My love-hate relationship with marketing

I’m an accountant, so I am not supposed to love marketing, am I?

When I started in industry, marketing budget were cut, how can you justify the ROI on that spend. So much time was spent understanding the return on money spent, some easier than others to explain.

However, when cash needed to be saved it was the easiest spot. It didn’t impact the bottom line, that you can really measure easy compared with other costs.

Then I started my own business, and everything change. Marketing costs started getting put into different buckets;

• Brand – brand awareness. Wanting people to know the Whiteark brand, without awareness people will not think Whiteark when they have a problem. So, with a new business this required a bit of planning, spending and time to get right.

• Events – client events, potential client events & dinner to entertain people was important to build deeper relationships with the right network.

• Content – With the brand in play, having relevant content across social media so potential clients would spot us, understand our value proposition and when a problem came up they would think call Whiteark. Regular content and varied content that was unique was important.

• Podcast – like everyone in the 2020 year with COVID we started a Podcast, it was based on interviewing a leader to understand what made them tick and their leadership journey. It was a great podcast, we did 52 in 52 weeks and then we stopped but we loved the interviews and we got some regular listeners.

• Listings – consulting listings, female network listings and other listings to ensure that we would come up if people were looking

• Website – constant updates to website to ensure new and interesting information

• Brochures – regular brochures that are hard copy and soft copy about our service

• Email campaigns – through Linkedin and/or through Mailchimp through regular newsletters.

• And other things that I now consider marketing…..

It’s hard to measure the success of the marketing stuff listed about but then you speak with a potential client, bump into someone that wants to partner on something or someone reaches out on Linkedin off the back of your postings or seeing some new content.

But whatever the case brand and marketing is important. It’s sometimes hard to measure, but there is ROI. You just need to find the right balance between spend and ROI.

Companies these days, larger companies can measure ROI on marketing campaigns more successfully than they have been able to in the past, which helps them invest in retention, but the cost of acquisition is always a challenge, for most businesses.

When you own a consulting business, the marketing play is a long play, not a short play and therefore you need to be comfortable with what you invest and the return you will make in the short term, and the long term.

So, I am a frustrated marketer and like to see the difference that certain campaigns have on statistics at month end and understand how to make them improve month-on-month. Measuring the key engagement stats every month also helps to understand what people that are engaging with the business enjoy.

If you are looking for a marketing expert, you’ve come to the wrong place LOL, however if you are looking for a frustrated marketer that has learnt to love marketing and all things associated with it, as I founder my business, you’ve come to the right place.

We have some cool content and always something new prepared to read, new templates, new industry reports or we always have something to say, so tune in and you’ll see our content strategy in real time.

I hope you like this article, I had fun writing it. 🌞

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If we can help you, reach out for a no obligation chat to Jo Hands on 0459826221, or jo.hands@whiteark.com.au

Article by Jo Hands, Whiteark Founder

You might want to explore other thought leadership articles

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The key questions to ask - why? what? how?

Are you one of those people that asks a lot of questions – why are we doing this? What is this all about? And How are we going to deliver this? Simple words and questions but critical in all aspects of business. I have to admit it does annoy me when people ask too many questions, but it really is good engagement. It means they are engaged, they are listening and they want to understand the background.

Sometimes our communication gets so bogged down that it’s hard to follow – and it’s hard for people to come on the journey because they don’t understand the basics. As a leader being able to article the Why, What and How of a companies:

• Strategy

• Overall Plan

• Particular Change 

Is critical.

Right now as we run into the new financial year (for most companies) this comes more important. It’s a great opportunity to use these questions to speak to your team about the new financial year. To think about how to frame things up and get people onboard.

Why?

Definition of Why:
The cause, reason, or purpose for which know why you did it that is why you did it.

The power of the Why.

Employees are more focused than ever on the Why. Fundamentally why does this company exist? They are looking for value, purpose in why the company exists. Some companies have this and other companies this becomes a challenge. Do you understand your why? Does it resonate with the employees? Is it truthful and focused? Have you communicated it. It’s important that as a leader you understand the why and can articulate this to the team.

Simon Sinek famously talks about Starting with the Why in his famous books and ted talks. 

Start With Why shows that the leaders who’ve had the greatest influence in the world all think, act, and communicate the same way — and it’s the opposite of what everyone else does. Sinek calls this powerful idea The Golden Circle, and it provides a framework upon which organizations can be built, movements can be led, and people can be inspired. And it all starts with WHY.

Why?

Definition of Why:
Asking for information specifying something.

The cause, reason, or purpose for which know why you did it that is why you did it.What are we going to deliver this year? What are the initiatives, what are the funding and plan of what we will deliver over the next 12 months. Being clear on the plan and how it links to the Why. Making sure what we are doing is linked with the Why is critical. If the What is not aligned to the Why it becomes meaningless.

Research has shown that companies that have more than 5 priorities deliver less than 18% of their plans. Being clear on your priorities and the alignment to the Why is critical. There is no point having a Why and What if you can’t deliver the how.

How?

Definition of How:
In what way or manner; by what means.

Maybe this is the most important question and people miss this step. If you have a clear why and what – how are you going to deliver? How are you going to operate (values, operating rhythm), what is the plan to get you there? How are linking strategy to execution to ensure the why and what build a plan on the how. The how is normally missed and means that you are not delivering the outcomes you want to achieve.

Most companies are focused on providing a ‘why’ for their teams. Finding that ‘purpose’, that reason to associate with the brand that is not about filling pockets of shareholders. This is a hard one. More and more there is a challenge for employers to represent meaning in working for their company. Employees are demanding this and Employers and trying to align the Why story…but it’s a struggle. 

The ability to be able to communicate the

• Why

• What

• How

consistently, effectively and in an aligned manner is critical.

Key things to think about when communicating with your employees:

1. Being able to articulate the Why of your company?

2. Being able to articulate the What – are you trying to achieve?

3. Being able to articulate the How – are you going to do this?

Keeping communication simple and consistent is critical. Take the time to ensure you understand and you articulate this to your employees.

Life's a journey - what does this mean?

One piece of advice my dad gave me, was to remember that life is a journey. It’s hard when you are 20 years old to really know what this means?

As I get older, a ripe old age of 42 I really consider this concept of journey. It’s an interesting one, very personal and something that evolves.

The dictionary says that journey is – an act of travelling from one place to another. Where are we travelling too? What is this journey of life. Wow, very deep thing to think through.

I am not sure I have the degree to make an assessment on where we are heading, I can definitely focus on what this journey needs to look like, what is a successful journey. 

In business, when we start a program we normally start by designing the end-state view – what does success look like, where are we heading and what are the key design principles that need to be determined in relation to this. This sets the course, direction and gives people something to anchor too. It makes decisions easier and allows people to work towards a common goal. I suppose life is not that simple – what is the end state you are building and what are the design principles to make decisions around your journey? Maybe that is why people talk about what you want people to say at your funeral, that is quite depressing but maybe they are trying to design this end state view to build the guardrails for the journey. On the journey of life it’s probably not that easy.

To define success for your journey, you should consider the following:

• What makes you happy – do more 

• What are you good at – do more

• What is aligned to your strengths – do more 

• What develops you / stretches you, in the right direction – do more

• What allows you to associate with people that inspire and challenge you – do more

• What makes you miserable – do less

• What makes you uninspired – do less

• What makes you focus on counting down the week – do less 

• You know in your gut it’s not good for you – do less

So many more rules you could apply, but you get the drift. You need to determine what you are going to do in your journey, it’s like a choose your own adventure book… you remember you can pick which direction you took the characters on. The reality is life, is like a choose your own adventure, but there are also things that you can’t control that will land in your lap and how you respond.

When thinking about the journey, people reference sprint versus marathon and ensuring you don’t go to quick you burn yourself out and you enjoy the journey. Everyone has a different pace, but sometimes you do need to slow down – for your health, for your family, to slow down to speed up, so people can keep up.

What is your pace?

Enjoying the journey, as you get older you realise that you need to enjoy the journey – life’s short. Time speeds up and making the best of every time you have in life is so critical. This means spending time with people that inspire, challenge and encourage you. Caring about their opinions but not listening to others. Embracing yourself, imperfections and all and do what makes you happy. 

On the journey there will be great days, there will be speed humps and there will be an accident on the freeway that will stop you in your tracks. The hardest days are the ones that will demonstrate to yourself your tenacity, your passion and your ability to keep going. While you are in the moment, it will appear too much and once your through you will proud of your achievement.

Remember take time on the journey for a breather – to reflect what you have achieved, where you are and how you are going to continue on your journey. You continue to learn lessons, some the hard way that may change your journey, how you approach your journey or your destination. 

Regardless of what you see on social media, no one has a perfect life. So be kind to yourself, to others and don’t compare, just enjoy your journey and make sure you have some great people on the way you can share the journey with!

I know that on my journey I want to make a difference to people’s life for the better. I am passionate about helping businesses optimise and I hope that I can leave a legacy in working with businesses to drive success.

How to Master Delivery

The plan is built, you have the budget, why can’t you deliver? 

It’s the issue that is widely known, the easy part is building the plan and getting the money (well sometimes) but being able to deliver the plan is the hard thing. When the plan is unclear or money hard to get it’s a good excuse, when that’s done there are no excuses you need to be able to Execute. 

At Whiteark this is where we see our clients need help and this is our sweet spot, being able to help deliver a program of work. There are 4 key steps that need to be taken to ensure the plan is successfully executed.

Key four steps:

Step 1: A detailed plan is required.

The plan must be very detailed and provide information on the following:

• Tasks

• Timeframe

• Responsible Party

• How success will be measured

Building out the program is critical with the required detail to measure if things are offtrack and the flow on impacts. Understanding key dependencies is critical and managing them as well (in this case Technology Services).

Step 2: The right capability must be identified to execute the plan

This might be a mix of internal capability, partners and other consultants but being clear on roles & responsibilities and having the right capability to:

• Deliver the required outcome

• Do it at a speed that is sustainable 

• Deliver the right outcome

Allow coaching and training so the team left behind after the project are upskilled and can do it without external help

Step 3: Flexibility to pivot, change direction & work some of the program out along the way is critical.

The original plan won’t work perfectly, the program needs to allow an element of flexibility when things don’t go to plan, you identify something else along the way.

Step 4: Sponsorship.

Strong sponsorship on the program. Executive sponsorship that is willing to go into battle will be critical. Absolutely critical. There will be roadblocks, issues that prevent the program moving and you need someone to move these out of the way and be focused on seeing the program deliver.

What we know from experience is?

All four steps are required to ensure effective execution. Things don’t always go to plan, but having a clear plan to be able to pivot or make changes in the program is critical. 

But just start, the team will see change, will embrace the change and lean it but just start the program, piece of work and get delivering. It will give you credibility, and the naysayers will go quiet or change their tune.

Making change, transforming and the building the new is hard. It’s harder than you think but it’s rewarding, fun and definitely worth the effort from an organisation to put the right leadership to deliver.

Get the delivery right is critical. Sometimes it’s hard to know where to start, but once you start you’ll get the momentum to keep going.

At Whiteark, we love helping companies execute their plans. Taking the strategy and what success looks like (goals) and building a roadmap and plan that can be delivered. We coach and help businesses set up their program with test and trial and an approach that works for them. Our goal is to ensure they can execute and that the capability in the organisation is developed to own the go-forward.

Are you measuring what matters?

If it’s not part of your KPIs it’s probably not worth measuring.

Most of us have heard the phrase ‘what measures gets done’. Sounds simple right? But when it comes to measuring what matters, it gets a bit tricker. 

There are many organisations that aren’t clear on what they should be measuring. An easy way to address this is by using my KPI scorecard – see the breakdown below.

1/ Alignment to Strategy

Ensure the metrics being measured align with your organisation’s strategy. For example, if you’re measuring organic traffic to your website but your strategy is all about driving leads via performance advertising, then this should be your first focus. 

Every KPI should have a measurable lead indicator. Sure, you can measure outside of this, but put your KPI measurements first and ensure they are adequately resourced before looking at anything else. 

2/ Set Targets

For each of the key metrics, set targets that are a stretch by achievable. These targets should align to a financial year; end of year target and monthly profile to deliver the end of year metric. 

Look at your baseline for last fin year and then consider the environment you’re operating in now and what kind of % increase you think can realistically be achieved. Talk to the relevant experts in the business and ask them to help form a plausible growth scenario. 

3/ Regular Measurement

When selecting what data outputs you’ll be measuring, get picky. There should be no more than 20 key metrics that a business reviews and measures each week. For metrics that aren’t performing; a detailed plan should be prepared for the next month to get the metric back on track.

4/ Refresh Your Metrics

Sticking to the same strategy all year isn’t always realistic. The beauty of measuring strategic outcomes each month allows for real time business decisions. This informed angle, means you can confidently pivot when necessary. If this is the case, update your metrics to align with these changes. And don’t forget to clearly document these changes and communicate them to the wider team. Especially those who are managing measurement.

TOP TIP
It’s important to note; while financial metrics are critical, non-financial metrics are also key drivers, working to align the overall vision and values of the organisation.

Stop Your Reporting

Once you’ve sorted your KPI scorecard, it’s time to take a step back. Most organisations have so much reporting that it doesn’t get reviewed or given the attention needed to make it valuable. This is a common problem and can also make the task of analysing data end up in the ‘too hard basket’.

So stop. Now that you have a clear idea of what you should be focussing on, everything else is just clutter. Put in place one weekly dashboard of the top 20 metrics that align to the business objectives. Provide performance and commentary for how each of the metrics are tracking. If you have a clear view on these, you’re much better off than measuring more but not reporting accurately. 

Need a Starting Point?

Whiteark can help. We have a network of experts with practical experience implementing metrics measurements that matter to organisations. Whether it’s advice or hands-on assistance, the Whiteark team are your go-to for valuable data analysis. Contact whiteark@whiteark.com.au or 1300 240 047 to discuss.

Happy End of Financial Year.

Happy end of Financial Year

– the clock strikes midnight on the 30th June…..Yipppppeeeeee.

I’m an accountant at heart, so 30th June is more exciting than New Years Eve. Why?

It’s a great opportunity to reflect. What have I achieved this year. What am I most proud of. What is my biggest learning. Who has supported me this year – make sure you say thank-you. I always encourage my teams to update their CV every year – what have they learnt, where have they developed it’s a good way to remember all your achievements as well.

It’s also a new beginning in some respects:

• New budget

• New goals / objectives

• New priorities

• New Funding 

• New Tax Year

There is an element in companies, where people need to wait until 1 July, until they can spend the money on the next project, phase or project or new recruitment. It’s kinda silly but you see how it happens as the funding aligns with the new financial year.

The new financial year, gives you a chance as a leader to reset with your team – to set them up on clear priorities, with clear goals and provide a chance for a reset, if things haven’t gone to plan in the old FY. Starting the year with clear priorities and goals is critical and defining what success is for the year for the company, department, team and individual. 

Getting some momentum at the beginning of the Financial Year is critical, for people to see the pace has changed, that energises the team and resets the expectation on how the team is going to operate. Finding some quick wins at the beginning of the financial year for the team is a good focus as a leader.

Measuring what matters, makes sense. Many companies don’t do this well. Starting a new financial year allows you to reset the priorities of the company and ensuring that you are measuring lead and lag indicators – not to many metrics but the right ones. Having regular reporting with these metrics is critical and ensures changes can be made as required / and quickly to change the course of the outcomes

So why I love the end of financial year:

• It’s a chance to reflect on the old year

• It’s a chance to reset the ways you are doing things for the new year to make it bigger and better

• It’s a change to set your team and organisation up for success

Are you ready for the new FY, the budget is approved:

• Have you defined your success metrics

• Have defined your reporting 

• Have you defined how you are going to operate

• Have you engaged your team on this journey

Happy Financial Year – from the Whiteark team.

The Whiteark Guide to Strategy & Execution

The key building blocks to guide the process of strategy to execution.

Answering strategic questions will form the basis of the key components to the Company Strategy building block.

•What is your current situation?

•Where do you want to go from here?

•What do you want to accomplish?

•How do you get from where you are today to where you want to be in the future? What are the steps do you need to take?

•What obstacles will you have to overcome? What problems will you have to solve?

•What skills and capability do you require to achieve your strategic objectives?

•What problem does your company seek to solve?

•Why do you believe this problem needs to be addressed?

•Does this problem matter to others?

•What are your offerings to solve this problem?

•What is the nature of your products and services?

•What specific customer/consumer needs are you addressing?

•Who are your ideal/target customers?

•What is your unique selling proposition?

•Are there other comparable offerings in market?

•What differentiates you from your competitors?

In today’s unpredictable environment strategic planning needs to be adaptive.

Covid-19 has been the catalyst for companies to reset their business strategy. In a time of such uncertainty, executive leaders need to be increasingly reliant on adaptive strategies so that they can set long-term goals but still flex with evolving conditions.

Contents of the Guide.

• Key building blocks for strategy to execution

• Considerations for each building block

• Adaptive strategy

• Building block one - market and industry trends

• Building block two - companies strategy

• Building block three - build the plan

• Building block four -manage performance

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Looking for help with your strategy? Reach out.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes. We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. So, if you’re looking to transform, reimagine or upgrade your strategy, then give us a call on 1300 240 047 for an no-obligation conversation.

Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

How should we think about Complexity? Is it complicated?

Article written by Mark Easdown

Business Planning, Mental Models, Ways of Thinking & Working

“A complicated system is the sum of its parts. You can solve problems by breaking things down and solving them separately. In a complex system, the properties of the whole are the result of interaction between the parts and the linkages and the constraints. In fact, in a complex system how things connect is more important than what they are. So, the properties of that emergent pattern can never be decomposed to the original parts.” David Snowden

“The problem is complexity (in financial markets) …we cannot prepare for every thread of causality through every interaction; in the speed of the event we find there is no time to make adjustments.” Richard Bookstaber

“Nature likes to over-insure itself. Layers of redundancy are the central risk management property of natural systems.” Nassim Taleb

In the mid 1980s, a school of thought emerged around “Complexity” and “Complex Adaptive Systems” with the formation of the Sante Fe Institute, formed in part by former members of Los Alamos National Laboratory. The institute drew from multi-disciplinary domains and insights of : economics, neural networks, physics, artificial intelligence, chaos theory, cybernetics, biology, ecology and archaeology. Theories on Complexity and Complex Adaptive systems sought to develop common frameworks and understandings of physical and social systems that was an alternate to more linear and reductionist modes of thinking. Members sought to better understand spontaneous, self-organising dynamics and found examples in the;

• Natural World - Brains, Immune Systems, Ecologies, Cells, Developing Embryos and Ant colonies

• Human World – Political parties, Scientific communities and in the economy

Why bother?

Just say you and your team are facing a complicated problem, then you may break down the problem into component parts, build an expert team internally or partner with external consultants, you may take a data driven or fact-based approach, you may identify best practices create a strategic plan and solve the problem incrementally. However, is that all? Is there a one size fits all solution to problem solving?

What if your problem could be categorised with traits such as;

• Levels of uncertainty, ambiguity, unpredictability, dynamic interfaces - many diverse and independent parts that were interrelated, interdependent and linked through many interconnections into a network

• The properties of the whole cannot be predicted from the behaviours of the component parts, in fact the network of many components may be gathering information learning and acting in parallel in an environment produced by these interactions – the system co-evolves within its environment

• There may be significant political, social or external influences

“Wise executives tailor their approach to fit the complexity of the circumstances they face.” David Snowden & Mary Boone

Where in the real world might it be useful to have sound thinking about complexity and solving problems? 

In Project Management

Programs of work and problems to solve come in a variety of forms, at the simpler end of spectrum process re-engineering and best practices serve us well to achieve desired outcomes. Yet increasingly, our problems to solve are complicated, we need to analyse things to figure out what to do and cause and effect are distanced. Complex projects are harder still, they display behaviours such as self-organising, emergent properties, non-linear and phase transition behaviours. We need a different mindset, structure and strategy to wrestle with these problems.

In Financial Markets

These are complex adaptive systems, tightly coupled with unexpected feedback loops, with investors of different investment styles & horizons, the sum of the parts will not explain the whole in a linear manner, there are infrequent extreme price moves, not normally distributed.

In Nature

Complex collective behaviours are displayed when individual ants forage for food and lay down a pheromone trail on the way out from the colony and if successful finding food lay down even more on way back to the colony. Other ants follow this stronger pheromone trail to the food adding their pheromone. So, the pheromone trail becomes the whole colonies best path to food, it is an ant colony optimisation algorithm. Interestingly, this insight has helped form the basis of swarm intelligence and a wide array of solutions across routing and scheduling problems and bayesian networks.

 The twenty-first century will be the "century of complexity"  Stephen Hawking

COMPLEX PROGRAMS

“Strategy in complex systems must resemble strategy in board games. You develop a small and useful tree of options that is continuously revised based on the arrangement of the pieces and the actions of the opponent. It is critical to keep the number of options open. It is important to develop a theory of what kinds of options you want to have open” - John H Holland

In complex situations "cause and effect are only coherent in retrospect and do not repeat" - Sarah Sheard

Complex problems to solve are unique and they challenge some of the traditional approaches to program and risk management thinking, which may emphasise a need to identify risks in order to control them or completely plan and control programs of work. Examples of complex programs may include: computer systems and networks, buildings, bridges, planes, ships and automobiles.

Let’s take a look at what makes complex programs unique; 

• Sophisticated structures with many component parts interacting with each other, giving a degree of uncertainty whereby you may not know what you don’t know until it occurs

• Unknowable interdependencies across domains, a need for agility and structures that favour the decentralised and local to the centralised approach.

• There may be interfaces with complementary projects which present challenges in scheduling of these interconnected systems, teams and resources

• The environment may have a political realm where new government decisions or public policy arises

So, what is a desirable mindset for complex programs?

• A Forward focus, a willingness to proactively manage project development and critical issues through agility, collaboration and adaptability. You may need nuanced responses and local innovation.

• Analysis of likely origins of complexity and thinking through dependencies, seek critical junctions, vulnerabilities & countermeasures. Contingency planning around time, buffering on sequencing, budget and people skills 

• Dynamic reporting and monitoring, a willingness to pick up early warning signs and take corrective actions

• Communications will be dynamic, real time & high visibility (as small changes can have oversized consequences amplified by scale of some projects)

• Program planning may have both a single view and multiple integrated project schedules

Cynefin is a framework to deal with predictable and unpredictable worlds (David Snowden)

In 1999, David Snowden described a framework and problem-solving tool which helps to adjust management style to fit circumstances, and has relevance across product development, marketing, organisational design and BCP/DR and crisis management. The framework had 5 domains;

• OBVIOUS. Options are clear, steps to success are known, variables well known, cause-effect relationships are apparent, you are able to assess the situation, follow a procedure, categorise its type and base your response on best practice (processes & procedures) and feasible to achieve best possible result. Examples: Product mass production, cooking with a recipe, known scientific issues, known legal issues. 

• COMPLICATED. Solutions not obvious to everyone but most variables involved are well known, cause-effect relationships are apparent, you may assess a situation, build a diverse team or utilise experts to deliver the best response. The best that can be achieved is a good result, maybe not the best result. Examples: Existing product enhancements, coaching a team, adopting new approaches, hiring process.

• COMPLEX. The context is often unpredictable, many factors uncertain, many variables may intervene, data may be incomplete, it may not be possible to determine right options, make predictions or find cause-effect relationships, there may be multiple methods to address issues. Exploring what has a proven record in past situations, small tests or business experiments, simple guidelines, brainstorming, innovation and creativity may drive solutions. Examples: weather predictions, stock markets, poker, epidemic controls.

• CHAOTIC. The situation is where nobody knows what to expect, anything can happen, it is impossible to make predictions. You may have to act towards the urgent and important, then check and evaluate result before responding to that result and acting again. Examples: Innovate new products, anything which predicts people’s preferences or behaviours, crisis event and crisis management, warfare

• DISORDER. The situation is not known, you need to firstly move to a known domain & gather more information.

COMPLEXITY IN FINANCIAL MARKETS

“In the last few years the concept of self-organising systems – of complex systems in which randomness and chaos seem spontaneously to evolve into unexpected order – has become an increasingly influential idea that links together researchers in many fields, from artificial intelligence to chemistry, from evolution to geology. For whatever reason, however, this movement has so far largely passed economic theory by. It is time to see how the new ideas can usefully be applied to that immensely complex, but indisputably self-organising system we call the economy” - Paul Krugman 1996

“By one estimate, 90% of international transactions were accounted for by trade before 1970, and only 10% by capital flows. Today, despite a vast increase in global trade, that ratio has been reversed, with 90% of transactions accounted for by financial flows not directly related to trade in goods and services.” - Didier Sornette 2003

“Fundamental analysis seeks to establish how underlying values are reflected in stock prices, whereas the theory of reflexivity shows how stock prices can influence underlying values. One provides a static picture, the other a dynamic one.” - George Soros

Financial markets have all the basic components of complex adaptive systems, namely:

• Investors have differing investment strategies and horizons from trading at the speed of light to long term cyclical horizons. They take external information and combine it with their own strategic intent and these compete in financial markets => this is adaptive decision making

• Financial markets is the aggregation of large-scale collective decision making and actions => these are developing, complex and emergent

• Financial markets exist in a non-equilibrium state , are non linear, they experience non-frequent extreme price moves with the aggregate behaviour more complex than would be predicted by the sum of the individual parts.

• Financial Markets are subject to feedback loops, where the result of one iteration becomes an input of next iteration

So, how has the emerging knowledge of complexity and financial markets framed regulators thinking?

The global financial crisis highlighted the complexity, leverage, inter-connected and tightly coupled of financial markets. In response we have seen;

• Efforts to reduce interconnectedness (intra-day local trading halts, regional collateral exchanges)

• Enhanced capital rules (increased contingency buffers and incentives for some activities to be managed by non-bank sector & efforts to reduce concentration of risks)

• Enhanced liquidity rules (increase quantum and quality of contingency buffers)

• Speed, agility and quantum of central bank and treasury initiatives to address market panics and crisis

• A re-think of the rule-making complexity and mental models applied to finance;

“Modern finance is complex, perhaps too complex. Regulation of modern finance is complex, almost certainly too complex. That configuration spells trouble. As you do not fight fire with fire, you do not fight complexity with complexity. Because complexity generates uncertainty, not risk, it requires a regulatory response grounded in simplicity, not complexity. Delivering that would require an about-turn from the regulatory community from the path followed for the better part of the past 50 years. If a once-in-a-lifetime crisis is not able to deliver that change, it is not clear what will.” - Andrew Haldane Bank of England Speech 2012 “ The Dog and the Frisbee” [https://www.bis.org/review/r120905a.pdf ]

COMPLEXITY IN NATURE 

In her TED Talk, Deborah Gordon: The emergent genius of ant colonies: highlights an example of a complex adapative system with no central control or management in an ant colony: [ https://www.youtube.com/watch?v=ukS4UjCauUs]

So, what is the strategy of the ant colony to constantly adapt to its complex environment? As per Deborah Gordon studies;

• The ant colony allocates simple roles

  • At any given time 25% are patrolling, foraging and doing maintenance, 25% are inside with queen ant doing maintenance and looking after larvae, and finally 50% appear to be contingency and in reserve, able to surge as required to collect more food, patrol or more maintenance.

  • Communications are not centralised, they are dynamic, simple and local rules to adapt to emergent environment

  • The process is noisy, messy, imperfect and requires individual dynamic communications

Ant colonies can learn at the individual level by trial and error over many generations but this can nurture collective memory and problem-solving skills. The local instructing the central.

“So, the key to unlocking the efficiency of a leaderless system will rely on, among other things: clear role definition, flexible task allocation, a sense of responsibility toward the group, and shared understanding and response to communication patterns. Organizations would need to make an incredible investment in their employees, and vice versa.” Amanda Silver – Organising complexity – How Ant colonies self-manage. [https://medium.com/swlh/organizing-complexity-how-ant-colonies-self-manage-50455358f3cd]

How we should think about complex domains is still evolving, a multi-disciplinary lens across research and practice has been adding to this knowledge pool for decades. It is a vital enquiry for humankind, especially as our challenges become more complex to solve and our climate is as a complex adaptive system.

‘“he climate is a common good, belonging to all and meant for all. At the global level, it is a complex system linked to many of the essential conditions for human life.”- Pope Francis 2015

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LOOKING TO CURATE YOUR BUSINESS STRATEGY? REACH OUT.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes.

We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

Article written by Mark Easdown

Transforming your Sales and Service Model

Are you ready to take on a bold sales and service model transformation? Now is the time to reinvent your model and integrate the value your business provides into the “new” societal landscape post the global disruption of Covid-19. In today’s environment, your successful sales and service transformation will be enabled by strong leadership, facts driven from data and analytical insights, and new approaches to technology.

It is important that you remain flexible and resilient while looking to the future - redefine your operations so that you can emerge stronger than your competitors. You must pivot your sales and service models in response to the new societal landscape - purchasing power is shifting fast, the demand for digital channels is rising. To retain customers, protect revenues and realign go-to-market investments you must pivot your sales and service model to meet the constantly changing expectations of your customers.

Hold tight and embrace the uncertainty – be courageous and apply a different approach to how you would usually gain market share all while monitoring the shift in consumer demands to ensure you are ahead of the competition.

Below are the key considerations for redesigning your sales and service model:

• Rediscover your customer - understand your customers so that you can meet their evolving wants and needs so that you can remain relevant

• Redefine the sales and service journey – segment your customers and focus your efforts on the strongest and most profitable opportunities

• Enhance your product/service offering to meet customer expectations - reinvent through new narratives, approaches and terms, and diversify dynamic offers

• Enable your team with the tools and skills to succeed in today’s digital age – ensure you provide your team with the key enablers that they need to support them in being successful  including training and coaching, sales tools, technology

• Reward your sales and service resources for the right behaviour/outcomes – align on priorities, determine the metrics to monitor, measure performance and reward success to keep your workforce motivated

If you need help with transforming your sales and service model to meet the needs of customers in today’s environment, please reach out to Whiteark for a no obligation consultation and we can help you navigate your future to success.

Data

Every organisation has data in abundance, but not many companies have it organised and streamlined to drive meaningful outcomes.  It's a shame…

Data is powerful

Data that has been analysed with other variables is powerful. 

Data can tell you the Why

Data can tell you why or get you to understand the trend.

Data can drive the predictive analytics

Data can give you the 'so what' or now that we know 'what can we do with this information' .

Data should drive:

• Strategy decisions 

• Operational decisions 

• Pivot on strategy 

• Operational improvement 

• Good commercial decisions 

At Whiteark we are big on data. We use data and data tools to analyse a problem / or root cause and we use data to drive value creation and measure success. 

We have a number of case studies at Whiteark that demonstrate the power of data and what we have achieved with our clients.

Data is powerful. If you need help to generate the power, reach out to Whiteark.

Browse more articles about the power of data: 

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Need support in your organisation? Reach out.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes.

We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

Article by Jo Hands, Co-Founder Whiteark

Forecasting

Article written by Mark Easdown

Decision Making & Planning, Ways of Working with Uncertainty

“The only function of economic forecasting is to make astrology look respectable.”

— John Kenneth Galbraith

“Forecasts usually tell us more of the forecaster than of the future.”

— Warren Buffett

“There is great value in bringing together people who attempt to address a common problem of forecasting from different perspectives and based on very different kinds of data.”

— Chris Wood, Sante Fe Institute

“Your assumptions are your windows on the world. Scrub them off every once in a while, or the light won’t come in.”

— Isaac Asimov

“For superforecasters, beliefs are hypotheses to be tested, not treasures to be guarded.”

— Philip Tetlock

“I prefer true but imperfect knowledge, even if it leaves much indetermined and unpredictable, to a pretence of exact knowledge that is likely to be false.”

— Friedrich von Hayek

“The Lucretius underestimation, after the Latin poetic philosopher who wrote that the fool believes that the tallest mountain there is, should be equal to the tallest one he has observed.”

— Nassim Taleb

A forecast is a statement about the future. (Clements & Henry, 1998)

As authors of “Forecasting” (J.Castle, M.Clements, D.Henry) note; a forecast can take many forms;

• Some are vague and some are precise, Some are concerned with near term and some the distant future

• “Fore” denotes in advance whilst “Cast” might sound a bit chancy (cast a fishing net, cast a spell) or might sound more solid (bronze statues are also cast)

• Chance is central to forecasting & forecasts can and often do differ from outcomes

• Forecasts should be accompanied by some level of certainty/uncertainty, time horizon, upper/lower bounds

• The domain in which the forecast occurs matter, especially if no-one knows the complete set of possibilities  

The authors consider the history of forecasting;

• Forecasting likely pre-dates recorded writing with hunter-gatherers seeking where game of predators might be, edible plants and water supplies. Babylonians tracked the night sky presumably for planting and harvesting crops

• Sir William Petty perhaps introduced early statistical forecasting in 17th Century and thought he observed a seven year “business cycle”

• Weather forecasting evolved with Robert Fitzroy in 1859, who sought to devise a storm warning system to enable safe passage of ships and avoid loss of vessels &/or ships staying in port unnecessarily. Forecasting of nature extended to hurricanes, tropical cyclones, tornadoes, tsunamis and volcanic eruptions.

• Yet, history is littered with failures in forecasting, large and small;

  • Ambiguous forecasts from Oracles of Delphi and Nostradamus

  • UK storms 1987, with lives lost and approximately 15million trees blown down

  • Failure to predict 1929 Great Depression or severity of Global Financial Crisis, mid-2007 to early 2009

  • “When the Paris exhibition closes, the electric light will close with it and no more be heard of it” – Sir Erasmus Wilson & “a rocket will never be able to leave the earth’s atmosphere” – NY Times 1936

What do we want from forecasts ?

• Do we want just accuracy? To what degree is that even possible across complicated and complex domains?

• Do we want cognitively diverse teams to make us more aware of extreme events? Thus, minimising downside risks?

• Do we just want comfort, ideological support and evidence of our existing beliefs? Do we want entertainment?

• Do we want to influence a target audience, shift consensus or established beliefs?

These answers may differ if you are a CEO, CFO, Head of Sales, Head of Innovation, an Insurance Actuary, Epidemiologist, Politician, Economist, Intelligence Agency, Shock Jock or Sports Commentator.

For example, it was a mainstream view of epidemiologists across last 20 years that a pandemic was a prominent risk;

“The presence of a large reservoir of SARS-CoV-like viruses in horseshoe bats, together with the culture of eating exotic mammals in southern China, is a time bomb. The possibility of the re-emergence of SARS and other novel viruses from animals or laboratories and therefore the need for preparedness should not be ignored.”- David Epstein 2007

https://davidepstein.com/lets-get-ready-to-rumble-humanity-vs-infectious-disease/

https://cmr.asm.org/content/cmr/20/4/660.full.pdf 

So, is COVID19 perhaps SARS2?  Clearly, forecasting a pandemic is desirable. How do we give prominence to diverse voices & data and what are the better practices to observe and implement?

SUPER-FORECASTING

In October 2002, the US National Intelligence Estimates (a consensus view of the CIA, NSA, DIA and thirteen other agencies with > 20,000 intelligence analysts) concluded that the key claims of the Bush Administration claims about Weapons of Mass Destruction in Iraq were correct. After invading Iraq in 2003, the US found no evidence of WMDs. “It was one of the worst – arguably the worst  - intelligence failure in modern history” notes Philip Tetlock and Dan Gardner in their book “Superforecasting : The Art and Science of Prediction”

In 2006, IARPA was formed to fund cutting-edge research with the aim of potentially enhancing the intelligence community work. IAPRA’s plan was to create a tournament-style incentive for top researchers (intelligence analysts, universities & a team of volunteers for the Good Judgement Project (GJP)), to generate accurate probability estimates to questions that were;

• Neither so easy that an attentive reader of the NY Times could get them right , nor

• So hard that no one on the planet could get them right

Approximately 500 questions spanned: economic, security, terrorism, energy, environmental, social and political realms

Forecast performance was monitored individually and in teams, and Tetlock’s GJP team proved 60% more accurate in year 1, 78% more accurate in Year 2.

• What did these forecasting tournaments learn about the attributes of super-forecasters that may be of relevance in Commercial or Government organisations? Here are a few;

• Superforecasters spoke in probabilities of how likely an event would occur (not in absolutes : yes/no), this better enabled them to accept a level of uncertainty – it made them more thoughtful and accurate

• Superforecasters were often educated yet ordinary people with an open-mind, an ability to change their minds, humility and an ability to review assumptions & update forecasts frequently, albeit at times by small increments

• Actions which were helpful included;

  • Breaking the question down into smaller components and identifying the known and the unknown, focus on work that is likely to have better payoff, actively seek to distinguish degrees of uncertainty, avoid binding rules. Consider the “outsiders” view, frame the problem not uniquely but as part of a wider phenomena

  • Examine what is unique about problem and look at your opinions and how they differ from other people’s viewpoints. Take in all the information with your “dragonfly eyes” and construct a unified vision, balancing arguments and counterarguments, balancing prudence and decisiveness – generating a description as clearly, concisely and as granular as possible

  • Don’t over-react to new information – a Bayesian approach was useful

• The GJP found that while many forecasters were accurate within a horizon of 150 days, not even the super-forecasters were confident beyond 400 days, forecasts out to 5 years were about equal with chance.  

• What about forecasting teams versus forecasting individuals?

o   With good group dynamics, flat and non-hierarchical structures and a culture of sharing – teams were better than individuals – aggregation was important. In fact teams of super-forecasters could beat established prediction markets.

o   The note of caution around low performing teams came when people were lazy, let others do the work or where susceptible to group-think.

“Unchartered : How to map the future together.”

— Margaret Heffernan

Daryl Plummer of Gartner, a technology advisory firm who produces forecasts for customers who wish to discern hype from reality.

The prediction process starts with propositions, then verified, quantified and made actionable. A robust peer review occurs and 95% of predictions are modified along the way. Plummer routinely scrutinises predictions with actual events and these results are highlighted at conferences – championing the successes and sharing insights across those that were wrong. “Nobody here is hired because they’re psychic; they’re hired to generate insights that are useful – even if they turn out wrong. It’s useful to get you thinking”.

The author notes “that what matters most isn’t the predictions themselves but how we respond to them, and whether we respond to them at all. The forecast that stupefies isn’t helpful, but the one that provokes fresh thinking can be. The point of predictions should not be to surrender to them but to use them to broaden and map your conceptual, imaginative horizons. Don’t fall for them – challenge them.”

“How to Decide” : Annie Duke – Simple Tools for making better choices

The author presents some useful tips that teams can use to elicit uninfected feedback and leverage the true wisdom of the crowd in decision making. This is especially useful where key forecast & value chain insights and institutional knowledge is held across multiple SMEs and stakeholders;

The Problem;

• “When you tell someone what you think before hearing what they think, you can cause their opinion to bend towards yours, often times without them knowing it”,  “The only way somebody can know that they’re disagreeing with you is if they know what you think first. Keeping that to yourself when you elicit feedback makes it more likely that what they say is actually what they believe”, “To get high quality feedback it’s important to put the other person as closely as possible into the same state of knowledge that you were in at the time you made the decision”, “Belief contagion is particularly problematic in groups”

Tips to elicit those insightful cross-functional perspectives;

• Elicit initial opinions individually and independent before the group meets. Specify the type of feedback or insights required and request an email or written thoughts be provided before meeting. Collate these initial opinions and share with group prior to meeting. Now focus on areas of “diversion”, “dispersion”, avoid using any language around “disagreement”

• Anonymise feedback to group – this removes any influence from the insights or opinions of higher status individuals

• Anonymising feedback also gives equal weight to insights and opinion and allows outside-the box perspectives to be heard

• Anonymised feedback will also allow mis-understandings to be discussed and the team to grow in knowledge together

• If the team needs to make a decision within a meeting; try

  • Writing down insights and passing to one person to write on a whiteboard – maintaining anonymity

  • Writing down your insights and pass to another person to read aloud to the group

  • If you must read your own thoughts to group – start with most junior member and work towards most senior

“Radical Uncertainty: Decision Making for an unknowable future”

Authors: John Kay & Meryn King  

“The belief that mathematical reasoning is more rigorous and precise than verbal reasoning, which is thought to be susceptible to vagueness and ambiguity, is pervasive in economics”& Jean-Claude Trichet of the 2007-2008 GFC; “As a policy-maker during the crisis, I found the available models of limited help. In fact, I would go further: in the face of the crisis, we felt abandoned by conventional tools”

The authors draw a number of helpful lessons in the use of economic and financial models in business and in government;

• Use simple models and identify key factors that influence an assessment. Adding more and more elements to a model is to follow the mistaken belief that a model can describe the complexity of the real world. The better purpose for a model is to find “small world” problems which illuminate part of the large world radical uncertainty

• Having identified model parameters that are likely to make a significant difference to your assessment, go and do some research in the real world to obtain evidence on the value of these parameters to customers or stakeholders. Simple models provide flexibility to explore the effects of modifications or scenarios.

A model is useful only if the person using it recognises it does not represent the world as it is really is, rather it is a tool for exploring ways in which decisions might or might not go wrong. 

Uncertainty : Howard Marks : https://www.oaktreecapital.com/insights/howard-marks-memos/

In his May 2020 newsletter to Oaktree Clients, Howard Marks notes the field of economics is muddled and imprecise, there are no rules one can count on to consistently show causation, patterns tend to repeat, and while they may be historical, logical and often observed, they remain only tendencies. Excessive trust in forecasts is dangerous.

When considering current forecasts, he notes the world is more uncertain today than at any other time in our lifetimes, the ability to deal intelligently with uncertainty is one of the most important skills, the bigger the topic (world, economy. Markets, currencies, interest rates) the less possible it is to achieve superior knowledge and we should seek to understand the limitations of our foresights.  

A forecast is a statement about the future, a future we cannot know everything about , yet it remains a useful tool for decision making, scenario modelling, stress testing and planning. The map is not the territory, so with forecasting we should learn from better practices around collating diverse views and data, building cognitively diverse teams, constantly challenging assumptions, leverage the wisdom & insights of your subject matter experts, maintain intellectual humility & resiliency facing uncertainty, use models wisely and adopt a bayesian approach.

“No amount of sophistication is going to allay the fact that all your knowledge is about the past and all your decisions are about the future.”

— Ian Wilson. Former GE Chairman

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LOOKING TO CURATE YOUR BUSINESS STRATEGY? REACH OUT.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes.

We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

Article written by Mark Easdown

Linking transformation to strategy

In today’s business environment, transformation can take many forms but no matter the type it revolves around the need to generate new value - unlock new opportunities, drive new growth, deliver new efficiencies.

It is critical that the transformation project aligns to the company’s strategy – strategy is fundamental in guiding/aligning decisions and actions to ensure they support the achievement of the company’s strategic goals. A sound strategy helps shape an executable transformation objective.

The value that your transformation project will create/deliver must be aligned to your company strategy and it will help with articulating desired transformation outcomes, from a financial perspective or from an operational perspective.

Once you have aligned your transformation ambition you can build out your transformation program. 

THE STEPS

1. Clearly defined company strategy

2. Determine your company strategic priorities

3. Define your transformation ambition – ensure it aligns to your company strategy/strategic priorities

4. Get leaders involved

5. Build your transformation plan

6. Be clear on what success is

7. Gather resources and expertise

8. Choose the right enablers

9. Focus on culture and change management

10. Measure success

For more support on transformation please explore our range of thought leadership articles…

The Importance of Data Visualisation

Here at Whiteark, we love data, it’s at the centre of everything we do, it gives us that facts, and in order to interpret what the data is telling us, and communicating our findings with key stakeholders, data visualisation plays a fundamental role.

What is Data Visualization?

In today’s business environment, and the rise of big data upon us, we need to be able to interpret increasingly larger batches of data. Data visualization takes the raw data, models it, and delivers the data so that conclusions can be reached - it provides visual context of what the data/information means through the use of maps, graphs, tables, infographics or other visual formats. This makes data more natural for the human mind to comprehend and makes it easier to identify trends, patterns, and outliers within large data sets.

Users of Data Visualisation

Data visualisation is used across all industries to improve top line and bottom-line growth across all aspects of the organisation. As a crucial step in data analytics, data visualisation enables companies to unleash the power of their data by highlighting critical insights and messages that would otherwise be lost.

Benefits of Data Visualisation

The key benefit of data visualisation is the positive affect it has on a company’s decision making process – it enables businesses to recognise patterns more easily and faster. Below are some specific ways that companies can benefit from data visualisations:

Understanding Trends:

Analysing current and historical data allows companies to understand trends over a period - where they were and predict where they can potentially go. Applying data visualisation to this type of application is one of the most valuable.

Identifying Frequency:

Frequency is related to Trends Over Time but refers to the rate of particular instances/occurrences – i.e., understanding the frequency of customer purchases and at which point in the customer journey they make their purchase supports companies with predicting/planning different marketing and acquisition strategies for potential new customers.

Recognising Relationships:

Data visualisation simplifies identifying the correlations between the relationship of independent variables – this allows companies to make more informed/better business decisions.

Examining the Market:

Data visualization takes the information from different markets to give you insights into which audiences to focus your attention on and which ones to avoid. We get a clearer picture of the opportunities within those markets by displaying this data in visual representation.

Performance:

The ability to obtain real time information with data displayed clearly on a functional dashboard allows companies to act and respond swiftly. It helps leaders identify challenges/ areas for improvement and provokes decisions to pivot more quickly.

Assessing Risk and Reward:

Analysing value and risk metrics requires expertise because, without data visualization, we must interpret complicated spreadsheets and numbers. Once information is visualized, we can then pinpoint areas that may or may not require action.

Data Visualisation Techniques

There are a range of methods that can be used to distil data/information in a way that can be visualised. It’s important to understand the type of data being modelled and what its intended purpose is, before determining the most appropriate visual representation. Some visualisations are manually created, while others are automated. Below are some examples:

Infographics: infographics take an extensive collection of information and give you a comprehensive depiction. An infographic is excellent for exploring complex and highly subjective topics.

Heatmap: This is a graph with numerical data points highlighted in light, warm and dark colours to indicate whether the data is high-value or low-value.

Area chart: This chart is great for visualising the data’s time-series relationship.

Histogram: Histograms are used for measuring frequencies. These graphs show the distribution of numerical data using an automated data visualisation formula to display a range of values that can be easily interpreted.

Overall, data visualisation is important tool in today’s environment as it summarises a plethora of information in a way that makes it easier to identify patterns and trends, rather than looking through thousands of rows on a spreadsheet. The purpose of data analysis is to gain insights, and data is much more valuable when it is visualised as it simplifies communicating the findings to a broad range of audience groups.

Resilience

Article written by Mark Easdown

Individual, Enterprise & Ecosystem Strategy & Planning, Ways of Working

““The world breaks every one and afterward many are strong at the broken places.””

— Ernest Hemingway

““Resilience is the capacity of any entity – an individual, a community, an organisation, or a natural system – to prepare for disruptions, to recover from shocks and stresses, and to adapt and grow from a disruptive experience.””

— Judith Rodin

““Don’t seek for everything to happen as you wish it would, but rather wish that everything happens as it actually will-then your life will flow well.””

— Epictetus

“Kintsugi”: Kin meaning golden & tsugi meaning joinery, so “to join with gold”. In Zen aesthetics a different perspective emerges with broken ceramic pieces repaired using gold leaf and with great care thus highlighting the damaged history rather than hiding it. The object is given a fresh start, proudly wearing the flaws of its accident. Origins attributed to shogun of Japan,  Ashikaga Yoshimitsu (1358-1408)

According to the Oxford English & Australian Concise Oxford Dictionaries, resilience is a noun, with key attributes;

• Capacity to recovery quickly from difficulties, toughness

• Ability of a substance or object to spring back into shape, elasticity

• Recoiling, resuming original shape after bending, stretching, compression, shock, depression

Yet, the quotations above highlight a unique resilient frame of mind: “strong at the broken places” & “a fresh start, proudly wearing the flaws” & “don’t seek for everything to happen as you wish it would”. Judith Rodin believes “Resilience isn’t an inherited characteristic, it really is a skill” which would then enable you “to prepare for disruptions”.

Let’s explore some scenarios across individual resilience, ethical resilience & the resilience dividend.    

At the individual level, the global pandemic, economic downturns, recessions and increase in uncertainty and anxiety highlight the need for resilience. As Diane L Coutu “How Resilience Works”, (HBR May 2002) observes, resilient people have certain defining characteristics;

• They take a sober and down to earth look at the reality of the current situation

• They search for and construct meaning for themselves and others, they build bridges to a better and fuller future

• They continually improvise, they imagine new possibilities & put resources to new uses

Are resilient companies filled of optimistic people?  Jim Collins in researching “Good to Great” sought counsel of Admiral Jim Stockdale to learn more…

“You must never confuse faith that you prevail in the end – which you can never afford to lose – with the discipline to confront the most brutal facts of your current reality, whatever they might be”

Admiral Stockdale was a pilot whos’ plane was shot down over Vietnam in 1965, he endured 7 ½ years of captivity and torture and a POW. He organised a system of discipline & communications with fellow POWs, refusing even under torture to offer his captors any intelligence. He earned the Congressional Medal of Honour. He observed the POWs who broke fastest where the ones who deluded themselves about the reality and severity of their ordeal, they were optimistic they would be out by next week, next month, Christmas ..

The Stockdale Paradox, is that in the face of hardship you must;

• Maintain clarity about your reality  ….. however at the same time … Find positivity and hope for the future

In turning around demoralised workforce or lagging business performance, executives and teams must maintain a sober analysis of current state and conjure up a sense of possibilities and brighter future states.

Constructing meaning out of circumstance, continually improving and staying future focus

Austrian psychiatrist and Auschwitz survivor in his book “Man’s search for meaning” realised that to survive the camp, he created an imagine of himself delivering a lecture after the war on the psychology of the concentration camp to help others understand what they had been through, he constructed concrete goals and endured to deliver his vision.

In “Resilience: Hard won wisdom for a better life” by Eric Greitens, the story of Emil Zatopek shows us happiness and resilience can co-exist. In 1940 at age 18, he was forced by a coach at a Czech shoe factory to run his first race. Yet in adversity and during the race he discovered a love of running and a passion to succeed which set the direction of his life. Within 4 years he held Czech and world records. In the 1952 Olympics, he won the 5km and 10km and decided to run in his first marathon. He was an unorthodox runner, he wore his pleasure and pain for all to see, he crossed a line a winner in a world record time.

In our workplaces, mistakes are made, lack of frameworks and preparation, poor judgements and unintended consequences emerge. In “The Power of Ethics : How to make good choices in a complicated world”, Susan Liautaud gives us the following two real world examples and the need for frameworks around Ethical Resilience, the need for preventative measures, swift action and measures to recovery across leadership team and an organisation.

““Do the best you can until you know better. Then when you know better, do better””

— Maya Angelou

Natasha’s Law (UK) & Ethical Resilience

On July 17 2016, Natasha Ednan-Laperouse aged 15 boarded a plane at Heathrow with her father and best friend for a vacation in south of France, they stopped to buy breakfast at Pret A Manger. She meticulously examined food labels as he had allergies to nuts, sesame seeds, dairy & bananas, her father double checked the label and there were no warning signs around the store. Tragically Natasha suffers a severe anaphylactic shock, her medicines nor shots of epinephrine would assist, French paramedics rushed her to Nice hospital where she died.  

Sesame seeds had been baked into the dough of the baguette, this was not listed on the package nor visible on the bread. In September 2018, a coroner’s court found Pret A Porter have previously received 21 other instances of allergic reactions, 9 of which involved sesame seeds. Pret A Manager director or risk and compliance testified that the chain had acted in accordance to the law, highlighting differing labelling rules for food prepared in-store and off-site. So, the chain had adhered to food-labelling laws but fallen short of a higher ethical standard.

In October, CEO issued a public apology and instigated wide spread labelling of individual packaging, posted full ingredients online, promised to respond to allergy-related incidents and vowed to work with government, charities, peers to improve the law which emerged in 2019 was known as “Natasha’s law”.  

The CEO was asked by author what steps might have been taken to have built ethical resilience and recovery; his response acknowledged earlier labelling expense concerns, preparing food in-store was to deliver quality and freshness to customer, there had also been concerns about complexity in compliance and in-house labelling with many vulnerabilities and potential points of error in value chain. The CEO acknowledged they should have delivered more than the law required, they should have been proactive and once they saw missteps – they should have told the truth, taken responsibility and moved forward with a plan to recover.

Microsoft conversational AI bot called Tay ( T= Thinking, A=About, Y=You) & Ethical Resilience

In 2016, Microsoft launched a social experiment in Tay, with the intention that the more people chatted with Tay the smarter its learning and natural language would evolve. In less than 16 hours, a particular type of attack saw Tay posting thousands of racist, sexist and anti-semitic comments via Twitter.

Microsoft immediately deleted posts, took Tay offline and apologised for “unintended offensive and hurtful tweets .. which do not represent who we are or what we stand for, nor how we designed Tay”. The company acknowledged it had not anticipated this sort of attack, but should have and outline lessons learned moving forward and the complexity of managing positives and negatives of AI systems.

The author highlights the very public cycle from resilience to recovery; Tell the truth, take responsibility and have a framework and make a plan to fix the problem or flaws.

Trends emerging at the start of the 21st Century have highlighted many crisis; pandemics, cyber-security attacks, storm damage, wildfires, systematic and structural failures that impact communities, cities & ecosystems. These trends can be amplified by;

• movement of populations and urbanisation (stressing social cohesion, infrastructure and services) 

• complex adaptive & evolving systems, with both;

  • globalisation advancing and vulnerabilities for problems to spread quickly across the globe

  • climate change impacting fires, floods, storms & greenhouse gases

In response resilience is being studied across an ever-increasing landscape including: health & wellbeing, psychology, psychiatry, community & human development, change management & workplace, medicine, epidemiology, nursing, education, software and distributed systems, engineering. Infrastructure, economic development, environmental, leadership & strategy.

““In the twenty first century, building resilience is one of our most urgent social and economic issues because we live in a world that is defined by disruption. Not a month goes by that we don’t see some kind of disturbance to the normal flow of life.””

— Judith Rodin

In her book “The Resilience Dividend”, Judith Rodin describes Resilience noting the thinking of ecology, engineering, psychology, systems thinking and adaptive cycles.

“Resilience is the capacity of an entity – an individual, a community, an organisation, or a natural system – to prepare for disruptions, to recover from shocks and stresses and to adapt and grow from a disruptive experience. As you build resilience, therefore you become more able to respond to those you can’t predict or avoid. You also develop greater capacity to bounce back from a crisis, learn from it, and achieve revitalisation. Ideally, as you become more adept at managing disruption and skilled at resilience building, you will be able to create and take advantage of new opportunities in good times and bad. That is the resilience dividend”

So, what attributes might an individual, community or organisation develop to be more resilient ? 

• AWARENESS : must be aware of strengths, assets, liabilities, vulnerabilities, the infrastructure, human and natural systems and a willingness to constantly re-assess, take in new information and adjust settings

• DIVERSE: draw from a diversity not any core critical function (individual, organisation, community, capabilities, information sources, technical elements, people and ideas)

  • William Saito served as CTO of NAIIC and deeply involved in Fukushima power plant disaster with 2011 earthquake and tsunami. He maintains it was “group-think” that saw highly skilled and experienced engineers and administrators ignore warnings and place back-up generators in basement and susceptible to flooding.

• INTEGRATED: The left hands must know what the right hand is doing & have alignment of goals, across systems, sectors, divisional or government silos. It needs to presence of feedback loops.

• SELF REGULATING: these domains can withstand disruptions, anomalous situations and will not fail catastrophically. It is enhanced due to elements, planning or design

• ADAPTIVE: capacity to adjust to circumstances, taking new actions, modifying behaviours, making improvements even before s disruption to avoid or mitigate effects.

  • The Vietnamese communities living in public housing in New Orleans had social and community networks in place for their >5,000 people which meant that roughly 80% had left the city before Hurricane Katrina arrived. The community showed resilience and adaptability in emergency accommodation solutions and then in the return, re-build and re-establishing of church and community.

The author provides a large number of real-world examples of what good looks like spanning: Readiness, response and revitalisation (which is a much fuller forward experience than just recovery), the need to get ahead of the threats (what can be reinforced? What can be practiced?), coordinated leadership and well-trained resources,  acknowledging that a crisis will confound all plans and preparation and the importance of social cohesion – as friends, neighbours and colleagues are usually the first asked to respond.

The concept of resilience dividend has a dual meaning;

• It shows the difference between how a disruptive incident, shocks, stresses affects communities / ecosystems who have made reliant-related investments & those communities who did not

• Demonstrates the benefits to communities / ecosystems accrue such as jobs, social cohesion, infrastructure, equity , reduction of poverty and crime

Around the world, this co-benefit & resilience dividend is noted in the design of co-purposed infrastructure for example;

• Amphitheatre, Cedar Rapids, Iowa is both flood control and an entertainment space & community gardens.

• SMART Tunnel, Kuala Lumpur (SMART = Storm water Management and Road Tunnel) is a designed 3 section tunnel combining storm water flood drainage & motor vehicles on differing levels. In category 2 storms, which occur approximately 10 times pa, the tunnel transports both cars and flood waters in lower section. Whilst in category 3 storms, the road is closed and tunnel used for flood water flow.

Building resilience is key at the individual, enterprise and ethical levels. The resilience dividend is an important strategic concept.

In May 2018, the National Resilience Taskforce was established which sought to develop a national disaster mitigation framework to reduce the impact of disasters. A report emerged “Profiling Australia’s Vulnerability: The interconnected causes and effects of systematic disaster risk.  As the report notes on page 41, “ More focus is needed on the intersections & interdependencies in the systems that support us, from local to global levels”

““We need to remember that the future is not pre-determined in any important sense. It is not an unknown land into which we totter unsteadily one day at a time, but an extension of the present that we shape by our decisions and our actions. The future is not somewhere we are going but something we are creating. We all have a role in shaping Australia’s future.””

— Professor Ian Lowe

Source: https://www.aidr.org.au/media/6682/national-resilience-taskforce-profiling-australias-vulnerability.pdf

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LOOKING TO CURATE YOUR BUSINESS STRATEGY? REACH OUT.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes.

We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

Article written by Mark Easdown

Prospective Hindsight and the Pre-Mortem

Article written by Mark Easdown

Business Strategy, Leadership, Collaboration, Ways Of Thinking & Working

““We don’t rise to the level of our expectations, we fall to the level of our training.” - Greek lyrical poet, Archilochus.
Or restated: ‘you do not rise to the challenge, you fall to the level of preparedness’”

““If you want a man to keep his head when a crisis comes you must give him training before it comes” ”

— Seneca

““Hope for the best, plan for the worst” ”

— Lee Childs (Character Jack Reacher)

In a nutshell, What is Prospective hindsight?

It is the generation of an explanation, reason, narrative for a future event (as if it had already happened). As if one had taken a time machine forward and looked backwards.

A simple and effective example this shift in thinking is provided in the below 1989 study: ……. “ consider predicting the winner of the first basketball game of a championship series. Before the game predicting the winner is based on general factors: match-ups between key players, team strengths and weaknesses, etc. Even past games are used to identify factors relevant to the imminent contest. After the game it's a different story. The defeat of one team is explained both by these general factors and by specific events like Player A's early foul trouble Player B's 'off night', too much inactivity since the team won its previous series, etc. Such events are too numerous to anticipate beforehand and to relevant to ignore afterward.”

Your executive and team makes sense of its environment by observing what happens and reasoning why these things have happened. Your CFO or COO may have a deeper understanding of business drivers and processes and possess greater explanatory skills whilst your new recruit may generate a new fresh insight with less knowledge of the context.

We usually explain the past (why did this occur) and predict the future (what if scenarios). We analyse the past often to draw meaning and insights to apply to forward thinking. Strategically, it would be very beneficial if we could improve how we anticipate future events and help us make more successful decisions and next steps. 

Back to the Future : A Prospective Hindsight study, 1989

In 1989, Deborah Mitchell, Edward Russo and Nancy Pennington undertook a study: “Back to the Future: Temporal Perspective in the Explanation of Events”;  on how people think and what role does certainty play in people generating reasons, explanations, narratives about an event? If people generate more explanations about past events, is this because the event had happened in the past? Or because of the certainty with which people think about things in the past?  The experiment findings were;

• Certainty matters more than past of future in itself

• People who thought about a future event with certainty generated more reasons and explanations than those who considered a past event with uncertainty

• Adding certainty added 30% more reasons and twice as many action-based reasons than abstract reasons

“Winning Decisions, Getting it right the first time”, Russo & Shoemaker, 2002

An experiment found prospective hindsight generated 25% more reasons for the following questions;

“How likely is it a woman will be elected the leader of your country in the first election after the next one” Think about all the reasons why this might happen. For specificity, provide a numerical probability.

&

“Imagine that the first election after the next one has occurred and a woman has been elected the leader of your country. Think about the reasons why this might have occurred. Then provide a numerical probability of this actually occurring”

Given the importance and value of improving the decision-making process, researchers, social scientists and psychologists set about leveraging the findings of prospective hindsight studies and try to identify a framework upfront to identify your decisions that might lead to poor outcomes and create a safe environment for dissent in views. In 1992, Gary Klein, a cognitive psychologist developed a pre-mortem risk assessment approach.

The Pre-Mortem

The pre-mortem framework and strategy;

• Considers the reasons around why something might fail, enhances collective intelligence of the group

• Encourages prospective thinking (rather than retrospective thinking) , leverages findings of studies in field

• Consider upfront future events before a decision is made (things within your control and outside your control)

• Considers factors that have resulted in the failure of a project or initiative, all voices are equal

• Creates a safe environment for participants to utilise expertise, experience and intuition to aid decision making  

If you choose a multi-disciplinary and cross functional team of participants what will fall out of this process are valuable insights into weaknesses in current state business environment and processes, the new initiative and any integration concerns. This exploration of the initiative, the pre-mortem findings, the countermeasures proposed will also likely reveal the positivity and attitude of participants to the project. The process liberates participants to speak up whereas in other situations they would feel they were not seen as team-players.

The basic steps

Gary Klein suggests some basic steps;

• Bring together a diverse and informed team familiar with decision or initiative

• Imagine a worst-case scenario (embarrassing & devastating), Imagine a crystal ball good enough to see failure but not the reasons

• Ask team members to spend some time independently and silently generating reasons for the failure

• Collate and consolidate a comprehensive list of concerns and issues

• With a prospective viewpoint, the team is now able to reconsider plan/initiative and countermeasures

• Keep revisiting the list, which keeps the possibility of failure alive and reduces overconfidence or group-think   

It is not the steps followed, the importance of pre-mortems is in the ability to switch thinking and the prospective hindsight viewpoint. 

Daniel Kahneman (2002, Nobel prize winner and expert in judgement and decision making) describes a simpler version;

…. When the organisation has almost come to an important decision but has not formally committed itself, Klein proposes gathering a brief group of individuals who are knowledgeable about the decision. The premise of the session is a short speech: “Imagine that we are a year into the future. We implemented the plan as it now exists. The outcome was a disaster. Please take 5 to 10 minutes to write a brief history of that disaster”

In which domains might pre-mortems be valuable?

Program and Project Management

• Ongoing risk analysis, risk mitigation measures, addressing weaknesses and integration issues

• Improving structural integrity of initiative and identify opportunities, quicker responses through project lifecycle

• Pre-emptively, in any domain that a “Post Implementation review” or “Post Mortem” is undertaken

Product Development and launch

• Workshop 6-month ahead scenarios ; “Product failed to launch”, “Product failed to deliver”

• Flawed beliefs may emerge, may be an alternate way to deal with ambiguity, highlight potential failure points, enhances greater collective awareness

• With findings run mini experiments on pilot, devise risk mitigation and test app, take small bets, perhaps UX professionals can de-risk initiative

Investment Opportunities

• Mitigate group-think, ensure a sufficient range of alternative model input assumptions, approaches and viewpoints considered, enhance investment business case, mitigate downside risks, poor practices and avoid making material mistakes, record findings and revisit frequently

Strategy, Resilience and Risk Management

• Workshop “Kill the company” or “Kill the budget” or “Kill the forecast”, “Risk Management: BCP, DR, Contingency Planning” identify ways in which these could fail, identify the challenges, points of failure, assumptions and develop mitigation plans

• Complement a HAZOP; Hazard and Operability Study to see how system and plant deviate from design intent and may create risks to manage 

• Workshop new strategic partnership proposal covering pricing, inventory, distribution, commercial size and acumen of partner, mutual ways of working

• Strategic planning tool for innovation and risks for domains such as : environmental, social, ethical, economic or empowerment

So, is this pre-mortem just another to-do list or a glass half empty view of the world?

Certainly, throughout history success has derived through good mental models, pre-empting and avoiding mistakes, inverted and switch thinking and leveraging prospective hindsight;

““... prevention is worth a pound of cure” ”

— Benjamin Franklin

““The impediment to action advances action. What stands in the way becomes the way””

— Marcus Aurelius

““When I begin my work in the morning, I expect to have a successful and pleasant day of it, but at the same time I prepare myself to hear that one of our school buildings is on fire, or has burned, or that some disagreeable accident had occurred, or that someone has abused me in a public address or a printed article, for something that I have done or omitted to do, or something that he had heard that I had said—probably something I had never thought of saying.””

— Booker T Washington

““Invert, always invert: Turn a situation or problem upside down. Look at it backward. What happens if all our plans go wrong? Where don’t we want to go, and how do you get there? Instead of looking for success, make a list of how to fail instead–through sloth, envy, resentment, self-pity, entitlement, all the mental habits of self-defeat. Avoid these qualities and you will succeed. Tell me where I’m going to die so I don’t go there.” ”

— Charlie Munger (Berkshire Hathaway)

Pre-Mortems might be a useful tool business hack that could take as little as 30-90 minutes or multiple sessions, perhaps it might be your unfair advantage, your “low-cost and high-payoff kind of thing” (see below).

https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/strategic-decisions-when-can-you-trust-your-gut

Gary Klein: “The premortem technique is a sneaky way to get people to do contrarian, devil’s advocate thinking without encountering resistance. “

Daniel Kahneman: “The premortem is a great idea…  in general, doing a premortem on a plan that is about to be adopted won’t cause it to be abandoned. But it will probably be tweaked in ways that everybody will recognize as beneficial. So, the premortem is a low-cost, high-payoff kind of thing.

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LOOKING TO CURATE YOUR BUSINESS STRATEGY? REACH OUT.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes.

We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

Article written by Mark Easdown

Practical Wisdom: Making sense of the eco-system

Article written by Mark Easdown

Business Strategy, Leadership, Collaboration, Ways Of Thinking & Working

““It doesn’t matter how beautiful your theory is, it doesn’t matter how smart you are. If it doesn’t agree with experiment, it’s wrong.””

— Richard Feynman

““Without this texture of experience, the data shoved before these executives’ eyes loses any truth. Context and colour are absent; all that remains are abstract representations of the world rather than the world itself.””

— Christian Madsbjerg, Sensemaking

““Practical wisdom,” Aristotle told us, “is the combination of moral will and moral skill.””

— Barry Schwartz

What is it when you encountered an executive team, your boss, a colleague, a team member, a peer displaying these following characteristics;

• Understanding the context, the enterprise strategy and how to serve the common good

• A balancing of conflicting directives, interpretation of rules in light of the situation

• Perception, sharing others views, see the shades of grey, can apply practical solutions to particular problems

• Does the right thing because it was the right thing to do, with the interest of the common good in front of mind

• Applies wisdom, knowledge and experience, learnings from previous mistakes to a specific context

 It is Practical Wisdom in action…

Aristotle (384-322 BC) in the Nicomachean Ethics distinguishes between three types of knowledge:

• Episteme (universal, theoretical understanding),

• Techne (skill, craft, technique understanding)

• Phronesis (practical wisdom, prudence, ethical knowledge, rational, linked to the senses, to perceive, to deliberate and action orientated).

  • His basic ingredients of Practical Wisdom were: Knowing one’s role or objective, perception of particular situations, an informed intelligence, learning from experience, deliberation on the best course of action, it is not enough just to be wise, you must actually do it. 

  • Practical Wisdom has evolved through time with the writings of Thomas Aquinas and many modern-day scholars, thought leaders and business schools.

So, Why (Where) is Practical Wisdom still relevant and of interest today?

Practical Wisdom within law-making

In 2019, the final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry was handed down by Commissioner Kenneth Hayne. The report underscores many fundamental themes;

• Importance of boards getting the right information and challenging management (yet adds the caution:  “Often, improving the quality of information given to boards will require giving directors less material”)

• A call to arms to fix corporate culture (assess culture and governance, identify problems, deal effectively with problems, set the tone from the top, ensure ongoing and robust reviews)

• Remuneration and Incentives tell staff what the company values

• Best interests of a company is not a binary choice between the customer and shareholders

Commissioner Hayne offered the following practical wisdom/principles to guide a review of ethics and conduct for boards and business leaders;

• Obey the law

• Do not mislead or deceive

• Be fair

• Provide services that are fit for purpose

• Deliver services with reasonable care and skill

• When acting for another, act in the best interests of that other

Practical Wisdom and the role of leaders

Wisdom, knowledge and experience are required for leadership and managerial decision making in; goal setting and an integrated view (including an ethical, moral and societal view), pricing policies (fair & equitable outcomes, supporting strategy (grounded in data plus context), budgeting (dealing with uncertainty, unpredictability, models and assumptions), leading through crisis (need for eco-system thinking) staff wellbeing ( the individual needs and the common good), strategic partnership balanced scorecards (ability to see through conflicting scores at what is really important in relationship).

Leadership should not wait for a crisis, for revenues and budgets to go off-track to engage the wider views. Pandemic of 2020, has been a great example of leadership teams who have been forced to stop, listen and reach out across their ecosystem (customers, employees, suppliers, relationships with banks and government) and to re-invent and re-imagine themselves.

Often when things start going wrong, there is an inclination is to either make more rules to prevent certain outcomes occurring or to put in smarter incentives to encourage the right outcomes. Practical Wisdom can be a guide when many conflicting rules appear at odds with the underlying principle & enterprise strategy  (see Starbucks example).

https://www.reutersevents.com/sustainability/comment-what-aristotle-and-confucius-can-teach-todays-csr-professionals

““The problem with a rule-book based approach is that it actively undermines practical wisdom. When people become used to complying with policies, they stop thinking for themselves. This is probably in part behind the terrible incident at a Starbucks in Philadelphia when a manager called the police to remove two black men. Racism was clearly a factor, but the incident began when the manager refused to allow one of the men to use the restroom, in accordance with company policy that they were for customers only. Had the manager followed the principle of hospitality, which should be at the heart of the coffee chain’s ethos, rather than one of its policies, the situation would probably not have escalated””

Practical Wisdom and desirable characteristics of individuals and teams 

How might your organisation better consider virtues and practical wisdom in the recruitment of individuals, the building and binding of teams, project sprints or cross functional collaborations?

Practical wisdom would be demonstrated in the masterful blending of knowledge and experience, an understanding of both the specific context of a situation and a wider more integrated perspective, wisdom and action. The ability of individuals and teams to  work for the common good and do the right thing at the correct time because it is the right thing to do, suggests a balance: a challenge of group-think and dominant assumptions, awareness of limitations and willingness to seek inspiration externally, ensure cognitive diversity and balance creativity/breaking through thinking with obedience to rules and resistance to change.

Yet, nurturing practical wisdom may even appear add odds with our enterprises and societies which are becoming more complex and interconnected, more specialised, more bureaucratic with rules, regulations and letter of the law compliance focus. It is balance to be found for each sector and enterprise (see Timpson example).

https://www.reutersevents.com/sustainability/comment-what-aristotle-and-confucius-can-teach-todays-csr-professionals

“UK key-cutting and shoe-repair chain Timpson; “Under founder John Timpson’s principle of “upside down management”, all staff are authorized to do whatever they judge is necessary to give the customer the best experience. This empowers everyone in the organization to think about how to do the right thing on a daily basis and never hide behind the policy book. The company does have some specific policies, too, but these reinforce rather than replace the emphasis on principle.””

Practical Wisdom and thinking about data and analysis

In 1973, Clifford Geertz, an anthropologist characterised his field notes and data as a “thick description” which was a multi-faceted examination of human behaviour (facts) plus how it related to the deeper cultural context. The aim was to observe, record, analyse and interpret a “thick description” to gain a deeper understanding and meaning.

Practical wisdom may be applied to your data in the steps you take to understand the enterprise strategy and desired outcomes (What do you want to achieve? Be direct and specific), How you engage across business to understand the source of data, cost/benefit and data integrity, whether any recent material changes in technology, enterprise practices, calculation or collection of time series of data. A constant reflection on choosing meaningful metrics, ask yourself “how do I know that” and “why is that important?”. The willingness to sense-check data analysis with subject matter experts, review lessons learned from prior errors, periods or external eco-system or industry benchmarks.

https://www.marketingweek.com/adidas-marketing-effectiveness/

““Adidas is on a journey to shift from marketing efficiency to marketing effectiveness, admitting a focus on ROI led it to over-invest in digital and performance marketing at the expense of brand building.” ….
Wrong metrics “ led Adidas to over-invest in paid search ….. an error it uncovered in its Latin America market when a breakdown at Google AdWords and therefore inability to invest in paid search didn’t lead to a dip in traffic or revenue coming from SEO.””

The purpose of an enterprise is evolving rapidly and is no longer just to “maximise shareholder value” declared the Business Roundtable in 2019. In 2020 CEO Larry Fink of Blackrock informed clients of a new ESG standard: “making sustainability integral to the way we manage risk, generate alpha, build portfolios, and pursue investment stewardship, in order to help improve your investment outcomes”. In 2020, the Pandemic forced business to re-examine and re-imagine themselves. As these trends continue there is a need for something fresh and new (or perhaps revisit something rather old).

Practical Wisdom; making sense of the eco-system is a “secret sauce” for individuals, teams , management and enterprise. As a way’s of working and thinking, it remains highly relevant today. Read deeply, reflect, listen, build cognitively diverse teams, collaborate and play it forward. Whiteark is here to assist.

“ “Virtue makes us aim at the right end, and practical wisdom makes us take the right means””

— Aristotle

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LOOKING TO CURATE YOUR BUSINESS STRATEGY? REACH OUT.

Whiteark is not your average consulting firm, we have first-hand experience in delivering transformation programs for private equity and other organisations with a focus on people just as much as financial outcomes.

We understand that execution is the hardest part, and so we roll our sleeves up and work with you to ensure we can deliver the required outcomes for the business. Our co-founders have a combined experience of over 50 years’ working as Executives in organisations delivering outcomes for shareholders. Reach out for a no obligation conversation on how we can help you. Contact us on whiteark@whiteark.com.au

Article written by Mark Easdown

The challenge has been laid to develop a Supply Chain Strategy that supports Australia’s renewed obsession with lifestyle

Article written by Matthew Webber

The way that we buy, move and sell Is shifting in seismic proportions. We have had all the indicators within our radar for some  – the uptake of ecommerce as a legitimate and safe platform for retail shopping, geo political trade wars playing out between large, industrialised nations and emerging nations along with increase consumer insistence on visibility and ethical sourcing practices. In amongst that we have had significant environmental impacts such as fires that have wiped out communities along with floods that have isolated regions.

“Insights from Matthew Webber | Matthew Webber is a specialist in strategy, program delivery and training, focused on driving business performance by developing commercial, operational and innovation capability. With over twenty years international experience, Matthew has worked across the globe with organisations undergoing immense change and comprehensive transformations. Inspired to create a world championed by kindness, where equitable opportunity is available for all - Matthew shares his vision through best-selling books and his sought-after keynotes. ”

Australian Supply Chains continue to be impacted by global events – necessitating a rethink of the sovereignty of our Supply Chains

Only in the last week have we seen how truly volatile our global supply chain networks are with the blocking of the Suez Canal by the Evergreen Cargo Ship ‘MV Ever Given’ in an unfortunate accident as the result of a sandstorm -  potentially blocking up to 15% of global trade as goods need to pass between Asia and Europe. The question my Australian reading audience may ask, what would the Asia- Europe trade lane between have to do with Australian trade – and the answer is a lot. For a start, ports will become congested – the same ports that need to unload Australian export cargo, capacity will be stripped from the shipping market driving prices up, supply will be interrupted for manufacturing and oil prices will be driven up. That is just the start. This is one ship that has interrupted a global economy and it impacts your business, your people and your customers

Then of course we have had COVID-19. I reluctantly bring up the pandemic – because it is not the only issue of our times – yet it is so big – we cannot ignore to comment and acknowledge the shift that it will have in our psychology as a nation. Not to dissimilar to a war period – we are seeing fundamental shifts in our attitudes and behaviours – not just as a market, but as a people.  The pandemic has been an ongoing issue for the global economy for well over a year now. The reactions, repositioning and rethinking of supply chains has been considerable

These are obvious impacts that have been impacting and shaping our supply chain strategies. For some organisations this has provided significant opportunity as they have created new business models or adapted exiting ones to suit. For other businesses, they have been slow to respond, and as a result have been lagging behind – and sadly for some the slow response has resulted in their demise. For those that have been fast to react – there is a chance that the successes may be short lived unless we start unpacking what is actually happening to the psychology, behaviour and ambitions of our nation.  

“What does a Post Pandemic Australia look like?

On Wednesday 24th March 2021, I had the wonderful fortune of attending a Whiteark event where Bernard Salt, leading Demographer and commentator, presented a fascinating and insightful talk on the ‘Post Pandemic Australia: What we can expect’ .”

Bernard’s discussion of course was validating many of the impacts that global disruption has had on supply chains, and Bernard himself has publicly spoken about the opportunity to rethink our global supply chains and consider carefully the need to make our Supply Chains more sovereign. Put simply – the global environment is too volatile not to protect the key manufacturing capability and product availability of key necessities for the welfare of our nation –from a healthcare, security or economic perspective. This philosophy cascades to an organisational level where our organisations need to rethink the sovereignty of their supply chain and have key and strategic lines available and protected from global disruption – like we have seen in the pandemic, the Suez canal incident or more broadly many of the global economic disruptions from moving from an industrialised era to a digitised one.

Of course, though, Bernard Salt challenged my thinking further on the topic of Supply Chain strategy – beyond the obvious. Bernard’s discussion was focussed deeply on the psychology and aspirations of everyday Australian’s. And the theme, and label, that kept recurring was that of Lifestyle. As Australian’s we are obsessed with lifestyle – and the centre of gravity for our lifestyle rests in our home. This obsession has only renewed.

Supply chains need to be geared towards a lifestyle obsessed Australia

What all of these disruptions have done, particularly the major disruption of the pandemic, has reinforced how important lifestyle is to everyday Australians. The pandemic – for all of its pain – has brought with it an opportunity for us to reconnect with our neighbours friends and families. It has allowed us to spend more time in our homes. It has for many cut the daily commute by hours – time that can be spent connecting and enjoying the lifestyle and balance we so desire. Our attitudes to the way that we work have fundamentally been tipped upside down, as we revert to our natural desire of seeking a better lifestyle for our families.

What does this mean – what does it mean for our cities, for our suburbs, for our regional centres. Simply – our suburbs and our regional centres will be activated. The way that we work, the way that we engage, the way that we shop – will fundamentally shift. Not only do we now have some ‘more mature’ age consumers adopting ecommerce, but we also have whole generations behind us (such as the ‘Millenials’ that will up the imperative on placing value on experience and lifestyle even further. Our homes have, and will continue to become, bigger – and who would have thought that now a home office – or ‘zoom’ room would be a required feature of any home.

You may be rightfully asking, what does this have to do with my Supply Chain? The answer is a great deal. If we understand the psychology, behaviours and what ordinary Australian’s value, we can design and build our supply chains to support.

The way that we buy, move and sell will fundamentally shift as Australians adopt to their reinvigorated obsession with lifestyle. Our supply chains will need to be established to support the reactivation of suburbia and provincial Australia. If your supply chain does not directly serve these Australians – it will most certainly need to be supporting the businesses that do.

Our commuting, social, work and leisure activities have fundamentally returned us to be being closer to home – in close proximity to the things that matter to us most – our families, friend and our homes.

You supply chain needs to adapt to the reinvigorated obsession of Australians to their love of lifestyle. Your supply chain will need to be fast, accessible, sovereign and support the new behaviours and attitudes of everyday Australians – the everyday Australians that will be spending their leisure and work time at home or very near to home – and not at shopping centres, high streets, city offices or stuck in traffic on the daily commute.

How is your Supply Chain supporting Australia’s renewed obsession with lifestyle and connection?

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LOOKING TO rethink your Supply Chain? REACH OUT.

Our leadership team at Whiteark  have decades of experience in leading Supply Chain Transformations from Factory through to Customer, developing Market and Customer strategies that ensure relevance and desirability . We design the business model to deliver commercial feasibility and  to ensure that your business is ready to not only deal with disruption, but to thrive in it. From strategy to design and execution. Contact us on whiteark@whiteark.com.au or explore our supply chain transformation services here.

Article written by Matthew Webber

Put your hat on and get ready to problem solve with your team?

The Six Thinking Hat technique is used in companies around the world to facilitate decision making and getting people to have good brainstorming conversations.

Before you start you need to educate your team on the 6 hats and background. You can do this by:

• Reading our hats articles

• Watching our Hats video

• Download our free Powerpoint template

Group Exercise

Pick a problem to solve with the team/ group. 

Allocate a hat to each person; the point isn’t to put people to the natural hat but make people outside of their comfort zone and ensure it creates good conversation.

Teams can use these hats in any order during a discussion, but typically progress from blue, to white, to green, to yellow, to red, and finally to black.

This order organizes the discussion:

• Blue: Start with the approach and process

• White: Review the facts

• Green: Generate new ideas without judgement

• Yellow: Focus on the benefits

• Red: Consider emotional responses to any ideas

• Black: Apply critical thinking after the benefits have been explored to test the viability of the new ideas

Any hat could make a reappearance in the discussion. For example, after facts (white) are laid out, more process (blue) may be applied, or after pros (yellow) and cons (black) are discussed, new ideas (green) may surface.

Using these hats takes some practice. Remember that this approach is not intended to "feel natural" at first. It is intended to help individuals focus on problem solving. Practice, however, can help the team flow through the hats more easily, and gives everyone in the organization a shorthand to focus on the analysis rather than their complicated thoughts and responses to the process.

 

Tips

Here are a few tips for running a “Six Hats” meeting:

• Empower a moderator (a designated blue hat) who has read de Bono’s book beforehand to set an agenda and facilitate the meeting.

• Use six physical hats of different colours (or labelled with the different roles) to remind participants of the different thinking categories and signal what category is the current focus.

• Ensure that participants all have a way to record ideas, either for brainstorming, or to save for when the conversation moves to the appropriate hat.

For more practical examples of how this works please follow us on LinkedIn and YouTube for some Whiteark bites that provide some practical examples.

Need more information on the hats?

Watch the videos below where Jo Hands and James Ciuffetelli unpack each of DeBono’s hats in less than 5 minutes…

Whiteark is aligned with the White Hat.
Let us explain more….

We’re a team of doers led by Jo Hands and James Ciuffetelli. We don’t believe in unnecessary layers; and between us we have over 50 years of collective experience, expertise and global connections. Delicately weaving these together, we engage with you directly, with a single-minded focus on the task at hand. Collaborating at a senior level to propel organisations forward, we intricately map out and execute your next move, ensuring you’re prepared, protected and prosperous.

We’re nimble; we will assemble the best team for your problem, guaranteeing you have the skillset and people you need - no more, no less. Using data (de Bono’s White Hat) we load up your arsenal with the information needed to define and craft your next move; your strategy. Then together we’ll use this knowledge to carve out a unique set of priorities and objectives, bringing the entire team into the fold so they’re aligned towards the same targets and goal.

Supply Chain Transformation Leadership in Action

Article written by Matthew Webber

One of the key attributes for any prosperous supply chain of the modern era is to have the ability to adapt and respond. We can design our supply chains structurally, and technically, to deliver on this outcome, however we do have to move our supply chains from where they are today, to where they need to be in the future.  We need to do that through leading our people, our partners and our communities in which we operate.

“Insights from Matthew Webber | Matthew Webber is a specialist in strategy, program delivery and training, focused on driving business performance by developing commercial, operational and innovation capability. With over twenty years international experience, Matthew has worked across the globe with organisations undergoing immense change and comprehensive transformations. Inspired to create a world championed by kindness, where equitable opportunity is available for all - Matthew shares his vision through best-selling books and his sought-after keynotes. ”

We are in effect leading our supply chains to be change ready. Being change ready is a question of culture, and culture needs to be led.

Change is difficult at the best of times, but when you are trying to change a global supply chain with multiple interested parties, suppliers and communities the need to  be omnipresent and lead through action is telling.

The key actions required by a supply chain leader when navigating transformative challenges are to:

• Lead the vision

• Build confidence

• Empower people

• Communicate effectively

• Build the right team

Now let’s take a closer look at how to go about this.

Lead the vision

Leaders will be very good at finding the common thread that connects people to a mission or a cause.

Great supply chain leaders will be able to share a vision across the entire supply chain. They will also respect different cultures (geographical, industry, organisational) and needs within their supply chain community and embrace the differences as an advantage.

Given that the vision will cross so many organisation and cultural boundaries, it needs to be stated in a way that provides both brevity and clarity, and something that is able to be understood at all levels, in all organisations, in all geographies.

The vision must state where it is that you are going, why you are going there and importantly what are the key steps that need to be undertaken in getting there.

The collective vision will be a powerful foundation for all parties in your supply chain to engage with and provide as a beacon when making difficult decisions or provide guidance when confronted with difficult challenges.

If your vision is not a collective vision and does not value the contribution that all your stakeholders make to your supply chain, it will be very difficult to harmonise towards a common goal.

Build confidence

We can almost become fatigued by the disruption that impacts our supply chains – bushfires, pandemics, new systems, new ways of working, change in governments and policy – the list, as you are aware, goes on. We need to build confidence, and resilience,  for our people to be able to face into each challenge as they arise. Being challenge ready and having the tools and support available to address the challenges is part of the solution.

People need to believe that the change is realistic and will create value. How many times has something been promised but not delivered? Where is the plan? How is it going to be resourced? Where does it start? How long will it take? What does it mean for me? Have they considered my situation? These are just some of the conscious and subconscious thoughts that could be going through people’s (as well as suppliers, service providers and communities) minds.

People gain confidence from wins, but those wins must not be rhetoric – they must be real wins that can be measured and are meaningful. Supply Chains can be big moving beasts, so being able to break it down into meaningful parts to create many small wins that support a broader, strategic intent is important.

And of course, believing that change and value creation can be sustained will provide confidence. You need to demonstrate that a new process, business model, distribution or manufacturing technique can survive past the initial implementation phase. You must measure, and be able to communicate, your ability to sustain an initiative.

Empower your people

Empowerment in your supply chain is about making sure the people, the communities, your partners are equipped and enabled to deliver their part of the value. We need to show support, provide the tools and training and create the space for this empowerment to occur. They need the capacity, competence and confidence in what they are being asked to deliver.

We also have to think about how teams in different environments and cultures learn and operate. For instance, a development program in one organisation, in one country may not be the most appropriate as in another organisation or another country.

It is important that everybody in the supply chain is empowered and equipped with the right tools, methods and mindsets to be able to cope with the change that is upon us. We not only need this capability, but we also need resilience so that when times are tough or we are under pressure, we actually have the capacity and capability to deal with the challenge without sacrificing our commitment to value creation.

Communicate, communicate, communicate

There is a lot of communication noise out there. Think of all the news services, all the work emails, all the social media – we are completely saturated by information and it is very difficult just to absorb everything, let alone understand it. So now let’s think about that in a Global Supply Chain context – with all the various parties and stakeholders, and all the moving parts, it can be overwhelming to say the least, and communications are in danger of becoming just a lot of meaningless noise.

You have to be able to cut through that noise so that your messages can be received and understood. This is why it is absolutely critical to have a consistent, systematic and deliberate routine for communicating valuable and meaningful information.

The words used, how they are said, and the tone used are very important in a global setting. You really need to ensure that you adjust your communications to suit the local situation – and you should do this with the support of the local teams. You also need to have systems in place that ensure that communications are received and understood and are in fact interpreted correctly.

Build the right team

For any business, the only real competitive advantage is people. While process, the way a business is organised, how resources are used, or how goods and services are marketed are all contributors to competitive advantage, they actually arise because of the people.

We can see that if we have people that are not culturally, or perhaps philosophically, aligned that it will slow down the transformation effort. 

This must be a collective effort, and you must take necessary efforts and steps to ensure that the people operating in this setting are safe and have the right support and structure around them to help them be a success. 

Your team extends beyond just your organisation – it reaches into the collective team of your partners and the communities you operate in.

We need to be able to link the supply chain through people and engagement – after all it is the people that will make our supply chains operate effectively and deliver value.

A common mistake that is made in the transformative efforts of supply chains is that they focus solely on the structural, or technical, elements of the supply chain. The biggest transformative failure comes when we do not consider the change readiness or capability of our people, partners and communities. Transformation in our supply chains must be led, and it must be led through action.

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LOOKING TO rethink your Supply Chain? REACH OUT.

Our leadership team at Whiteark  have decades of experience in leading Supply Chain Transformations from Factory through to Customer, developing Market and Customer strategies that ensure relevance and desirability . We design the business model to deliver commercial feasibility and  to ensure that your business is ready to not only deal with disruption, but to thrive in it. From strategy to design and execution. Contact us on whiteark@whiteark.com.au or explore our supply chain transformation services here.

Article written by Matthew Webber

What hat are you naturally and what hat is outside your comfort zone?

Following on from our thought leadership article on “What hat you wear can change the game - are you ready to play?”  here we unpack the six different hats in more detail, and explain the pros and cons in a little more detail.

As you are reading through these descriptions you should consider:

• In a meeting what hat is my default?

• What default hats do I have on my leadership team?

• What hats are missing from my leadership team?

The White Thinking Hat 

The white hat is like a detective who gathers, organizes, analyzes, and presents current information. As detectives gather clues and facts, they remain neutral and unbiased to avoid jumping to conclusions based on single bits of information. Instead, all clues, facts, and evidence must be analyzed and weighed to see what they have and what is missing. 

In the same fashion, while “wearing” a white thinking hat, you should collect known information and analyse it to reach fact-based solutions. Analysis of the gathered data will help you find gaps so you can look for ways to fill them or at least take note of them so you have a better idea of how to direct your conversations. 

Start gathering facts and data based on these problem-solving questions:

• What do we know about this issue?

• What don’t we know about this issue?

• What can we learn from this situation?

• What information do we need to solve this problem?

• Are there potential existing solutions that we can use to solve this problem?

Work through these questions as a team to gather more information as each person shares their unique knowledge of a particular issue or problem.  

The Yellow Thinking Hat

This hat represents enthusiasm and optimism. Like a bright, sunny day, the yellow hat is used to bring positive energy and life to every idea.

With the yellow thinking hat, you seek to find the benefits and value of ideas. You should not be hampered by limitations or boundaries, but rather believe that when there’s a will, there’s a way. 

Yellow hat questions could include:

• What is the best way to approach the problem?

• What can we do to make this work?

• What are the long-term benefits of this action?

These questions are only a starting point. As you work through your Six Thinking Hats exercises, you may want to come up with more questions that take into account the optimistic role of the yellow hat.

The Black Thinking Hat

The black hat is the opposite of the yellow hat and represents judgment. Wearers of this hat look for ways that the situation can go wrong.

The black hat is used to expose flaws, weaknesses, and possible dangers of proposed ideas. On the surface, the ideas you got from the yellow hat session may seem perfect. The black hat dives below the surface to find any potential problems. The black hat is essential to keep you from jumping headfirst into a potentially disastrous situation. However, the black hat’s role is not just to sit around and be all judgy. In addition, this role looks for and identifies resources that may be needed to accomplish your goals.

Questions to help you think from the black hat perspective can include:

• How will this idea likely fail?

• What is this idea’s fatal flaw?

• What are the potential risks and consequences?

• Do we have the resources, skills, and ability to make this work?

The Red Thinking Hat

While you have the red thinking hat on, your primary goal is to intuitively suggest proposals and plans of action based on feelings and hunches. This hat is open-minded and non-judgmental. Using the information gathered from feelings and emotions, you should be able to intuitively relate these feelings to the problem you are trying to solve.

A red hat thinker’s objectives include:

• Make intuitive insights known.

• Seek out your team’s hunches and feelings.

• Reveal an idea’s hidden strengths.

• Use instinct to identify potential weaknesses.

• Find internal conflicts.

For example, some ideas and plans may seem weak or impractical but if someone wearing the red hat can identify a new idea or plan that “feels” right, this idea should open up discussion and exploration of additional opportunities you may never have considered.

Red thinking hat questions may include:

• What is my gut feeling about this solution?

• Based on feelings, is there another way to fix this problem?

• What are our feelings about the choice we are making?

• Does our intuition tell us this is the right solution?

The Green Thinking Hat

Green hats are used for creative thinking. Wearing this hat lets you think outside the box to explore more possibilities and bend the rules of problem-solving. This creative thinking should be free from judgment and criticism. 

Because the green hat is not bound by rules or limitations, this is where you can think beyond the norms of reality. The green hat lets you conduct a brainstorming session where no idea is too wild or crazy to be noted or immediately shot down. The green hat must refrain from criticizing or judging any ideas or suggestions that come up. The idea is to expand your thinking as you explore possible solutions.

The green hat may ask questions such as:

• Do alternative possibilities exist?

• Can we do this another way?

• How can we look at this problem from other perspectives?

• How do we think outside the box?

Keep in mind that as you work with the green thinking hat, you are free to express any idea that comes to mind. Even ideas that may sound crazy can have a kernel of feasibility that can put you on the right path to solving your problem. 

The Blue Thinking Hat

This hat provides a management role and will help you analyse the situation. When wearing the blue hat, your job is to manage the thinking of the other hats to ensure that the team stays focused and works more efficiently toward a workable solution. The role makes sure the other hats are being used correctly. 

Specifically, the blue hat seeks to:

• Efficiently and effectively improve the thinking process.

• Ask the right questions that help you direct and focus your thinking.

• Maintain and manage agendas, rules, goals, and tasks.

• Organise ideas and proposals, and draw up action plans.

Questions that will help you in the blue hat role may include:

• What is the problem?

• How do we define the problem?

• What is our goal and desired outcome?

• What will we achieve by solving the problem?

• What is the best method for going forward?

It's something new. You might have heard about it but haven't applied it in your workplace. It's a challenge for the year ahead to use this to better engage with your team and get different perspectives for effective brainstorming.

If you are interested in a powerpoint template that can use used to educate your team on the 6 hats please sign up here.

If you’re looking for some help to navigate workshops using DeBono’s Six Thinking Hats, then reach out to the Whiteark team.

How we use the hats with our clients

We’re a team of doers led by Jo Hands and James Ciuffetelli. We don’t believe in unnecessary layers; and between us we have over 50 years of collective experience, expertise and global connections. Delicately weaving these together, we engage with you directly, with a single-minded focus on the task at hand. Collaborating at a senior level to propel organisations forward, we intricately map out and execute your next move, ensuring you’re prepared, protected and prosperous.

We’re nimble; we will assemble the best team for your problem, guaranteeing you have the skillset and people you need - no more, no less. Using data (de Bono’s White Hat) we load up your arsenal with the information needed to define and craft your next move; your strategy. Then together we’ll use this knowledge to carve out a unique set of priorities and objectives, bringing the entire team into the fold so they’re aligned towards the same targets and goal.