HBR On Strategy: Episode Summary

Title: To Set a Great Strategy, Start by Imagining the Future You Want
Host/Author: Harvard Business Review
Release Date: September 18, 2024

Introduction

In the episode titled "To Set a Great Strategy, Start by Imagining the Future You Want" from the HBR On Strategy podcast, Harvard Business Review's Kurt Nichish engages in a profound conversation with Mark Johnson, co-founder of the innovation consulting firm Innocyte and co-author of the book Lead from the Front: How to Turn Visionary Thinking into Breakthrough Growth. The discussion centers on redefining business strategy through a future-back approach, emphasizing the importance of visionary thinking in strategic planning.

Understanding the Future-Back Approach

Mark Johnson introduces the concept of the future-back approach as an alternative to the traditional present-forward approach. While the present-forward method focuses on immediate market signals and current operational challenges, the future-back approach starts with a clear vision of the desired future and works backward to align the organization accordingly.

Notable Quote:
"Good leaders should be starting with the future and working backward. He calls this taking a future back approach rather than a present forward one."
— Kurt Nichish [03:18]

Johnson emphasizes that although the present-forward approach accounts for 80-90% of managerial efforts, dedicating 10-20% of leadership time to future-back thinking can unlock significant strategic advantages.

Vision vs. Strategy: Clarifying the Distinction

A pivotal part of the conversation delves into the distinction between vision and strategy. Johnson contends that while strategy often revolves around "where to play and how to win," vision defines "what is the game that you should play" and prepares organizations to adapt to different paradigms.

Notable Quote:
"Vision is getting you out in that five to ten year horizon of what you could and should be, not just about the way things are today."
— Mark Johnson [05:52]

Using Apple as an example, Johnson illustrates how Steve Jobs leveraged visionary thinking during the dot-com crash to transcend the personal computer market and pioneer the digital hub concept, ultimately reshaping multiple industries.

Practical Steps for Implementing the Future-Back Approach

Johnson outlines actionable steps for managers and leaders to adopt the future-back methodology:

1. Allocate Time for Visionary Thinking: Dedicate a portion of leadership time (10-20%) to envision the future beyond the immediate crisis.

2. Break Free from the Present: Encourage open-mindedness to explore the "art of the possible" without being constrained by current operations or past paradigms.

3. Develop Implication Archetypes: Identify whether the business is on an upward trajectory, facing growth gaps, or encountering transformational opportunities.

4. Continuous Learning and Adaptation: View vision as an evolving process, revisiting and refining it regularly based on market learnings and scenario developments.

Notable Quote:
"Vision is just one component of the process that leadership teams need to amp up their game."
— Mark Johnson [09:40]

Real-World Examples of Future-Back Thinking

The episode showcases several organizations that have successfully implemented the future-back approach:

• Apple: Under Steve Jobs, Apple envisioned a future beyond personal computers, leading to innovations like the iPod and iPhone, which transformed the consumer electronics landscape.

• Johnson & Johnson's Janssen Division: Led by Bill Hite, Janssen foresaw the convergence of life sciences with biomedical devices, shifting focus from disease treatment to prevention. This strategic pivot required substantial effort to realign the company's business model from reactive to proactive healthcare solutions.

• Intel: Inspired by Clayton Christensen's theories on disruption, grassroots efforts within Intel fostered a culture of visionary thinking, enabling leaders like Andy Grove to drive strategic transformations that kept the company competitive.

Notable Quote:
"Without that future-back approach, it would be very, very difficult to get past all of the challenges and realities of the day to day business model of a pharmaceutical company."
— Mark Johnson [16:08]

Applying the Future-Back Approach in Various Contexts

The discussion extends to practical applications of the future-back approach across different organizational levels and industries:

• Store Owners and Retail Managers: Envision future customer needs and adapt store architecture and expansion plans accordingly. For example, a food market owner might rethink store layouts to accommodate changing consumer behaviors post-pandemic.

• Educational Institutions: Universities can apply future-back thinking to transform academic offerings, such as integrating online education more seamlessly into their business models, rather than merely digitizing existing programs.

• Individuals and Mid-Level Managers: Encourage the development of a future-back mindset within teams. By fostering a common language and shared vision, employees at all levels can contribute to strategic innovation.

Notable Quote:
"It's never too late to learn. Making that choice, to say, we are going to spend 10% of our time thinking about the longer term..."
— Mark Johnson [22:16]

Overcoming Challenges and Embracing Uncertainty

Johnson addresses potential apprehensions about adopting a future-back approach, especially during times of uncertainty. He reassures that envisioning the future is not about achieving certainty but about fostering a mindset geared towards learning and adaptability.

Notable Quote:
"If vision is viewed as somehow you have certainty about this five to ten year horizon, then it definitely would seem not only overwhelming, but probably ridiculous."
— Mark Johnson [09:19]

By treating the vision as an evolving "impressionist painting" rather than a fixed "photograph," organizations can remain flexible and responsive to emerging trends and disruptions.

Conclusion

The episode underscores the transformative potential of the future-back approach in strategic planning. By prioritizing visionary thinking and dedicating resources to envisioning future possibilities, organizations can navigate uncertainties more effectively and seize emerging opportunities. Mark Johnson's insights provide a compelling framework for leaders aiming to cultivate long-term success through innovative and forward-thinking strategies.

Notable Quote:
"It's about carving out this time, spend a little bit of time in the future being able to think about how things could be different and where opportunities will arise."
— Mark Johnson [16:57]

This episode serves as an invaluable resource for business leaders, managers, and individuals seeking to enhance their strategic planning processes by integrating visionary thinking with actionable strategies. By imagining the future they desire, organizations can proactively shape their paths to sustained success.