Your Strategy Needs a Dialogue: Part 1
Starting the Conversation: Laying the Foundation for Strategic Dialogue
Welcome to the Leadership Bebop newsletter, where we unravel the complexities of modern leadership through the lens of strategic dialogue.
This edition marks the start of a new series, “Your Strategy Needs a Dialogue.” Let me know what you think, and please subscribe and forward this to others who might be interested.
Introduction: Strategic Dialogue in the Real World
In a dynamic world of disruption, distrust, and digital transformation, the story of Bacardi's pivot during the pandemic speaks volumes about the power of strategic dialogue. Picture this: it's 2021, and Bacardi’s top brass, led by John Burke, then Global Chief Marketing Officer, faces unprecedented market chaos. The global pandemic response radically disrupts consumer behaviors, making traditional strategies obsolete. Burke realizes it's time to listen, really listen, to what the market is saying. So, Bacardi starts running daily "human signals pulse surveys" to keep a real-time pulse on evolving consumer sentiments. (Check out this 2022 blog post for more on this story.)
In stark contrast to this adaptive approach is the infamous downfall of Sears, a cautionary tale of what many described as a “top-down tyranny.” Under the leadership of Chairman and CEO Ed Lampert, Sears failed to adapt to shifting market forces, leading to the company’s downfall. Lampert's well-known micromanagement, suppression of dissent, and strategy of isolating division chiefs to encourage competition rather than cooperation led to internal strife and crippled Sears' ability to address market challenges, accelerating the decline of the once-iconic retail giant.
While there is no shortage of speculation about the factors contributing to Sears’ downfall, nearly all analyses point to the significant leadership failures in the end. A 2016 Forbes article summarized these as follows:
Micro-management instead of strategy;
Manage by the numbers rather than trends;
Seeking confirmation rather than disagreement; and
Hubris - unfailingly believing in oneself regardless of the outcomes.1
These two contrasting tales — one of agility through engaged listening and strategic dialogue and the other of downfall due to isolated, top-down decision-making — underscore the critical importance of strategic dialogue.
For those who might object to an apples-to-oranges comparison between a beverage brand and a big box retailer, both sectors have had successes and failures that highlight the importance of strategic dialogue. Retailers like Walmart, Best Buy, Home Depot, and Costco have thrived in the turbulent retail space by listening to customers and employees, streamlining operations, and taking other actions to remain competitive. And the beverage industry has had its share of cautionary tales—from the historic New Coke and Pepsi Crystal Clear fiascos to the recent Bud Light ad controversy— emphasizing the importance of careful planning, preparation, and honest internal discussions that invite alternative viewpoints, especially when taking bold or potentially controversial actions.
What is Strategic Dialogue?
Strategic dialogue is not about having more conversations, boosting communication frequency, or adding more meetings. It’s not about intensifying management directives, project management protocols, or messaging efforts. Such efforts can be constructive, though they can also be counterproductive. What transforms ordinary conversations into strategic dialogue is having a clear purpose and intentional focus while remaining open to new perspectives and ideas, listening deeply and generously, and committing to ongoing meaningful discussions about the things that matter most.
When teams venture beyond their comfort zones–letting go of established narratives and entrenched beliefs to embrace curiosity and openness–they move into the "growth zone" where true innovation thrives. This sets the stage for an active exploration of considerations and possibilities, eventually converging around an action plan that considers all inputs, not just the initial ideas of those in charge.
Below are suggestions and questions to help with this process. But first, let’s explore why this is difficult and introduce a fictional example that we’ll use throughout this series.
Why Strategic Dialogue is So Elusive
With their linear, long-term focus and top-down decision-making processes, traditional strategic planning processes often fall short in today's fast-paced, unpredictable world. Yet, despite these widely acknowledged limitations, many organizations resist more adaptive, collaborative approaches to strategy and decision-making.
Surveys continue to paint a stark picture of modern workplaces globally: widespread disengagement, rising stress among workers, and a deep unfulfilled desire for more meaningful work, fairer treatment, and involvement in decision-making processes.2 This growing disconnect suggests that real-world efforts are falling short even as the buzz around leadership, communication, workforce engagement, conflict resolution, and organizational improvement grows louder.
Adding to the complexity, many companies (and leaders) have embraced the language of innovation, collaboration, inclusiveness, listening, and dialogue while doubling down on top-down command-and-control strategies. Others cultivate a workplace culture that proudly proclaims a commitment to inclusiveness yet openly rewards certain viewpoints and excludes or punishes others. This is not strategic dialogue; it’s innovation theater.3
The prevalence of innovation theater likely contributes to the growing disconnect among workforces and fuels skepticism about modernized approaches to decision-making and strategy. And let’s be honest: having meaningful conversations and strong relationships has always been challenging and is increasingly difficult in the current cultural and political climate. Humans have a natural inclination for connection, community, and collaborative creativity, yet we must learn the communication and relationship skills to work together effectively.
Notwithstanding these challenges, the evidence is overwhelmingly clear that those organizations that commit to strategic dialogue are rewarded, while those that do not are left behind.
To help illustrate the practical aspects of strategic dialogue, let’s check in with a fictional community health system, Sierra Regional Health.
Ballad of Sierra Regional Health: Part 1 - The Newcomers
Three years ago, Dr. Eric “Hoss” Carter took on the CEO role at Sierra Regional Health, faced with modernizing a community health system grappling with financial instability, outdated practices, and an evolving healthcare landscape. Serving parts of three rural counties with diverse populations, Sierra Regional aimed to provide essential healthcare services and innovate in telehealth and integrated care, addressing the diverse needs of its widespread community.
Under Dr. Carter’s leadership, the first two years saw significant reforms: reorganizing the leadership team, modernizing processes, and bolstering staff morale. These changes revitalized the organization’s spirit and financial health, earning Dr. Carter respect within the organization and the communities served.
Entering his third year, Dr. Carter faced fresh challenges. In a comprehensive annual strategy session—a tradition at Sierra Regional and a practice from his previous roles—Dr. Carter and the board revisited the strategic plan, which historically leaned on traditional healthcare models and MBO frameworks. Inspired by Cost Leadership and Core Competencies principles, the plan aimed to streamline operations while expanding innovative healthcare solutions.
However, implementing this updated strategic plan, particularly decisions to cut certain community programs deemed unprofitable, sparked discontent. Despite Dr. Carter’s intent to communicate changes effectively, staff felt excluded from decision-making processes, leading to a disconnect between the executive team and frontline workers. Morale dipped as employees questioned the direction of their work and its impact on community service.
Recognizing that restructuring, though crucial, was insufficient, Dr. Carter saw the need for strategic dialogue—an inclusive, genuine approach allowing all voices within the organization to shape its future. He understood that lasting success required more than sound financial decisions; it hinged on the trust, participation, and collective effort of the entire Sierra Regional team.
This story, while fictional, underlines the critical importance of strategic dialogue in healthcare leadership. The challenges faced by Sierra Regional reflect common issues in modern healthcare systems and other industries: the need for adaptive relationship-focused processes, transparent leadership, and collaborative strategy formation. In upcoming newsletters, we’ll revisit Sierra Regional’s journey, exploring how strategic dialogue can bridge gaps among leadership, staff, and the communities served, leading to a more engaged, innovative, and resilient healthcare organization.
Components of Strategic Dialogue
Drawing on experience and in-depth research, we've identified several key elements of strategic dialogue within three main areas: mindset, practice, and cultural integration.
Mindset Transformation. At the core of effective strategic dialogue is a shift in mindset—from a fixed to a growth-oriented perspective. This transformation involves cultivating self-awareness and self-compassion and practices that promote well-being, mindfulness, and strategic agility. In organizations that truly embrace a learning mindset, leaders and team members commit to continuous learning and personal growth, viewing challenges as opportunities to adapt and evolve rather than obstacles that must be overcome in pursuit of a fixed objective.
Practices for Engagement. Building on a foundation of personal growth, strategic dialogue involves practices that spark authentic engagement with others. These include intellectual humility, relational compassion, perspective-taking, and generous listening. Such practices ensure that conversations are not just transactional but transformative. This allows for a deeper connection and understanding among team members, promoting mutual trust and shared commitments.
Sustaining Progress Through Cultural Integration. Strategic dialogue is an ongoing journey, not an endpoint. It embodies a commitment to adaptive mastery over time through continuous learning, fostering and thriving on attentive listening, adaptive accountability, resilience, constructive conflict engagement, and authentic relationship building. Sustained commitment to these principles ingrains them into the organization's culture, equipping teams to navigate disruptions and stay true to their strategic course amid challenges.
The Role of Leadership in Fostering Strategic Dialogue
Leadership is crucial for strategic dialogue. At Bacardi, leadership embraced adaptability, showing how active engagement leads to innovation. Conversely, Sears' top-down approach under Ed Lampert stifled innovation, leading to decline. Similarly, Sierra Regional Health's missteps under Dr. Hoss’s leadership highlight the need for collective input in strategic decisions. These examples underscore the importance of engaging all voices in strategy formation for successful outcomes.
Leaders must foster strategic dialogue by creating environments that prioritize open communication, psychological safety, and diverse viewpoints. They should also model adaptability and engage continuously with team members to ensure strategies are responsive and collaborative.
Preparing for a Shift Towards Strategic Dialogue
Embarking on strategic dialogue requires a shift towards inclusiveness, valuing diverse perspectives, and fostering a culture of psychological safety and open engagement. This shift, challenging yet crucial, involves:
Establishing Clear Communication Channels: Facilitate varied feedback and discussion methods, potentially restructuring meetings for deeper engagement.
Setting the Stage for Strategic Dialogue: Leaders should consistently demonstrate their commitment to hosting constructive conversations around things that matter most.
Starting with Small Initiatives: Begin with manageable projects to build familiarity and confidence in the new approach.
Training and Development: Provide resources and workshops to equip team members with the necessary skills for effective dialogue.
Celebrating Early Wins: Acknowledge initial successes to build momentum and demonstrate the value of strategic dialogue.
Core Questions to Foster Strategic Dialogue
Below are questions to explore that can help facilitate strategic dialogue in your organization or team:
What key issues or decisions are we facing that require us to move beyond our comfort zones or established narratives? This question helps identify the topics most needing strategic dialogue, encouraging participants to address challenges that may have been overlooked or avoided.
Whose perspectives are we missing or minimizing in our current discussion, and how can we bring those voices into the conversation? This question aims to broaden the scope of dialogue by ensuring that diverse viewpoints are represented and considered, preventing echo chamber effects.
How have we (or others) approached similar challenges, and what can we learn from those experiences to inform our current decision-making? This encourages participants to reflect on historical data and experiences, applying lessons learned to current situations while remaining open to new solutions.
What assumptions are we making, and how might they be challenged or re-evaluated in light of new information or different perspectives? This question prompts participants to examine and question the underlying assumptions guiding their thoughts and actions, fostering a more open and inquisitive dialogue.
How will we integrate the diverse inputs and perspectives gathered here into a cohesive action plan, and how will we measure its effectiveness? This focuses the dialogue on actionable outcomes and accountability, ensuring that the conversation leads to concrete steps, criteria for success, and an adaptive framework that allows the strategy to pivot as new information emerges and circumstances change.
Conclusion: Laying the Foundation for Strategic Dialogue
A strong foundation in strategic dialogue, emphasizing openness, adaptability, and inclusiveness, is crucial for an organization's sustained success. Leaders and team members can unlock new levels of collaboration and resilience by fostering an environment that values ongoing conversation, innovation, and a shared purpose.
In our upcoming issues, we'll explore the nuances of strategic dialogue, debunking myths, addressing common misconceptions, and offering practical transition steps. We'll delve into the dynamics of human interaction and creative collaboration, drawing from multiple disciplines to enhance dialogue with tools for effective listening, active inquiry, and constructive conflict transformation.
Stay tuned for comprehensive insights to guide your organization through informed, inclusive decisions, navigating current challenges, and setting the foundation for enduring success.
Into Action: Reflect, Subscribe, and Engage
Questions for reflection:
How inclusive, adaptive, and open to dialogue are your current strategy and decision-making processes?
What would a culture of creativity, collaboration, and constructive conflict engagement look like for your organization or team?
What is working now that you could build on to enhance the quality and depth of your conversations around purpose, direction, and decision-making?
Enjoying the insights? Subscribe and follow our series for deeper dives into effective communication and collaboration, empowering you with strategies to enhance your path to leadership and organizational success.
An Invitation: Synerlogic’s 360 Dialogue™ Assessment for Executives and Teams
I'm excited to introduce a new tool, designed with colleagues here at Synerlogic, to help leaders foster the mindset, relationship, and communication dynamics essential for heightened engagement and successful outcomes: the 360 Dialogue™. This innovative process cultivates essential leadership skills for executives and leadership teams.
Unlike traditional personality assessments that often rely on outdated theories around identity and human development, this process uses scientifically validated research on effective leadership dynamics and interpersonal communication. Currently in the beta testing phase, this process delivers a fresh perspective tailored to the complexities of today's evolving workplace.
Please reach out if you want to learn more or participate in our pilot program. This is a unique opportunity to help redefine leadership and strategy for the modern era.
Adam Hartung, The 5 Ways Ed Lampert Destroyed Sears, Forbes, https://www.forbes.com/sites/adamhartung/2016/02/11/the-5-ways-ed-lampert-destroyed-sears
Gallup’s 2023 State of the Global Workplace revealed that while worker engagement is rising globally, most of the world’s employees are ‘quiet quitting,’ employee stress remains at a record high, and over half of employees are actively or passively job-seeking. When asked about changes they would make to their work, 85% of responses related to engagement or culture, pay, and well-being. Many respondents expressed a desire for increased recognition, learning opportunities, fair treatment, clear objectives, and better management. See Gallup, State of the Global Workplace: 2023 Report, https://www.gallup.com/workplace/349484/state-of-the-global-workplace.aspx#ite-506897.
See, e.g., Steve Blank, Why Companies Do ‘Innovation Theater’ Instead of Actual Innovation, Harvard Business Review, Oct. 2019, https://hbr.org/2019/10/why-companies-do-innovation-theater-instead-of-actual-innovation.