Jim Cramer talks about the powerful lessons learned from a recent copetition and how strategically managed firms use a setback as a platfrm on which to build for the future.
Will you have a stronger year ahead or will you backslide? Many firms are asking themselves this question as they assess their capabilities within the changing marketplace. The future offers new challenges for every firm. Every week several hundred firms learn they were not selected for a project that they were going after.
For instance, for its new $130 million Central Library, the Minneapolis Library Board recently shortlisted seven teams. But the firms who did not make the short list also make for an interesting story. Rejected firms include Michael Graves, Arquitectonica, Hillier, Ten+W (Enrique Norten of Mexico City), Julie Snow, Alsop of London with Cunningham Group and Leonard Parker/Durrant with James Polshek and Partners. The rejected firms are now looking at other opportunities while the seven finalists will spend considerable time and money during next level interviews. All the firms who submitted qualifications believed they had a shot at the commission, yet all but one will be rejected.
Consider the phenomena of rejection. Some firms miss out on strategic ideas because they don’t understand that markets and clients’ expectations are changing. Often, firms take a look at past experiences and then plan for next generation improvements. This assumes that change is incremental and linear. Change today is often non-linear and requires more than plans built around a firm’s past experiences.
The turbulence, threats, and complexity of A/E selection will likely increase in the future. Yet the opportunities in this future are gigantic. Firms need to ask themselves several key questions:
1. In what markets should we compete?
2. How should we compete in these markets?
3. Where do we allocate our resources, budgets, and investments?
The firm’s strategic planning should exercise imagination—not just traditional planning. These definitions help frame meaningful discussions on future success:
1. Strategy: A way to organize resources to achieve desired results
2. Strategic Thinking: Answers two questions: Where do you want to go? And how do you want to get there?
3. Value Creation: Transformation of human assets, client capital and firm assets through mutual collaboration, into true value. A direct result of how people generate and apply knowledge and design talent
4. Knowledge Flows: A firm’s internal and external flows of knowledge creating competitive advantage.
Identifying and sharing strategic potential is valuable because it builds a shared awareness of the firm’s situation. This leads to thinking about options and what types of strategies the firm should pursue. A top-performing firm will not likely abandon their market positions. An under-performing firm will need to change. All firms, though, want to step back from defeat, to put rejection into perspective, and to strengthen the firm’s capabilities to insure that its markets and building segments are currently attractive.
Everybody gets rejected—several Pritzker Prize winners have been rejected more often than you likely have. Babe Ruth struck out at a record pace—but also knew how to get results in other ways. Your challenge is to find the other ways that deserve exploration, decision, and inclusion in your strategic plan.