Peripheral vision is the ability to detect market trends and weak signals beyond the current boundaries. In a rapidly changing business environment it becomes a critical asset for strategic thinkers.
For the human eye, peripheral vision is the ability to see objects and movement outside of the direct line of vision. It is made possible by rods and nerve cells located largely outside the centre of the retina. The rods also create night vision and low-light vision. A loss of peripheral vision leads to a condition commonly referred to as “tunnel vision”.
Translated to a business, peripheral vision is an ability to detect market trends and weak signals beyond its current boundaries. While a focus on current business activities helps in effective execution of business strategy, it has the downside of creating tunnel vision. As a result, leaders can miss the important trends that can lead to missed opportunities, disruption to their business or even a crisis of survival.
The case of Blackberry provides an example of one such scenario. Enamoured by its famous keypad and highly focussed on its valuable business customers, Blackberry was blindsided by the entry of the iPhone from a consumer-centric Apple with its all-touchscreen interface. Blackberry first ignored then dismissed the threat, in the belief that its enterprise users would always prefer their tactile keyboard and superior messaging service.
Led by its founder, an electrical engineer, the philosophy of Blackberry was focussed on incremental improvements to what it believed was its superior hardware. This blinkered them to the prospect that software was transforming the functionality and user experience of the smartphone. The result was that Blackberry went up a strategic dead-end, only changing its approach once Apple and Android had created a huge consumer market and successfully begun converting its treasured business users. By which time Blackberry had already lost the race and became a marginal player.
To remove these blinkers and realise the power of peripheral vision, effective strategic thinkers follow three key steps - they actively scan the periphery, spot the weak signals which others may miss and respond proactively to market trends.
Scanning the periphery
Strategic thinkers continually and actively scan the periphery to identify threats and opportunities for their organisation. These thinkers are acutely aware of what is going on outside their business, and even outside their industry.
First, they tune in their antenna to detect and capture information emerging from the periphery. We have found that effective strategic thinkers are highly diligent about building their own network inside and outside the organisation. This includes leveraging the power of informal networks to tap into different sources of knowledge that others may not have access to. These informal sources have the added advantage of being less constrained by organisational hierarchies that may censor the information that flows to the leadership due to factors like internal politics and ego.
Secondly, strategic thinkers don’t just rely on their individual powers of observation and networking, they develop robust market intelligence systems within their organisation to regularly capture, analyse and interpret information, and then feed it into their company’s strategy development process.
Finally, they tap the power of the internet and new technologies. We increasingly find that leaders have become adept at using social media to stay connected and be informed from a wide variety of sources. This ensures that they are always ‘in touch’ with sources of new information.
Spotting weak signals
Very often the signals picked up on the periphery may at first be weak, making it difficult to distinguish important indicators of change from other background interference. To distinguish important signals from the background noise that their systems pick up, effective strategic thinkers look for multiple trends and a variety of sources to see patterns which can be masked by looking at individual signals in isolation.
Take the case of scooters in India - when the market had shifted to motorcycles, few companies thought of bringing the scooter back into the market. However, Honda spotted the weak signals from the increasing number of women in the workforce, the rise of small towns and the mobility desired by the new generation. It introduced Honda Activa to tap the seemingly peripheral demand and shifted the landscape of the two-wheeler market in India.
In assessing signals, an organisation may dismiss any new information that challenges prevailing assumptions and mental models. Paradoxically these signals are often the ones that pose the greatest threat to the business.
To mitigate this risk, effective strategic thinkers bring a diversity of mindsets to the problem. Contributors are made aware that there are no sacred cows in the process and they are encouraged to argue the case for competing visions of how emergent trends could play out and impact the business. They also ensure that communication barriers between different departments are lowered, as for example sales may possess the latest information about emerging competitive threats, while R&D teams may be most aware of emerging technological shifts that could upend the industry.
Even where signals are picked up and their significance for the business is correctly identified, inertia and routine thinking can be an impediment to taking timely action.
Once important threats or opportunities have been identified on the periphery, it is the responsibility of leaders to ensure that fast action is taken. The risk is that organisations can fall back into their routine method of decision making. Alternatively, they may suffer from paralysis by analysis as they seek to gather all the possible data points about the signal.
One way to break the inertia is creating a system of “decision days” over the year. These decision days can act as a cut-off date which forces people to make a decision. During these days, relevant people join in and discuss the identified signals and their implications to make a decision. We have found that having these type of meetings moderated by someone who doesn’t have a stake in the decision can galvanise managers towards taking action.
With rapid advancements in technology and an increasingly complex business environment, the number and the potency of threats to existing business models have greatly increased. Peripheral vision can prove a critical asset for strategic thinkers in these fast-changing times.