The winning company will not be the first one to start or the one with the best initial strategy, but the one that learns the fastest. The company that re-evaluates every month rather than yearly has the potential to learn 12x faster than it's competitor. Strategy is a hypothesis and the goal is to adapt as quickly as possible.
Everyone wants results, right? So then measure results to get results, right? Wrong. The results are lagging indicators. By the time you notice that the lagging indicators are off the mark it will be too late. Assess leading indicators such as your company's ability to learn in order to adapt the strategy.
Never Stop Learning=How To Win
Great post Nick, I just have one question which may be ignorant but bear with me. How do you measure a company's ability to learn quickly or a company's ability to adapt without measuring results? I completely agree that results are lagging indicators that show usually a quarter too late to significantly make up for lost ground. I also love your post on budgeting methods and the pitfalls of Percentage of Sales method, which completely reversed the causal affects of sales, your investments (marketing, etc.)
Posted by: Robin Gerlach | June 20, 2007 at 08:42 AM