A Major Weakness of Industry Lifers


In a previous article, I wrote about the first of the two major weaknesses that professionals who've spent their entire careers in industry face, that ex-consultants transitioning to industry do not.

The first was that while most industry lifers are functionally strong, they are often terribly weak cross-functionally.

In today's article, I'll discuss the second major weaknesses.

Most industry lifers, while strong tactically, are profoundly weak strategically -- usually for the first two decades of (if not the entirety of) their careers.

Tactical expertise relates to knowing how to do something in one's functional area. A marketing manager is tactically strong if he knows how to pull together a group of vendors to execute a marketing advertising campaign.

An engineer is tactically strong if she knows how to write code in a way that runs free of bugs, scales well with increased system load, and is compatible with the standards and interface points agreed upon by her colleagues who work on the same code base.

Tactically-oriented individuals tend to focus on what I call "the first order implications" of their decisions and actions.

For example, let's say the marketing manager shifts his marketing campaign from one printing company to another. The second company charges less, but will take longer to do the print job.

The first order implication will be that the campaign readiness date will be delayed. The competent marketing manager will check with his boss and coworkers in other departments (say the engineering team, if the marketing campaign is for a product launch) to determine if the delay is acceptable or not.

If it is, he'll take the savings in printing costs. If the delay isn't acceptable, he'll use the printing service with the faster turnaround time. This is first order implication thinking.

Second order implication thinking involves thinking about the ramifications of the first order implication.

When you get to the level of truly strategic thinking, you're operating at 3rd, 4th and 5th order implications.

Industry lifers, especially those at levels lower than C-level (e.g., CEO, COO, CFO), tend to be unable to think through their decisions to the level of 5th order implications.

Part of this is related to the first major weakness of industry lifers -- lack of cross-functional understanding of a business.

Most 5th order implications tend to be related to how a decision in one functional area profoundly impacts a completely different functional area.

If you aren't cross-functionally fluent, you will never have the background to grasp the 5th order implications of the decisions you and others around you make.

So to think strategically, you not only need the prerequisite of having a cross-functional understanding of a business, but you also need to develop the habit of seeing the domino or ripple effect of every business decision you encounter.

This kind of thinking is not intellectually that difficult. If I were to share with you a few examples from my own career, which I plan to do in a subsequent email, you will say, "Duh... That's common sense."

5th order implications are common sense after you or someone else notices them and points it out.

In hindsight, it's so obvious and the credit for the discovery goes to the person that points out non-obvious "obvious" things.

Up until that point, the "signal" of that insight simply gets lost in the "noise" of everyday operational headaches.

When I made the transition from consulting into industry, I got noticed by the executives around me for my ability to spot the 5th order implications of the decisions we, as an executive team, were considering.

I simply saw the downstream effects of the decisions others were considering and was able to point them out. Invariably, I would get a "that makes so much sense" or "wow, we could have totally screwed that up if you didn't point that out".

So while my executive colleagues were excellent in sales, marketing, engineering and finance, I was an expert in spotting bad decisions before they were actually made and executed.

I got invited to a lot of senior level meetings specifically because of this skill to "see around the corner" as to what would happen after a particular decision was made.

Again, this isn't an intellectually difficult thing to do. It's more about cultivating a particular kind of perspective and getting accustomed to thinking a certain way through repeated exposure.

When you're a lifer in industry, you just never get exposed to this way of thinking until you're a CEO or a COO.

However, when you are able to learn these skills while working in consulting or through other means, you're suddenly able to think in a way that is very similar to how your CEO thinks.

This is what happened in my career. I was 23 or 24 years of age and the CEO of public companies considered me a peer, and yet paradoxically I couldn't do the most basic of tactical things in my functional areas - such as create a marketing campaign, write a technical spec, or write a line of code.

This would perpetually baffle my colleagues who had 15 to 20 years of functional experience, and the CEO would request my presence and counsel in a meeting and not theirs.

When you clearly and obviously see and think like your boss's boss, suddenly you're pulled into meetings, situations, and decisions that you would otherwise have no business participating in.

That's the power of developing your strategic thinking skills.

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