In the last two posts, I’ve presented an analysis of the makeup of executive leadership teams in the FTSE 100, then suggested some new roles that might help CEOs defend their cash cows as they commoditise and are affected by potential substitutes. In this post I’ll suggest some new perspectives that will enable CEOs to go on the offensive, to shape new markets and win within them.
The best defence, as the adage goes, is a good offense. This is obviously complete rubbish, but it sounds great, so I’m going to give it air time. It’s also true in my mind that the majority of the roles that we need relate to shaping and building the future business. Let’s cover them in that order.
We need to understand the environment in order to effect change within it. This suggests to me that we need to have someone in every decision who has a distinct mandate to seek to map out what could happen in the future in more specific terms than ‘change will happen’. One could see this role as a Chief Economist. More likely it is someone more akin to Pierre Wack, who was partially responsible for the development of the discipline of scenario planning at Shell in the 1960’s. By playing out numerous scenarios for the future he was able to help Shell’s leadership anticipate and navigate through geopolitical shocks such as the 70’s oil crisis.
It’s important that whoever plays the role of holder of the long term perspective does not degenerate into futurology and idle speculation. This is a job to systematically identify, understand and map out trends, using scenario planning to propose good, bad and weird things that may befall the organisation. In honour of the great man, I propose calling this role the ‘Wack Chair’, otherwise known as the ‘Wacko-in-Chief’.
What we’ve done by introducing the Wack Chair is to give us well thought through, broad spectrum perspectives on the future. That is not enough to give us a chance at winning. As I explore in the book, a crucial aspect of winning is to be cogniscant of the actions of one’s competitors, to deliberately understand them and to seek to disrupt those strategies by forcing them to respond to us.
What does a CEO need to do this? Well, in an ideal world he or she would have an advisor who deeply understands the mindset and motivations of the competition. This person can take the competitors’ perspective to understand observations and ideas in a different way, enabling superior orientation around observations and thus a stronger synthesis of new concepts. I’ll call this the Chief Competitor Officer. In the military would be a ‘Red Team’ or ‘Aggressor’ role – a vital part of any complex strategy. The CCO has one further role – they must think carefully and bring into the conversation happenings that could destroy the business in the future. The counter-narrative (often called a pre-mortem) is a useful thought experiment that allows extinction level events to be identified and the strategic concept adjusted to reduce the likelihood of them hitting.
The next perspective we need as we seek to shape the market and design a position for an organisation within it is, well, design. Design is a murky topic at the best of times, since it covers such a massive range of disciplines. In this instance what would is required is a system designer – someone who combines mastery of human-centred design and research with an appreciation of both macro and micro-economics. Ideally this is someone who is able to prototype the key elements of potential solutions and to teach the basics of that craft to their peers.
I feel that the later is important when we consider the capabilities of executive teams in general. The team should meet to work. Humans in general work well when they are discussing the tangible, but find it terrifically hard to collaborate on the uncertain and unknown. By introducing design process into the boardroom we are introducing a system that celebrates experimentation through making, not merely talking about making something. Rendering a future direction into a sketch (figurative, not necessarily literal) as we go helps us to grasp and share it.
So I guess I am therefore advocating for a Chief Design Officer. We got a CDO afterall.
The final ‘offensive’ role I’d like to propose is one that to an extent already exists but is amalgamated into a number of executive roles. The CDO takes the perspective of customer needs and behaviors, their interactions with current and future systems. What I feel we also needs is someone who understands how to develop and acquire the tools – in the book, I refer to them as ‘weapons’ – that provide optionality for the business in times of strategic need.
Some of these weapons are purely speculative and should be the kind of thing that only the organisation, with its deep industry knowledge can come up with. The strategic concept guides the domains of that development, but as with successful innovation facilities such as Xerox PARC and the Skunk Works, the developers themselves should have free time to pursue their own agenda. It is from this time that silver bullets sometimes form.
That is the R&D side of this proposed role covered. The other thing we need is the ability to identify and investment in external innovators. This typically takes the form of:
- Participation in investment rounds for startups with models that deviate from the core strategic thesis being pursued (hence bestowing optionality in the future if we are wrong about something)
- Acquistion of startups with models aligned to the strategic concept, thus enabling their features to be added to the incumbent’s distribution
These two associated, but distinct perspectives on the future and how to realise it are the purview of the CVO – the Chief Venture Officer.
Summary (so far)
With the creation of the CVO, I’ve reached the end of my imagination on the roles of the future executive team. I’m proposing seven potential roles to give the perfect perspectives to defend the core and build the future:
- Corporate Handyman
- Head of System Economics
- Ultimate Professional
- Wack Chair
- Chief Competitor Officer
- Chief Design Officer
- Chief Venture Officer
I hope this has been interesting thus far: as ever, comments greatly appreciated. Next time I’m going to briefly work through leadership configurations – a topic I REALLY wanted to get to in the book but just didn’t have the research done deep enough…