past, store employees could fill holes on shelves with products they knew were strong sellers in their stores, keeping the shopping experience appealing. Under the new system, the manual instructed employees to leave holes empty, helping “ensure that OOS [out-of-stock] items get reordered because the hole is visible.”2 Furthermore, a point system penalized employees for any products that weren’t in the proper shelf position, with the potential for department managers to lose their jobs over too many infractions.
In many of the articles covering this story, employees are unnamed due to fear of being fired. In the past, Whole Foods has won accolades as a top employer due to its strong culture and valuing of even the lowest level employees. The order-to-shelf system is another example of a short-sighted decision from the top that wreaked havoc across the organization. By taking away the autonomy of its store employees, Whole Foods created a public relations disaster for itself. Time and again, we’ve seen examples of leaders who fail to value the employees throughout the organization, and as a result they inevitably see their share prices tumble.
What’s the secret to strategic leadership? It’s the ability to see the big picture and think through decisions in a way that connects to the right actions and gets the right results, taking the company where it needs to go. In spite of change all around, strategic leadership never loses its value.
We wrote this book for the people we consult with, the people we coach, and even for the people who we ourselves were earlier in our careers: leaders who need to do something different to take themselves and their organizations to the next level. You may be a high-potential employee, used to succeeding and performing well. You want to win, you want to lead, and you want to drive real, measurable results in ways that matter. You’re seeing other people around you succeed and be promoted while you stay in the same place. What’s the difference between them and you?
What’s the secret to strategic leadership? It’s the ability to see the big picture and think through decisions in a way that connects to the right actions and gets the right results, taking the company where it needs to go.
Some people are visionaries. They’re fired up by new ideas, excel at having a macro point of view, and want to race ahead to implement a grand vision. Others are detail-oriented and love being in the weeds with specifics and data, working to understand the intimate details of how work gets done. The world needs both types of people. Strategic leaders harness elements of both personality types by becoming aware of their own strengths and then creating a personal development plan for gaps or looking to outside resources (collaborators, hiring new staff, etc.) to compensate.
The fact that you picked up this book means you know you want to evolve in some way. We can’t underscore this point enough: if you want to be a strategic leader, you must be ready to change yourself, change your department, and change your organization. Willingness to change and improve underlies our entire model.
Imagine this: you are part of a team evaluating something in your organization that’s high-profile, expensive, and beloved. Maybe it’s a national advertising campaign, an employee productivity platform, a major training curriculum, or a sales channel partnership. Whatever it is, it’s near and dear to your department and well-known throughout the organization. When the findings from the analysis begin to roll in, you find out that the program isn’t working. You thought it was successful, but it turns out those success metrics aren’t driving business results. You’ve just learned that you are pouring money into an initiative that’s not doing what it’s supposed to. What decision do you make? What are your options?
Reading this scenario in a generalized format, it’s relatively easy to say, “Of course I’d pull the plug.” But put yourself through the mental exercise of coming to such a finding about your flagship initiative. The one for which you personally pushed to get funding, and then promoted to everybody with lots of grand promises about a huge ROI. It’s personal, and it’s painful. It’s so painful that those kinds of findings are often shelved. People make excuses: the evaluation model was flawed, or we didn’t have access to the right data to prove the impact, or the political climate is such that we need to stay the course, or the CEO loves this program, so it has to stay.
Here is where we stop and tell you that if you aren’t ready to cut your pet project after finding out that it’s not delivering the value the company needs, then you aren’t in the right mindset to read this book. Set it aside and come back when you’re ready for blunt honesty, a truth that is sometimes agonizing but leads to better things. You can make a huge difference, but it all starts with your willingness to change in order to drive smart, organizational change. And sometimes willingness to change means we have to let go of the things we love. It means asking hard questions and running the risk of appearing foolish. It could mean you have to tell your boss that she made a critical mistake or confronting naysayers when you typically avoid conflict. It also means asking for help and advice from those around you, reaching out to connect with supporters and denigrators alike. Above all, willingness to change means being the kind of leader that your organization so desperately needs you to be.
