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Boards spend only 9% of their time considering risk.

(2017: 1,126 sample)

Only 6% believe they are effective at managing risk.

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“On strategic opportunities and risk trade-offs, boards should foster explicit discussions and decision making among top management and the businesses.”

McKinsey: October 2018

 

Conventional strategies are...

  • Backward-looking, not forward
  • Linear in nature, often based on un-tested assumptions
  • Artificially “quantitative”, resulting in a false sense of certainty
  • Preventative of rigorous criticism during development, due to collaborative incentives
Senior Managers

Frequently avoid discussing the “elephant in the room”, because they:

• Don’t have an answer

• Don’t want to put their egos/reputations at risk

• May not even know the elephant exists

• May have authored the “elephant”… a dated and failing strategy

Middle Managers
  • Possess key facts since they are “in the trenches” everyday vs. competitors

  • Have less ego involvement in the current strategic plan

  • Are fearful of contradicting/embarrassing senior management in meetings

TYPICAL CORPORATE RESULTS:
Same old, same old.


THE IMPLICATION: Failure is almost guaranteed in a highly dynamic world.