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Why focus on learning?
In today’s rapidly changing world, knowledge, experience, and skills quickly become obsolete. Your decisions and actions must be based on the current situation, not on what existed five years ago. What’s even worse is if your decisions are based on hopes, dreams, unvalidated assumptions, and missing or incorrect facts.
Ongoing learning is critical for long-term success.
The inability to learn is the root cause of many companies failing. “The assumptions on which the organization has been built and is being run no longer fit reality.”1 The approach of “don’t fix it if it isn’t broken” inevitably leads to “It’s too late to fix”.
Whether you are a Board Chair, CEO, or startup founder you need to constantly increase your value. This value increase requires constant learning.
Your success depends upon continuous understanding of evolving:
- Customer problems and needs. (Who are the customers and why should they deal with your rather than the competition?)
- Employee needs. (Why should someone work for you? Why should someone stay?)
- Competitors capabilities. (Why are customers dealing with them rather than you?)
- Investor needs. (Who are the investors, what are their overall goals,and why should they invest in you rather than others?)
- Needs of suppliers, the government, regulators and the general public.
- Needs, actions, and capabilities of other members of your ecosystem.
What is learning?
“Learning is about acquiring diverse, rare, and valuable chunks of knowledge through people, information, and experiences.”2 Learning must result in value. Knowing what everyone else knows is not enough – you need to know something that others do not. A changing world requires some diversity of learning. What you are focused on learning will change over time. The end result of learning is your company’s unique insights.
There are other types of learning, such as acquiring the skills to execute tasks.
What is the greatest challenge to learning?
Knowing the key questions to ask at any point in time. McKinsey states that the first step in strategy is asking “What are the right questions?”3 The right questions depend upon your current situation and the range of your potential futures.
What are the critical questions to ask?4
Both you and your company must ask similar questions:
- What does the world need? What is your purpose? Larry Fink, in his 2018 letter to CEOs, said “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate…..Without a sense of purpose, no company, either public or private, can achieve its full potential…..And ultimately, that company will provide subpar returns to the investors.”5
- What is your company good at doing? What do others believe it is good at? This can be very different from what your company thinks.
- What will people pay your company for? What is the value that others perceive that they may achieve you’re your company? This value may vary enormously.
- What do the Board, CEO, management, and staff love to do and are passionate about?
How do you learn?
The critical part about learning is writing down learnings. This forces you to think about what are the key learnings, and why these learnings are valuable.
- You learn about people by meeting them, talking with them, hearing them present, and reading about them. The implication is that you need a broad network of relationships.
- You gain knowledge through reading, courses, and seminars.
- Your experiences include new experiences on the job, courses, and volunteer work.
Answering the right questions requires facts and assumptions. Do the people in your company have a common understanding of the key facts and assumptions? Is this part of the new board director or employee orientation process? Are changes to facts and assumptions communicated to everyone who needs to know?
Learning is focused on gaining facts and validating or invalidating assumptions. You’ll initially make assumptions as to what the right questions are and what needs to be done to answer those questions. Over time, as you learn, you’ll revised the questions and the sets of supporting facts and assumptions.
Learning should be built into your company’s board and management processes. On a regular basis, or if an unexpected major event occurs, assess the current validity of:
- The key strategic questions.
- The facts and assumptions. This requires research and monitoring of your ecosystem, as well as asking questions of your stakeholders, and listening to them.
- The decision-making process, which is designed to both reduce biases and reduce reliance on obsolete knowledge, facts, and insights.
- The people involved with making key decisions, especially how current their knowledge, experience, skills, network, values, morals, and ethics are. How do you ensure that people remain current and are not getting obsolete.
Your coaches, mentors, and advisors should have a diverse background – learning requires diversity.
I have met many struggling companies and executives. Why are they in trouble? A combination of not believing they need to learn, and lacking the skills to learn.
1 Perter F. Drucker, “The Theory of the Business,” HBR.org, Harvard Business Review,1994 September-October issue, https://hbr.org/1994/09/the-theory-of-the-business
2 Michael Simmons, “The No. 1 Lifelong Habit of Warren Buffett: The 5-Hour Rule”
3 Chris Bradley, Angus Dawson, and Antoine Montart, “Mastering the building blocks of strategy”,McKinsey.com, McKinsey & Company, October 2013 ariclehttps://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/mastering-the-building-blocks-of-strategy
4 Jacqueline Brassey, Katei Coates, and Nick van Darn, “Seven essential elements of a lifelong-learning mindset,” McKinsey.com, McKinsey & Company, https://www.mckinsey.com/business-functions/organization/our-insights/seven-essential-elements-of-a-lifelong-learning-mind-set
5 Larry Fink’s 2018 letter to CEOs – a sense of purpose