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Brain circuits

An exercise to test the flexibility of your strategy

Published 29 December 2022 in Brain circuits • 2 min read

At the core of any business strategy is making a bet on what you believe the future to look like. It is necessary to take a stance, but, like any investor, companies need to hedge their bets. Smart companies create options for themselves not just to hedge, but to capture outsized upswings as well. To create options, you need a strong viewpoint even if it’s inaccurate.

Without a viewpoint, you can’t allocate resources. You can’t build new capabilities. Allocating resources requires substantial logic and rationale. But then again, your mental models need to be continuously updated. For a company, what’s needed when making a strategic choice is this: have a viewpoint widely shared, but fully acknowledge the inherent uncertainty.

The exercise

So, today, try a simple exercise. Look at your current strategy and where you have placed your resources. Involve your whole strategy team. Now ask yourselves, if your bets prove to be wrong, and the future presents a completely different reality, what would you do? Gameplay it.

This sounds absurdly commonsensical, but most companies actually do the opposite. Managers go through the most excruciating data analytics based on history, declare a bold move, align the entire organization for its implementation, and then never look back.

Success from insecurity

It is exactly this kind of paradoxical thinking that drives success where change is constant. Survival takes an inner insecurity that propels a CEO to become forever vigilant. Being vigilant means doing everything to prevent disasters, despite having a strong viewpoint on how the future will look based on your best educated guess.



Howard Yu - IMD Professor

Howard H. Yu

LEGO® Chair Professor of Management and Innovation at IMD

Howard H Yu is the LEGO® Chair Professor of Management and Innovation at IMD and the Director of IMD’s Center for Future Readiness. He is the author of the award-winning book LEAP: How to Thrive in a World Where Everything Can Be Copied. Howard directs our Future Readiness Strategy and Business Growth Strategies programs.


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