A structured strategic planning process provides the framework; however, the skill of critical thinking is at the core of strategy development.
Applying critical thinking when developing business strategy is crucial to maximising opportunities, avoiding risks, hidden traps, or icebergs.
As you may know, The Titanic was a British passenger liner that sank on its maiden voyage in 1912 after striking an iceberg off southern Newfoundland. The ship was claimed to be unsinkable. This tragedy teaches us that even the most confident and well-prepared strategy can fail. It also teaches us that we need to be prepared for the unexpected. But what can we learn from this disaster when developing business strategy and undertaking strategic planning?
Let’s analyse the Titanic situation in the context of critical thinking and strategy development.
Start by questioning the right people.
Looking at the big picture, there were clearly other risks including late arrival, navigational error, a mid-journey fuel/food crisis, crew mutiny, engine failure, substantial repairs and maintenance, accident, or any of other doomsday possibilities. Armed with some critical thinking assessment skills, an experienced strategic planning facilitator would have asked widely and sought input from relevant crewmembers, who would have thrown light on the implications and the lack of controls in place to mitigate risks.
Make sure you have the right to survey widely.
A cup of tea with the Titanic’s captain would not have been sufficient. The captain may have provided such assurances that his 26 years’ experience meant the ship was in safe, experienced hands. He could have gone into detail about the science of the ship’s compartmentalised design emphasising the ship was unsinkable – even in the unlikely event of an accident. Aware of the need for critical thinking assessment, an experienced strategic planning facilitator would have asked widely and sought input from others, including those outside the ship building team who would highlight concerns and design flaws.
Don’t be afraid to challenge the basis of management’s confidence.
By widening the survey and seeking input outside the executive team, an experienced strategic planning facilitator would have identified other risks and probabilities disregarded by the captain. Setting up crew workshops, with appropriate assurances of confidentiality, may have yielded more honest results from those with less of a vested interest in an early arrival. These findings may have included the ship was on its maiden voyage, and much of its processes and machinery were untested, an iceberg warning had been received but this had not been translated into cautionary action, the crew were not equipped with binoculars and “mill pond” environmental conditions were ideal for speed but difficult for iceberg-spotting.
Check the details and cross-check facts.
An experienced strategic planning facilitator could then have used the information from workshops with the crew, and their discussions with others outside the organisation, to hypothesise about realistic scenarios. In doing so, they may have uncovered the fact that emergency contingency preparation was poor including the fact that lifeboat capacity was significantly less than needed for the number of passengers and crew, there had been little emergency training for the crew, emergency awareness amongst passengers was poor and there were too few emergency signs to assist passengers. The strategic planning facilitator using critical thinking may have realised that the opportunity of a celebrated early arrival threatened to blind senior management to the accompanying risks.
Harness organisational knowledge.
The school of hard knocks tells us that even the most enlightening strategic planning process can be derailed by attempts to ‘pull the wool’ over the facilitators eyes; especially a crew intolerant of questions by outsiders. “We have lifeboats”, “every passenger has a lifejacket”, “we’re using an established sea route” could have been simple assurances to side-track the fact finding. A strategic planning facilitator needs the critical thinking skills and experience to counter-challenge management assurances and must have the courage to think through the undesirable events that management, or in the case of the Titanic, the crew may prefer to disregard.
Linking the separate issues during the strategic planning process would reveal the seriousness of the situation. Iceberg warning + mill pond conditions + no binoculars + high speed collectively increased the probability of a collision with an iceberg. Synthesising other findings, such as lifeboat capacity was insufficient, that lifejackets alone were not adequate in freezing conditions and that in the event of a major emergency, the nearest ship was several hours away, the strategic planning facilitator could use their experience to direct management’s attention to address these issues during the strategy development.
Use the correct forum.
Convincing the captain alone to act on the critical findings may have been difficult. But in the right forum of senior colleagues, the captain would have been forced by the logic of the possible dangers. The coherence of the strategic planning facilitators presentation, their ability to lead the discussion and use a structure strategic planning development framework would have all led to more robust precautionary action.
Conclusion
There were of course a wide range of other governance issues aboard the Titanic. Unchecked authority was vested in a captain who appears to have had a large appetite for risk. Quite likely, risk may not have been at the forefront of anybody’s mind. In a business context, these issues are being addressed by recent developments in corporate governance and in particularly during the development of business strategy through structured strategic planning led by an experienced strategic planning facilitator.
This hypothetical post-mortem may put some perspective on how critical thinking can help to look beyond the obvious to wider issues impacting a business. For businesses undertaking strategic planning, this translates into evaluating the realism of management’s assessment of marketing, the businesses competitive advantage, capacity, capability of the team, accuracy of revenue and profitability projections, the honesty of sensitivity analyses, the effectiveness of cash flow monitoring, the robustness of contingency planning, etc.
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