Strategic Fitness: Elevate Your Acumen, Allocation, and Action

0:07Hello and welcome to another episode of the duct tape marketing podcast. This is John Jantz. My guest today is Rich Horwath. He is the founder and CEO of the Strategic Thinking Institute, where he's a strategy facilitator, speaker, advisor, and coach to executive leadership teams. He is a New York Times and Wall Street Journal bestselling author of eight books on strategic thinking, including the most recent work we're going to talk a little bit about today, Strategic, the skill to set direction, create advantage, and achieve executive excellence. So, Rich, welcome to the show. John, great to be with you.

0:43Thanks so much for having me. So I know I'm just going to start with this because if I ask 10 people, I'll get 10 different answers. What's your definition of strategy or strategic thinking? Yeah, so strategy for me is the intelligent allocation of resources through unique system of activity to achieve a goal. So simply put, strategy is how you plan to achieve your goal. And, you know, as I've read your books in the past, going back to duct tape marketing, you know, you talk about strategy before tactics. And I love in there, you always talked about the how, not the what. And I think I'm a big believer in that as well.

1:19I think too often, as you talk about in your books, and I share a little bit as well in my books, you know, we sometimes see people mistaking their mission, their vision, their goals, their objectives for strategy, you know, trying to be number one in the market, trying to be the premier provider of X. and instead we really need to think about how are we going to get there. That's really the strategy. So, you know, again, I've appreciated all the insights you've shared over the years on this. I think it's really helped a lot of us in the field. Well, I appreciate that. So let's get into a few more kind of logistic aspects.

1:52Is this something that you do once a year, once every three years? I mean, you know, is there a rhythm? Does it never end? I'd love to hear your thoughts on kind of the how often question. Yeah, John, and you hit it on the head initially. You talked about strategy and strategic thinking. So to me, strategy is something that you set. And really, if you've done your thinking, it should be something that stays in place for a long period of time. Where I think a lot of people could use a jumpstart is the strategic thinking part. So just because we have our strategic direction doesn't mean that we want to take our eyes off the road.

2:29And I know in one of your last books, you know, you talk about the importance. You've got a great five step process. Map and uncover are two of the first steps in your process. And I think that's a great those are great starting points when we think about strategy. When we think about mapping, as you talk about, you've got to understand what's my situation around me. And I think too often we get our head buried in the internal stuff or we're so reactive to fire drills with customers that we fail to remember what is the long term strategy that we've got in place. And so strategic thinking for me is really our ability to generate new insights or new learnings on a regular basis that help us keep and achieve that competitive advantage.

3:11So, you know, I think it's a great point that you bring up. To me, strategy is something that we set, but strategic thinking is something we should be doing day in and day out. We need to stay hungry on how we're going to get better and learn. You know, it's funny. There are some models out there that talk about strategic planning. You know, I think there's one very popular one that talks about, like, what's 10 years from now look like? I've had a lot of small business owners like they don't know what next quarter looks like. You know, how do you balance kind of long term and reality of short term?

3:41Right. Right. Yeah. You know, it's interesting you bring up there was just a study by PwC. They surveyed 4 ,700 CEOs and it was interesting, 45 percent. So nearly half of the CEOs said that they did not think they would be in business in 10 years unless they significantly evolved the way that they do business. So, you know, one of the things that we've got to be thinking about is how are we evolving in what I like to think is the business model, but it's really simple. It's how do we create value? How do we deliver value? And how do we capture value? So what I like to do is really create that strategy tune-up.

4:20So just like we get our car tuned up on a regular basis, what I recommend is quarterly get together with your team, take a couple hours, maybe it's over lunch, and go through just some of the basic fundamentals of the business. You know, have the customers thinking and actions changed? Has the competitive landscape changed at all? What's going on within our company? What's working? What's not? That takes a couple hours, but that's a great way to tune up the strategy to understand, should we be doing things differently, especially when it comes to creating and delivering value to our customers?

4:55Yeah. And I guess that's probably as good a description of strategic thinking as opposed to strategic planning. Like you might have a strategic plan, but the strategic thinking is something, it's the flexibility, it's the adaptability, it's the need to have to evolve and mature, isn't it? Yeah, I love the words you use there, flexibility, adaptability. That's something too, you know, it's that catch 22 as we get older, as we get more experience, we tend to lose that adaptability and that flexibility. And so one of the things I recommend to people is, you know, get some perspective outside of your industry.

5:30So, you know, read a journal in architecture or science or technology if you're not in those fields and think about how are those people assessing their problems, their challenges. I'm a big believer, too, in studying nature. You know, this whole idea of biomimicry. How can we take the challenges that we face? So getting more customers, creating a better sales funnel, closing more leads. When we think about nature, how has nature accomplished some of those things? How does nature, how does a species, how does a duck go from the winter to the summer? What do they do? Do they drop feathers? Do they get faster?

6:07All of those things can teach us if we take the time to step back and think about how other people are doing some things as well. So I think that's a big thing. you, like you said, adaptability and versatility are really important, but we need to remember as we gain more experience, we have to continue to push ourselves out of that comfort zone. You use the fitness metaphor quite a bit. I want to talk about the way you've broken the book up a little bit. Is there any particular reason why the fitness metaphor kind of works in strategic thinking in your mind? Well, one of the reasons is, again, we think about CEOs and you work with A lot of CEOs.

6:44I work with some as well. What's interesting is the average CEO exercises for 45 minutes a day, which I thought was pretty impressive. I mean, that's a good chunk of time each day to be exercising. But what we find is that when it comes to practicing or building our business fitness, and you've seen this, John, I'm sure in your world, people, we don't tend to practice. We tend to play all the time. So, you know, you've got, you know, football playoffs or baseball playoffs, you know, they're practicing 90 % of the time and they're in competition 10 % of the time. But in business, we're on that activity treadmill all the time.

7:18And what I've found is the best leaders, they jump off that treadmill, they take their team with them, and they think about how are some ways that we can get better. And they devote some time to training, to development, to a lot of the things that you've talked about and you've helped people with over the years as well. Taking that a step further, you've actually broken up into kind of four arenas. And so maybe I'll let you kind of walk us through those, obviously picking up a copy of strategic is how you're going to get the full compliment, but walk us through those four fitness arenas. Sure, John.

7:51And the reason I came up with these four areas and I use a compass to represent the four areas is I've looked at my coaching notes over the years. The one word that popped up again and again was the word navigate. A lot of folks that I was talking to said, we're having trouble navigating our competition. We're having trouble navigating these new market changes. And so I tried to come up with this compass based on the folks that I was working with in the four areas of strategy, leadership, organization, and communication. Because the reality is, even though strategy is my passion, if we're just good at strategy, we're going to be a failure long term.

8:27We've got to be good at communicating, executing. We've got to be great at marketing. We got to be great at sales. So there's so many things to be a well-rounded, strong leader. So I created those four areas to help people almost create a checklist to say, as a leader, am I checking off these areas? Do I have a strategy in place? Am I building leadership capabilities for myself and my team? Do we have a good culture? What's my emotional intelligence like? Do we have our value chain figured out? So all of those things are important. So I try to simplify it, give people a checklist so that they can kind of walk through that.

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10:07Now, this offer is limited to new Active Campaign customers only. So, what are you waiting for? Fuel your growth, boost revenue, and save precious time by upgrading to Active Campaign today. Okay. So maybe without, again, I know there are a lot of elements in here that rather than just reading a list, but give me a, give us a sense of, so you mentioned strategy, leadership, organization, and communication. Like what are some of the, what are some of the elements in each of those buckets? So, you know, beginning with strategy fitness, what, like, what are the areas that we would focus on if we were going to maybe make an assessment in that area?

10:43So, yeah, you know, let's so let's think about strategy. The one one thing that comes to mind, especially when we think about marketing and sales as well, is this idea of resource allocation. So we all know we've got resources, we've got time, we've got budget, we've got people. We need to move those around. What's interesting, though, John, is the research shows that 92 percent of companies allocate their resources once a year when they do their plan. But the best companies, the research shows, they reallocate resources, time, people, budget, programs, projects throughout the year. So that's one key element that I talk a little bit about in the book is just this idea that, look, we need on a monthly basis to think about where are we spending our time, our money, and our programs, and how can we change that so that we're putting more fuel on the things that are working and less fuel on the things that are not working.

11:34And then the other piece on strategy I would mention is I talk about competitive advantage. And again, kudos to you from Duct Tape Marketing. You talk a lot about being different and the importance of differentiation. And I've done some research on that, following in your footsteps as well. And again, even going back to science, this idea of the principle of competitive exclusion, meaning no two species can coexist that make their living the identical way. So you think about two male lions in the same area in Africa. after a while, one of the male lines isn't going to be there because they're trying to do the same thing in the same way.

12:07So one of the things we talk about in the book is this really importance of the idea of differentiation, which obviously not a new idea. You've talked about it, you know, 10, 15 years ago, but it is still something that we need to remind ourselves of. How are we different in ways that customers value? Awesome. So in leadership fitness, what are some practical examples of ways somebody might, I mean, you talk about mental training and, you know, emotional quotient and time management even, what are some practical ways that we can be looking into that bucket? Yeah, you know, especially for the small to midsize business leader, one of the things to think about is your time allocation.

12:45And obviously there's lots of stuff on time management, but when you look at the best CEOs that have run multiple companies at the same time, people like Elon Musk with SpaceX and Tesla, Jack Dorsey who runs Twitter and Square, one of the things they are really big on is batching their time. So they'll pick a couple things and they'll work on those things for two, three, four, five hours out of the day. And I know what people are saying, geez, Rich, you know, I've got a million things to handle, but the most effective leaders say, look, if I've got to do one-on-one meetings with my team, I'm not going to spread them out over the week.

13:20I'm going to do those all on Monday morning from eight to 11, because what that does, John, is it reduces the number of mental transitions that we have to make. And what the research shows is that the mental transitions jumping from one topic to the next, that's the thing that burns people out, that causes the fatigue that we feel at the end of the day. So if you can say, hey, I'm going to do email five times a day in these 15 minute chunks, I'm going to do my performance reviews here. That's going to simplify your life a lot. So that's just that idea of batching our time can be helpful. All right.

13:54Organizational fitness. I'm guessing culture goes squarely into that, developing your people, processes, talent, planning for what's next, innovating. So give us some practical examples of what we might focus on in organizational fitness. Yeah, you're right on the money, John. Culture is a big one. And the thing I think we miss a lot of times is we'll take the time to do our values. We'll do our mission statement, our vision statement. But what we really need to be aware of as a small to mid-sized business leader is what are the three or four behaviors that you're seeing the most from your team, either things that are productive or not productive?

14:36Because at the end of the day, behaviors are what. So if you want a better culture, you've got to pick out two or three behaviors that you as a leadership team really believe in are going to best serve your customers. and then you've got to find ways to build those behaviors within your team. So, you know, let's say customer centricity. That's, you know, a popular one. It's all about the customer. Okay, well, we can say that on paper, but what does that behavior look like? That might mean we're going to answer a phone call. We're going to return a phone call within one hour. We're going to return an email within three hours, and we're going to return a text message within four hours, whatever it might be.

15:14but putting some specific parameters around what do those behaviors look like. All right. And then the last one, communication fitness. I'll let you kind of pick out a practical example there. Yeah. So communication fitness, it's funny. I never used to talk about meetings at all, but ever since we've come out of, you know, the hybrid and the remote work, the last few years, people still have meetings stacked one upon the other. And so one of the things I found is just taking a strategic approach to our meetings. And what we mean by that is when you have a meeting, there should be three things in mind.

15:48Number one, what's the intent? So what's the purpose of this meeting? That should be shared with people two days, three days before. And I recommend giving one or two key questions that you want people to think about so that when you get together, it's a true dialogue. It's not a monologue. Too often I sit in our meetings and one person's talking for 30 or 40 minutes, that's not a meeting. That's a monologue for a late night talk show. So we need to make sure that we're really creating that interactive dialogue in meetings. And then the other big part is having insights. So when we finish up the meeting, you got to ask yourself, what was my takeaway?

16:26What did I learn from that meeting? And if we're not walking away from meetings with learnings, then we're wasting our time. We've got to either change that meeting or get rid of the meeting. So I'm a big believer as a leader out there, create a meeting inventory. So take an inventory of all the meetings you have on your calendar. And for one week, score those meetings on their value. Zero is no value. Three is high value. And at the end of the week, total those up. If you've got meetings that are around a zero or one average, get rid of those. Yeah, that's an interesting point because I think there are people that have gotten into this meeting rhythm where they're just like, no, it's Tuesday at noon.

17:05We do this meeting every week. And it's gotten to the point where it's of no value to anyone attending. In fact, it might actually be negative. But the idea of just like canceling, and I think really kind of freaks people out, doesn't it? All right. So in your work, your coaching work, if somebody said, gosh, I'm listening to this and there's some stuff making sense here, but there's also a lot that we've just hit the surface of, you know, how do you, when you, when somebody says, can you come in and talk to us, Rich? I mean, is there a, do you have a process that you walk everybody through? I'm like, where do you start?

17:42Yeah. So the one thing I'd recommend is to keep it simple. And you, you made a great point earlier about the difference between strategy and strategic thinking. So when we're trying to create strategic thinkers in the organization at all levels, I would keep it simple like three A's, acumen, allocation, and action. So that's where I would start as acumen. Always be asking yourself, what's the new value in this situation? So if you're talking with a customer, if you're having a staff meeting, what's the new value here that you can either create or deliver or capture? So always be thinking about what's the new value here.

18:18The reason a lot of businesses wind up failing in the long run is because they started with a good strategy, but then everybody else started to catch up and they didn't create any more new value. So why don't we think about that new value? And then the second A, allocation. I'm a big believer, and I know you've talked about this in the past, John, this idea of the not to do list. What are you not going to do? Who are you not going to service? Who are you not going to focus on? Too many of us are trying to serve everybody and we're minimizing the real value we can bring to that select few that are going to find the most mutual value.

18:52So big believer, we've got to be really selective in who we're focusing on, where we're focusing to be as valuable as possible. And that third A is action. I'm just, we just got to think about what are we prioritizing today? You know, if we've got a list of 17 priorities, we've got nothing prioritized. So just really thinking about what's my priority, the one or two things, and then am I matching my time spend to those priorities? If you look at the end of the day and a good exercise for folks to do, track your time for one week in 30-minute increments, add it up at the end of the week, graph it out, and then look at that graph and see if that matches up with your priorities.

19:33Too often, I'm seeing people say 50 % of my time is spent on stuff that's not really my priority. So, you know, take the time to assess your time where you're spending it. And that will really help, I think, with priorities. Now you have, and I can't remember if it's in the book or if I just saw it on your website, you have like an assessment people can go through, right? And measure some of where they are on some of these things? Yeah, absolutely. So the strategic quotient, you know, we've all heard of IQ forever, measuring intelligence, EQ, emotional intelligence. So what I try to create this strategic quotient, SQ, really measures how people think, plan and act strategically.

20:10So it's an assessment of your behaviors and your mindset. And it's a good starting point for people to say, yeah, you know, I'm doing a pretty good job here, but maybe I could be doing a little bit differently there. So it really matches up to with those three A's, acumen allocation action that we've talked about. So, again, just a simple way takes about five to seven minutes, but can start to shed some light on areas that you as a leader might want to spend a little bit more time on as you develop. Awesome. Well, Rich, I appreciate you stopping by the Ductate Marketing Podcast. Is there someplace you'd invite people to connect with you, find out more about your work and obviously about your books?

20:45Yeah, John, thanks for asking that. I appreciate it. So there are a lot of free resources, articles, white papers, videos at strategy skills dot com. So strategy skills dot com. Lots of free resources there. Awesome. Well, again, I appreciate you taking a moment to stop by and share with my listeners. And hopefully we'll run into you one of these days soon out there on the road.

21:10We'll be right back.