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Pivot: Why tomorrow's leaders must be light on their feet

Tom Cheesewright

Tom Cheesewright

Tom Cheesewright on why agility is essential if you want to be a leader in the future

“Sometimes it doesn't matter which choice you take, a leader just has to make a decision.”

There's an element of truth in this old adage about management. Versions of it abound across the internet, attributed to various characters from history. They are often military figures, which is slightly terrifying. Of all the people that I want to be sure about the decisions they make, generals would be right at the top of the list, alongside my doctor.

 

With the increased collection and interpretation of data from our own businesses and the operating environment, we will truly have 20/20 hindsight. The reality of our decisions, good and bad, will be laid out in all its numerical glory. The only question is: what will you do with that data?

The idea that making a decision is more important than the decision you make speaks to the pop psychology of management: people want a leader to be 'strong'. It speaks to the reality of management too: much of the time there is no such thing as a 'right' decision. Rather there are two or more options each with their own merits and problems. Choosing between them is not some objective weighing of the pros and cons, some of which will be intangible. It's a subjective choice. Leadership is really about making a success of whichever path you choose.
'Past performance is not an indicator...'

If you have lots of evidence about the past it's easy to believe you might be able to predict what will happen in the future. As Dan Gardner explains so eloquently in his book 'Future Babble', this is not the case. Predicting the future with any degree of precision – particularly on the basis of historical data – is largely a game of chance.

In an increasingly systematised workplace we are not short of data. As we collect ever more data about our daily operations it will be tempting to think that decisions about the future can be made on a purely objective, empirical basis. They can't. As the small print on any investment clearly says: 'Past performance is not an indicator of future results.' We can examine trends and try to make good guesses about the direction of future change – in fact I've made this my job. But we cannot possibly know exactly what will happen. There are just too many variables.

This isn't to say there's no value in the data we collect about performance. But what it tells us may not be comfortable for some leaders. Because though the data cannot tell us which decision to make, it can tell us in retrospect when we made the wrong call.

With the increased collection and interpretation of data from our own businesses and the operating environment, we will truly have 20/20 hindsight. The reality of our decisions, good and bad, will be laid out in all its numerical glory. The only question is: what will you do with that data?

Pivot

The answer will be familiar to anyone schooled in the ways of the Silicon Valley start-up. Faced with failure, what do you do? You pivot.

In start-up land a pivot can be radical or it can be a more subtle shifting of emphasis. In 'Lean Startup', the closest thing the tech industry has for a manual for start-up success, Eric Ries lists ten different ways a start-up can pivot, around features, technology, revenue model and more. Most successful start-ups pivot more than once.

Take my own start-up, CANDDi. We created software that tells companies more about the people visiting their website. When trying to sell the product we tried multiple feature sets, price points, audiences and marketing schemes before settling on the current approach, which seems to be working. Audience was a great example: we were selling what we thought was a marketing product so it made sense to go to marketing agencies. They had tens of clients so we figured they would help us to scale quickly. They didn't. We made sales but the agencies consumed lots of our time and delivered very little back because selling software to their clients just didn't fit their model. The data on the time cost of each opportunity showed us within a few months that our approach was wrong. We were never going to scale this way. So we pivoted and started selling to sales directors. That was much more successful – as the data showed.

Evidence and confidence

Pivoting a small start-up and pivoting a large enterprise are very different things. But the principle requirements are the same. First of all you need the evidence to show that you are on the wrong path. Second, and more importantly, you need the confidence to see what the data are telling you and act.

This requires acknowledging that your initial choice was incorrect. That's never easy, as any politician will testify. But in an increasingly data-rich business world, if you don't accept the reality, someone else is bound to make the decision for you.

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