Luis Vives Associate Professor in the Department of Strategy and General Management Think for a moment about a century-old company such as Ford. Do you think this automobile giant will stay in business for another hundred years? Will it be able to survive just by launching new car models? Surely not... Today's mobility revolution goes beyond electrically powered engines; it will surely bring about changes in how we use vehicles in our daily lives. The self-driving car is on the verge of becoming a reality. In this context, what should a company like Ford do? The ability to think long-term does not make it easy to implement the changes that the future requires. In today's world, a business strategy that involves building commitments - which traditionally strengthened an organization's competitive advantage - can lead to strategic rigidities. For companies unprepared to recognize this fact and react in a timely manner, the consequences can be fatal. Think about companies such as Netflix and Kodak. Think about how the banking industry's value-creation model has changed. Think about your own business. Are you prepared to develop this sort of long-term vision? Organizations need leaders with a long-term vision 3 tips for developing strategic thinking Organizations need leaders who think strategically and with a long-term vision. This isn't easy, because strategic thinking requires knowledge of techniques and tools as well as the development of the right mindset. Tools alone are insufficient, but certain practices can give executives an edge. Here are three tips on how to develop strategic thinking: 1. Time for reflection Strategic thinking requires time for reflection. The daily demands of the job pose a difficult challenge to executives who want to think strategically in the long term. To develop their strategic capacity, leaders - both alone and in groups - must set aside time outside their day-to-day activities to think about and discuss their organizations' long-term priorities. 2. Information is key Leaders who want to think strategically must be informed about emerging trends and their future implications. It's like playing chess. Professional players always think and plan several moves in advance. 3. Long-term culture Strategic thinking also requires a company culture that rewards and encourages people to think about the long term. This means helping employees stay up-to-date in their areas of expertise by providing learning opportunities and venues for discussion. Read the original article published in Harvard Deusto Business Review. About the author Dr. Luis Vives is the Associate Dean of the Full-Time MBA, Director of the Multinational MBA and Associate Professor of Strategy and General Management at ESADE. Before joining ESADE, Dr. Vives was a Postdoctoral Fellow at the Sloan School of Management at the Massachusetts Institute of Technology (MIT). Dr. Vives has been a visiting scholar at Harvard University and at various universities in Europe and Latin America. As a lecturer and consultant, he has worked with multinational companies in the United States, Europe, Latin America, Asia and the Middle East across multiple sectors, including banking, insurance, telecommunications, wines and spirits, pharmaceuticals, creative industries, logistics and industrial groups. His research focuses on the creation and development of innovative business models. His work has appeared in journals such as Sloan Management Review, Journal of Organizational Behavior, Long Range Planning, Advances in International Management and Advances in Strategic Management.

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Business strategy: the risks of focusing only on short-term gains

05/2019


Luis Vives


Associate Professor in the Department of Strategy and General Management




Think for a moment about a century-old company such as Ford. Do you think this automobile giant will stay in business for another hundred years? Will it be able to survive just by launching new car models? Surely not...


Today's mobility revolution goes beyond electrically powered engines; it will surely bring about changes in how we use vehicles in our daily lives. The self-driving car is on the verge of becoming a reality. In this context, what should a company like Ford do?


The ability to think long-term does not make it easy to implement the changes that the future requires. In today's world, a business strategy that involves building commitments - which traditionally strengthened an organization's competitive advantage - can lead to strategic rigidities. For companies unprepared to recognize this fact and react in a timely manner, the consequences can be fatal.


Think about companies such as Netflix and Kodak. Think about how the banking industry's value-creation model has changed. Think about your own business. Are you prepared to develop this sort of long-term vision?


Organizations need leaders with a long-term vision


3 tips for developing strategic thinking


Organizations need leaders who think strategically and with a long-term vision. This isn't easy, because strategic thinking requires knowledge of techniques and tools as well as the development of the right mindset.


Tools alone are insufficient, but certain practices can give executives an edge. Here are three tips on how to develop strategic thinking:


1. Time for reflection


Strategic thinking requires time for reflection. The daily demands of the job pose a difficult challenge to executives who want to think strategically in the long term.


To develop their strategic capacity, leaders - both alone and in groups - must set aside time outside their day-to-day activities to think about and discuss their organizations' long-term priorities.


2. Information is key


Leaders who want to think strategically must be informed about emerging trends and their future implications.


It's like playing chess. Professional players always think and plan several moves in advance.


3. Long-term culture


Strategic thinking also requires a company culture that rewards and encourages people to think about the long term.


This means helping employees stay up-to-date in their areas of expertise by providing learning opportunities and venues for discussion.


Read the original article published in Harvard Deusto Business Review.


About the author


Dr. Luis Vives is the Associate Dean of the Full-Time MBA, Director of the Multinational MBA and Associate Professor of Strategy and General Management at ESADE. Before joining ESADE, Dr. Vives was a Postdoctoral Fellow at the Sloan School of Management at the Massachusetts Institute of Technology (MIT).


Dr. Vives has been a visiting scholar at Harvard University and at various universities in Europe and Latin America. As a lecturer and consultant, he has worked with multinational companies in the United States, Europe, Latin America, Asia and the Middle East across multiple sectors, including banking, insurance, telecommunications, wines and spirits, pharmaceuticals, creative industries, logistics and industrial groups.


His research focuses on the creation and development of innovative business models. His work has appeared in journals such as Sloan Management Review, Journal of Organizational Behavior, Long Range Planning, Advances in International Management and Advances in Strategic Management.

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