The Six Disciplines Of Strategic Thinking With Michael Watkins

There are The Six Disciplines of Strategic Thinking that business leaders should master. Strategic thinking empowers individuals to become successful in business and life. In this episode, Michael Watkins, the Professor of Leadership and Organizational Change at IMD in Switzerland and the founder of Genesis Advisers, outlines the core disciplines leaders should master for effective strategic thinking. He also touches on his seminal book, The First 90 Days, where he talks about the challenges of taking a new role and navigating through organizational transitions and change. Michael also shares his insights about Artificial Intelligence and what it holds for the future. But why does strategic thinking matter in the ever-changing world? Join Michael in this episode as he unveils the key to success.

Check out the full series of “Career Sessions, Career Lessons” podcasts here or visit pathwise.io/podcast/. A full written transcript of this episode is also available at https://pathwise.io/podcast/michael-watkins

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The Six Disciplines Of Strategic Thinking With Michael Watkins

IMD Professor And Best-Selling Author Of “The First 90 Days”

My guest is Michael Watkins. Michael is the Professor of Leadership and Organizational Change at IMD in Switzerland and the Founder of Genesis Advisers, an executive coaching firm focusing on accelerating transitions into new roles. He is a globally recognized transitions expert and the author of the bestselling book, The First 90 Days: Proven Strategies for Getting Up to Speed Faster and Smarter. He spent the last two decades working with leaders as they transitioned to new roles, built their teams and transformed their organizations.

In 2023, Michael was inducted into the Thinkers50 Management Hall of Fame. Michael has authored fifteen books on leadership and negotiation and hundreds of articles for leading business journals. He has a new book, The Six Disciplines of Strategic Thinking, that we’ll be discussing today. Before joining IMD in 2007, Michael was an associate professor at the Harvard Kennedy School and Harvard Business School. Originally from Canada, he studied electrical engineering at the University of Waterloo and Business and Law at Western University before earning a PhD in decision sciences at Harvard University. Michael, welcome. Thanks so much for doing the show with me today.

Great to be here.

I appreciate it. Let’s start with your current mix of work. You are at IMD Business School in Switzerland and you also have an executive coaching practice. Tell us a little bit, first of all, about the work and what you teach at IMD.

IMD specializes mostly in executive education. We have a small MBA program, but overwhelmingly, it’s EMBAs executive programs, both in the company and open. I teach one of IMD’s big open enrollment executive programs called the Transition to Business Leadership Program. I’m the co-director of that program. I also teach a version of the First 90 Days virtual program a few times a year through IMD. Basically, 50% of my time I’m at IMD these days.

You’ve got a coaching practice that you do as well.

After I published the First 90 Days originally, back in the early Paleozoic era, as I described it 2003, there was a lot of interest in getting people up to speed better and faster in roles. I was doing programs and coaching, and so we launched a company basically around the First 90 Days. Now, we do a bit more than that. We also do team acceleration. We do some transformational work, but the First 90 Days of transition acceleration is still a core part of what we do.

Who are your typical clients? It is a range of corporations?

It’s mostly global like Fortune500-ish type companies. We’re US-based, but we’re servicing globally. We’ve got a network of coaches. It’s mostly like that. It’s an ongoing flow of people going into new roles. One of the beautiful things about transitions is there’s always people going through them. It’s an evergreen business.

The Six Disciplines Of Strategic Thinking

You do a lot of writing. You have a new book out. It’s your 15th called The Six Disciplines of Strategic Thinking: Leading Your Organization into the Future. Let’s start with that. What was the spark of this particular book? What’s its overall message?

Before that, so you say fifteen books and that sounds very grand. I basically joked that I had one book that sold but now I think it’s close to a couple of million copies and fourteen books that sold like 50 copies each, so you got to keep this in perspective. I’m hoping for a better hit with this one. It wasn’t quite that bad, but you know what I mean. It’s always a bit of a challenge coming off writing something super successful.

One of the challenges I faced was, at the start do I want to take on something or should I keep on plowing the same furrow I’ve plowed for many years? The impetus was working with my own clients personally. I mostly coach senior execs taking new roles. My favorite group to work with are first time CEOs. You’re stepping up into the CEO role for the first time. That’s a big leap. One of the things you need to do is craft and execute the strategy for your organization.

What I noticed was there were some people that were  astoundingly good at it at the strategic thinking piece of it. Others were smart people, but there was something about the way they thought wasn’t quite as good as the folks that were outstanding at it. That got me interested in the subject. When I dug in, there’s so much that’s been written about strategy as I know you know well. I don’t think the world necessarily needs another book on strategy at this point. Although, I’m sure there’s new things that are being developed. A lot less on strategic thinking.

Lots on the strategy part, but not so much on the thinking part. What is the set of mental capabilities that let senior leaders effectively recognize, prioritize, and mobilize to deal with emerging challenges and opportunities? That was the basic starting point for me. If you’re going to be a senior leader in an organization these days, given the incredible turbulence that we’re witnessing on so many levels. You’ve got to be leading your organization and doing those three things, recognizing emerging challenges and opportunities early, prioritizing the right things to focus on, and mobilizing your organization to start to respond.

It’s a sense and respond dynamic. That was the way I anchored my thinking about this, right? Around that recognized, prioritized, and mobilized cycle. You’ve got some military experience that took me back to, a little bit to, the old OODA loop stuff of moving through response cycles quickly that came out of the military. From there, it was like, okay… What is the set of mental capabilities that let leaders recognize, prioritize, and mobilize? This, by the way, we can talk about, there are some things I include in strategic thinking that haven’t traditionally been included in strategic thinking, like political savvy as a core dimension.

That’s not something you’d see anywhere, probably, in discussions of strategic thinking, but it’s super important. That was the original impasse. It was working with these folks and like all these things, you’ve got to get your head around, can you make a difference with people or not? It’s just you have it or you don’t or you’ve got so much and that’s the end of the story. Good luck and God bless. It’s still interesting to look into why and what it is, but it’s not all that helpful if you can’t provide people with some guidance about how to get better at it. I do believe people can get better at it. We can talk about that later on.

We can come to that now and come back to some other things later. You asked the question in the book, are strategic thinkers born or made? You have a point of view, as you alluded to a second ago, that you can learn the skill. It isn’t that some people are naturally better at it, perhaps, than others. But others can learn it.

So, I have this little simple, you know, representation of the way I think about it, right, which is: your strategic thinking ability is the sum of your endowment, which is the mental machinery that you came with; your experience, that is, your experience doing things that exercise those kinds of capabilities; and the roles you’ve played in the past. The fact that you were encouraged to play chess as a child. I’m making this up, right? But there are things that exercise our capabilities… I’m sorry, are experiences that do that.

There’s this component I call exercise, which is like an exercise program. You can engage yourself in that can help augment your strategic thinking capability. For each of the elements of strategic thinking, I try to provide some ideas about how to do that and how to put together an exercise program to help you do that and help you get better at it. It’s like all great human capability. Is it nature? Is it nurture? Yes, the relative percentages we can probably debate. I used to teach negotiation a lot and I always felt like I could get people 10% to 15% better at negotiating.

You have that over a lifetime. I want a commission of that value creation. It’s probably something important. We’re not going to take someone who has very little inherent capability and turn them into a great strategic thinker, but we could take someone who’s pretty good and make them substantially better.

This is obviously important for companies. You mentioned, a minute ago, the increasing complexity of the world. How is increasing complexity making it more important?

I don’t know how you feel about the world as it currently is, but if there’s been a time where we face more large challenges and are experiencing more turbulence in history… I struggle to identify when that was. Maybe Second World War or earlier times where they were these great global chefs, but you take what going on with climate change and the pretty clearly accelerating issues we’re facing there.

I was reading an article a couple of days ago, a survey of AI researchers, about how soon they think AI will do everything better than humans, and it’s not that far off. There are some people that think it’s three years. Think about what that means. It’s the acceleration of AI, the amount of political and global turbulence. The wars that we haven’t seen. Major wars in places like Europe or the Middle East for a long time and there are very serious undertakings that’s going on. Supply chain issues or epidemics. We could go on and on but there’s an enormous amount of turbulence and very large challenges that business leaders face.

I don’t think strategic thinking is the only important capability to help navigate through that, but it’s certainly an essential one. I would add, for leaders, organizational agility and how you create organizations that are agile in the face of this. I would probably add personal resilience as a core capability. But if you’ve got someone who’s a strong strategic thinker, can create an agile organization, and is personally pretty resilient, we’re in the ballpark of what I think it takes to deal with what’s going on.

Certainly, there is a lot going on in the world geopolitically at the moment. Discussions around climate change and how quickly that will hit many other things as well. For me, the big thing that feels like it continues to happen is the pace gets faster. When we were limited by the pace at which you could travel distances and which you communicate over distance, things happened more slowly. You had more time to reflect and adapt.

You talked earlier, and you talk about this in the book, the “recognized, prioritized, and mobilized” cycle.

That cycle has to happen a lot more quickly than it used to. To me, that’s what makes it harder. It’s how quickly you have to iterate those cycles. Before we started recording, we were talking a little bit about school background and I remembered an exercise. It was like a simulation group exercise that we went through in school where you were managing a supply chain, and essentially, you got badly whipsawed if you didn’t manage it well by the end of the exercise because demand is moving, competitive dynamics are moving and if you weren’t positioning yourself to be able to adjust to that— this comes to some of the system-syncing pieces that you talk about in the book — if you weren’t adapting to that, you were going to end up losing the game. If you were able to figure out a way to adapt to those cycles more readily, you would end up doing well in the game. That was the whole point. That process is fast now.

You’re bang on. It’s not an accident that “recognized, prioritize, and mobilize” have the initials RPM. Moving around that cycle faster is, in and of itself, a dynamic source of competitive advantage. This is what you’re saying. I 100% agree with you.

Mental Agility

Let’s get to the six principles: pattern recognition, system analysis, mental agility, structured problem solving, visioning, and political savvy. We probably don’t have time to go through all of them, but let’s talk about a couple. Of the couple that I wanted to pick out, one was mental agility because it’s something which probably is a little bit vague as a concept. What does it mean to possess mental agility?

Maybe back up slightly. The first three of those, I think of as the fundamentals for the recognize and prioritize part of the cycle. If you can recognize patterns, you’re an engineer by training, see the signal in the noise, and understand what’s consequential. If you can think in systems terms so that you understand the action, reaction, feedback loops, and tipping points — that all helps a lot with that recognize and prioritize elements.

You’re bang on. Mental agility is a little bit of an amalgam of things. It’s two things that I decided to squash together, in part because they felt like they were connected and in part because I didn’t feel like they stood up to be chapters necessarily on their own. One is what I call level shifting, and that’s the ability to have — as a CEO I’ve worked with for many years calls it — cloud-to-ground thinking, which is the ability to look at things from different levels of analysis. See the big picture. Be up at 50,000 feet, dive down into the detail, pop back up to the key tactical issues.

It’s not just being able to move between those levels. It’s about being able to do so with intention. Being intentional about what altitude you’re flying at. That’s the way I think about it. That also, by the way, connects to an exercise you can do, which is a measure in a meeting, going from to the balcony as it were, and what’s going on in the big picture here down into the detail.

It’s an essential capability because you don’t want leaders who are stuck in the clouds. You don’t want leaders who can’t see the big picture. It’s that set of capabilities. It is an example of one that you can build up your mental muscle to do by self-consciously exercising and also asking yourself — back to the intentionality point: what’s the altitude I need to be flying at now?

Michael Watkins: You don’t want leaders who are stuck in the clouds and you don’t want leaders who can’t see the big picture.

You’re an experienced business exec. I’m sure you understand what that means. I’m sure you also understand what it means not to be flying at the right altitude. People are going, “Why is he stuck or mired in this detail? Or we’re talking up in the clouds. We’ve got to get concrete.” I’m sure you’ve seen examples of both those things.

I had not heard the phrase cloud-to-ground thinking before reading the book, and I liked that. Somebody I worked with long ago at McKinsey called it porpoising, using the analogy of doing what a porpoise would do, or whatever you call it. I like cloud-to-ground thinking better, but it’s that ability to operate up here when you need to and operate down here when you need to.

For me, that has always been something that I’ve valued because there are times, as you say, when you need people at 50,000 feet who can see the big picture to understand that there are other forces at work, and maybe they’re the ones that they’re most interested in. And then there are times when you need people to roll up their sleeves and get into the details. Being able to do both of those things is important. You link in gameplay as well.

That’s the other part of the whole mental agility piece. And it’s the second half of what I put together in that category. I was originally trained in decision theory, game theory, and negotiation theory in my PhD. I was an engineer originally before that. Engineering gives you the systems thinking intuition. It very much gives you the game thinking of action and reaction; of, “I make a move. What’s the counter move?” Thinking forward a few moves, reasoning back to what you need to do. It is, again, a mental flexibility or agility that you need to be able to do that.

Is it exactly the same capability that drives cloud-to-ground? Hopefully not, but there is something about your ability to shift between levels of thinking, look forward, and reason backward that felt connected enough to me. They are enough to package them in a chapter. The game thinking piece is super important. Again, there’s things you can do if you grew up playing chess. I did not grow up playing chess. It’s tremendous training for that thinking and it marries itself super well to pattern recognition because chess grandmasters see a chessboard in a way…

I don’t know if you’re a chess player, but they see things on a board that we don’t see. They see patterns, possibilities, and opportunities, but they’re also able to reason forward. I would think forward, “If I do this and this and this, things happen.” It’s, again, an essential capability for leaders to be able to anticipate competitive reactions and think about what’s the best move given the likely competitive reactions we’re going to face. That’s, to me, a pretty important capability.

Mobilizing People

It comes back to the RPM cycle, in a way, just being able to anticipate how people are going to play the game. Whether it’s chess or go or whatever the training might be that helps you get prepared for the business world. But there is definitely some value in that.

You talked about political savvy more in the mobilized part of the second three in your six. I had to admit, that one struck me as an interesting choice to put into the six because it didn’t feel like it was so much a thinking skill but it is an action skill. It’s an important one.

There are super important strategic dimensions to it. Before I was a leadership professor, I was a negotiation professor. I came off that experience doing decision theory, negotiation theory, and game theory. I taught negotiation at Harvard for many years, and then at the business school, before I got into the First 90 Days of Leadership.

The school of thinking in negotiation I came out of was called strategic negotiation. It basically embodied aspects of things like game and decision theory. A simple example would be, what’s the right order to talk to people to build momentum behind something you’re trying to do? Do I talk to you first? Do I talk to your key advisor on something first so that there’s a strategic logic to political savvy? But there are other important parts, like your emotional intelligence, your ability to intuit what people want and are looking for, and your persuasive abilities.

It’s not all strategic, but if you don’t have that political savvy, then you better have someone who’s pretty darn good at mobilizing or people who are good at mobilizing, or you’re not going to have the impact you want. It felt like it belonged. But it’s not an obvious choice. I agree with you. It’s a little… But it’s kind of fun because it leads to interesting conversations about it.

It made sense as I read through the chapter. You use a disguised example of a consumer packaged goods company with a matrix structure. It was a classic battle that you’d find yourself in if you ever worked in a big company and you had corporate functions. People wanted one thing, and the regional people wanted another thing. This particular protagonist was very much caught in the middle and had to figure out how to navigate through that politically.

You can be a fantastic thinker… It makes sense. If you’d asked me to write down the skills beforehand, I probably wouldn’t have listed that one, but it makes sense to include it because, at the end of the day, you can be the best thinker out there, but if you can’t get other people to come with you, it doesn’t matter.

It doesn’t. I agree, JR, 100%. Also, it goes to that mobilized bucket of things you need to do. When people think strategic thinking, mostly they think of the recognized prioritized elements. It’s like, “Am I good at pattern recognition? Am I good at negotiations thinking? Do I have the mental agility?” Those other three pieces, structured problem solving, that’s about leading your team through a process of making good rigorous decisions. That’s what that piece is all about.

A colleague at IMD and I have an article in the current issue of the HBR Magazine that is an extension of that. It’s about how you spend time framing problems well before you solve them, and giving advice about how to do that. That’s structured problem-solving.

Visioning is part of the strategic thinking cluster that one thinks about. But even there, it’s not just about creating a vision. It’s about how you enlist people in that vision. I use the term powerful simplification. How do you make it powerful and simple to pull people into that vision? How do you calibrate it? It’s ambitious and inspiring, but it’s got enough realism that people aren’t going to go like, “JR is off in hyperspace again.” Even with something like visioning, there is a necessary element of how you mobilize people around that vision, that is part of the back end of the book, basically.

Visioning, too, I think, is that ability to project forward 3, 4, or 5 years, maybe even more. It’s thinking about what you want to look like then and working backward from there. I find in my own experience that there are a lot of people who focus on the now-forward. They’re thinking 1 or 2 moves out, but they’re not necessarily thinking about where they want to be in the long term. And the ability to do that, and to work backward from that, and to lay out a path forward from there, is super important.

It’s an interesting discussion because there’s a whole school of thought about entrepreneurship that revolves around that now-forward thinking that you talked about. It’s like, “What are our resources? What do we have to work with?” It’s the Airbnb story.

The lean startup. All of those kinds of things.

The classic example is Airbnb. A couple of guys in San Francisco, a big conference in town, and no available hotels. So they’re renting out air mattresses on their living room floor but have a website to do it. They took a resource, and they moved. Did they start off with a vision of where they were going to go? Probably not. But equally important, to your point, and where the real power comes, is that you can also do that, look forward and work backward, thinking as well on how to mesh those things, ideally, together.

Endowment, Experience, And Exercise

You talk, at the beginning of the book, and you come back to it at the end of the book, about this formula of endowment, experience, and exercise to help somebody get better at doing this. You had some tips at the end of the book, particularly around how to get experience, because it’s hard sometimes to get yourself in a situation where you’re pushed to develop your strategic thinking.

Another colleague and I have an article in HBR, a digital article, about communicating like a strategic thinker. The act of talking like you’re a strategic thinker turns out to be super important. What’s the language you use? What do you focus on? How do you frame what’s happening? The points you’re making there are exactly right. How do you prove you’ve got strategic thinking capability if you’re not in a role that requires strategic thinking? It’s a little bit of a chicken and egg thing.

One thing you can do is to bring strategic communication and articulation to everything you do early. And that’s a way of demonstrating that you’ve got that capability. That’s a little article that extends that part of the thinking a bit more. And then exercise. I wrote a short piece about using simple online games to work on your strategic thinking capability. I play a few online games every single day.

I start with Wordle, if you know it. Yesterday I got it in three. Usually, I can get it in four. I’m super happy when I get it in three. I play another New York Times game called Connections, if you know it. It’s about sixteen words that you have to try and figure out their relationships. That exercises a different part of your mental muscle. I play a Washington Post game, that’s a word game. It’s like a form of crossword. There’s Sudoku.

I wrote this little article, basically, on “Here’s a little daily regime you can use just to keep your brain ticking over.” I’m not a chess player. My kids started playing chess on Chess.com, and I play my youngest son, usually badly, I should say. But there’s also a daily chess puzzle. I do it every day. I get in there, and it takes 5 or 10 minutes. Sometimes I get it, and sometimes I don’t. But inevitably, it gets me thinking about action and reaction; a little bit of an encounter move. But, one thing you can do is start to play games. And the games themselves are fun. And it doesn’t take that much time to do it. But it exercises certain parts of your brain.

There’s also lots of evidence that doing that has long-term brain benefits. It keeps dementia at bay and other things like that. There are other exercises. There’s one in the visioning chapter. I talk a little bit about an exercise that a colleague of mine introduced to me many years ago called the Architects Exercise.

The basic idea is: Anytime you enter a new space that you haven’t been in before, you step back, you look at the space, and you think, “How could I make the functionality of the space better? What changes would I make in the space, the furnishings, and everything that would make it a more attractive and usable space?” Much of this, to me, is like exercise. It’s like having that daily workout. You keep your brain ticking over in some way so that when you need to use those capabilities, they’re already warmed up, to a degree.

The First 90 Days

Good advice.

I want to switch gears and talk about the First 90 Days. As you said at a few points during the conversation, it’s the book for which you’re best known. Did you have any idea when you wrote it that it would become such a seminal…?

No, I describe myself as the accidental guru because I didn’t ever imagine that this would happen. It happened at a funny time, too, because I was up for tenure at HBS and didn’t get tenure, but almost simultaneously, the First 90 Days was published and went on the Business Week bestseller list, which was then something that people paid attention to for like 18 weeks or something. I was disappointed. I didn’t get tenure. I was like, “What am I going to do with myself? This thing’s sticking off like a rocket.”

That’s when I founded my leadership development executive coaching company. But no. I just happened to catch a wave. And the timing, as you know, I’m sure, very well, there wasn’t much out there about how to take charge in a new leadership role. There was plenty about leadership and change, but that real incredible challenge of taking a new role, getting yourself up the learning curve while simultaneously having an impact in the organization… There wasn’t much there.

Also, what I think helped a lot was that I published a previous book on a similar topic a few years earlier. Johnson and Johnson had come to me to develop programs for their execs around that content. This is pre-The First 90 Days. I spent a couple of years going around the world teaching programs to directors of EP-level folks taking the roles. I refined a lot of the ideas just by virtue of interacting regularly with groups of people taking new roles.

The STARS model — start-up, turn-around, accelerated growth, realignment, and sustaining success — the idea that the way you transition depends on what you’re up against came out of those programs. The First 90 Days was almost a distillation of all of what I’d learned from doing that. That made it super practical. It made it something people could grab and say, “This is going to help me make sense of this. Organize myself to be successful in these transitions.”

I have read a lot of business books over the years. Some are dry, and some are very story-oriented. The ones that tend to probably do the best are the ones that are a mix of… they make one intriguing point. They weave a story and examples around it, or they are just practical. To me, The First 90 Days is ten pieces; there are frameworks for each, and there’s practical guidance for each.

Often, when you’re coming into a new job or a new organization, particularly if you’re a senior leader, all the eyes are on you. You’ve got to accomplish a lot every day. Having a playbook and a framework for a playbook, which is what this provides, for me, certainly hits the mark in terms of what a lot of transitioning leaders need because it gives you useful guidance that you can distill, digest, and incorporate right away.

Thank you. I have my little joke about this. I say, “There are too many business books that should be articles. And there are too many articles that should be paragraphs.” One characteristic of my writing is there tends to be a fair amount of substance to each chapter that I write. If I’m going to write a chapter on accelerating your learning when taking a new role, it’s going to be fairly deep but useful. There’s a chapter on how to match a strategy situation, then on building alliances…

There’s something about the way I write and think. Maybe it’s the engineering training, partially. Probably not partially, but substantially. This book that we were just talking about, The 6 Disciplines is somewhere… Each of those chapters, to a degree, stands on its own. They’re connected, but they stand on their own as a reasonably deep but practical dive into something important.

The other thing I’ve always tried to write about is things that have eternal leadership significance. Leadership transitions have been going on from the beginning of human experience. People have negotiated from the beginning of time. People have had to think strategically too. It’s particularly important, given how fast things are happening, to try and find those things that remain eternal leadership capabilities and focus attention on them. Another thing I’m interested in these days is leadership presence. What does that mean exactly? It’s something I’m thinking about.

In the 20 years since you first wrote the book, have your own thoughts on successful transitions evolved a lot over time?

The first edition was in 2003. The second edition was in 2013. The book was probably 40% new content for the second edition because a lot had changed in the intervening ten years. As for the last ten years, I’ve currently writing the third edition, so I’m thinking a lot about this. Many things have changed. Like, remote work. Back then, no one had any notion of what it meant for remote work. To your point earlier, the pace at which things are happening. I sometimes joke that it’s not the first 90 days anymore. It’s the first 90 minutes.

The way we think about teams has changed. The whole rise of the importance of psychological safety in teams has changed. In the intervening years, I’ve also written dozens of articles about dimensions of this. For example, in the original book in the second edition, there was a chapter about securing early wins. That was mostly about how you pick the right things to focus on to drive your momentum, but there’s a whole piece there about how you arrive well in a new role, leverage your brand, your leadership brand, have the right presence coming in, and build credibility early.

That’s going into the new version of the book because I hadn’t thought deeply enough about that piece, but it’s super important. Using the 90-day cycles on an ongoing basis is another thing that’s going into the new edition of the book. How do you manage your business in 90-day sprints? What does that look like and need? I have some new ideas about how you establish direction. I’m very interested these days in leadership as mobilizing, focusing, and sustaining energy in organizations.

That energetic idea is something that’s going to be very much infused in the new edition that wasn’t in previous editions. It’s stuff like that.

The big challenge I face, by the way, is not overpacking it with a bunch of stuff. When you’ve written dozens of articles about different pieces of this, the tendency is to say, “Let’s take all those pieces.” If I have one big worry about it, it’s that I make it too complicated. There’s a balance. There’s clearly an important balance.

There’s a balance. I’m guilty of that, sometimes, of trying to pack too much into an argument. And you have to keep it distilled down. It comes back to some of the things you talk about in your current book: if the message is so complicated that people don’t understand it — this is in your visioning chapter — if you can’t bring people along with you in that vision in a way that’s clear, compelling, and simplistic enough, then you’ll lose them.

Coming back to this, that’s what makes a good business book. If the book’s too complicated, you lose people in it. It’s interesting, this idea of business presence. It’s been about two and a half years since I joined the company that I’m with now. I thought a lot about how I wanted to come in. How did I want to represent myself? How did that build on the way that I had worked in the past? What did I want to do similarly? What did I want to do differently?

That was a consideration for me. And that’s different from many years ago. To your point about how the way you manage and lead teams is different, the concept of psychological safety. The command and control era of leadership, to me, is rapidly dying off. Probably still out there in some industries, but it’s largely gone. It’s a much more complicated leadership environment than it used to be. You have to think a lot about you. Not just the task, the culture, and your boss…

And how you show up! And how you show up every day. 100% agree.

Also, Gen Z and beyond; the importance to those younger people of a sense of purpose and inspiration in what they do. You’ve got to adapt to that as a leader. I worry a little bit about those generations given the challenges they’re likely to face today, but it is important for many leaders that they have and are able to communicate a sense of purpose in what they’re doing because that’s a core part of what’s engaging those younger workers.

Michael Watkins: It is absolutely important for many leaders to have and be able to communicate a sense of purpose in what they’re doing because that’s a core part of what’s engaging those younger workers today.

Coaching People On Transitions

Very much so.

You do a lot of coaching of people on transitions. Are there pitfalls that you see or traps that they often fall into that you would want to share in terms of what to do?

Interestingly, those haven’t changed that much over time. Marshall Goldsmith wrote a book, I’m sure you know it, What Got You Here Won’t Get You There. That’s the biggest one: thinking that you’re going to be successful doing what you’ve done in the past, only more of it or better. Not recognizing that you’ve come to those moments when what got you here literally is not going to get you there.

You need to step up with a different set of capabilities. You need to let go of some things that you’re maybe good at and love doing. Embrace things that maybe you don’t feel quite so comfortable with. It’s a variation on the comfort zone trap. It’s the number one thing I see. The other one, I call it the action imperative. The sense that you have to take action. You have to do something. You have to prove to them, whoever they are, that they made the right choice in putting you in the role.

You have to be realistic. You do need to move quickly. There are things that you can’t put off happening, and it’s dangerous to do so. But too often, I see people starting to make early calls or try to put their stamp on things or make decisions where they’re not as informed as they need to be. The pressure to do that is coming from inside them as much as anywhere. That notion of the action imperative is an important one.

There’s one other thing that’s related to the political savvy chapter in the matrix organizations you describe, which is not building lateral relationships early enough. Not reaching out to your peers and not reaching out to those key stakeholders. Not investing early in building that network. And focusing too much on the vertical. Those would be some examples.

Some of those things you mentioned, I know you wrote the book with more of a C-level and senior leader in mind, but for anybody joining a new company or taking on a new job, a lot of what’s here applies. The stakes might not be quite as high because you’re not perhaps in as big a role or senior role. A lot of the same principles apply. One of them certainly is: coming in and being too narrowly focused on, “This is my team. This is my boss.” Managing vertically without thinking about the horizontal and the relationships that you build across the organization. If you fail to do that, when you come into a new organization, you’re going to hinder yourself in the longer term.

For people coming in from outside organizations, culture is a huge issue and understanding that organizations do have cultures that are different. You alluded, when we were talking earlier, about the difference between military culture and business culture. That’s an enormous difference. People coming from the military and the business can struggle. So, too, can people that come out of a more command-and-control-ish type organization into a much more lateral agile organization.

Where I see people really struggle is the first time they make a major shift from one organization to another with a very different culture because they think this is the way it is. They think this is the way organizations work, and they discover that “Wait a minute. No.” There’s an example — I don’t use the example anymore as much, but I’ve done a lot of work historically with Johnson & Johnson. It’s a great organization and very relationship-focused, especially at the top.

You’d see someone coming in from, let’s say, GE in the old days. They come out from this very process focus, much more command and control organization. They hit this brick because they started saying things and meetings and making what they thought were good points, and people often didn’t last as a result. Again, there are a few jokes that used to say that you should always hire people from GE on their second job after GE because someone else has sanded the corners off them a little bit.

Culture is critical when you’re onboarding. When you’re being promoted, it’s a different set of challenges. The biggest ones often happen when you’re promoted in place, and you’re leading for peers. That’s a big one. Leading people who were formerly your peers is a very big challenge often because you’ve got to completely change the nature of the relationships. You may have people who thought they should have the job and people who honestly are good friends, but the relationship has to change. Part of what’s fascinating for me is how many different types of transitions there are and how each one has its own logic to it.

There’s a book called The Making of a Manager by Julie Zhuo. She talks about the different ways that you can become a manager and how it matters. Again, she’s thinking about first-line managers, but whether it’s first-line, second-line, or C-level, the different ways in which you can move into those roles drive the transition. If you’re all of a sudden leading your peers in the same organization or if you’re in a new organization… In some ways, it comes back a bit to this piece you want to include in your new addition around business presence and leadership presence. You have more degrees of freedom, in a way, when you move into a new organization than you do in an existing one and that matters.

It absolutely does. Another example I use sometimes is when your boss is promoted, and you’re promoted. You’re still reporting to the same person, but you’re now leading the organization they used to lead. There are some things you feel like aren’t working and you need to change but you’re telling the person who led the organization before you do that their baby isn’t beautiful. It’s endlessly fascinating, JR. Even after many years, I’ve spent doing this transition, it’s still fascinating because there’s so much nuance to it.

It’s fun. It’s coming back to this idea of playing games and learning. You balance the day-to-day with what you’re learning yourself.

I know you do a lot of writing and thinking about topics. What are the ones that are particularly top of mind for you now, outside of the content of your latest book and this new edition of the First 90 Days?

The AI Revolution

I mentioned one already, which is leadership presence. I’m pretty interested in that and how we think about what it is and how it develops. Unsurprisingly, like everybody else on the planet, AI is pretty interesting to me. I wrote an article about different levels of human capability that are going to be taken over by AI over time. I’m trying to think about how that’s likely to evolve and how businesses can plant against that very dynamic evolution.

What I worry about there, and again, this is going to make complete sense to you. I see lots of organizations dealing with AI as if it’s static. “We’ve got chatGPT or chatGPT4. How do we adapt to chatGPT4?” Important question, but equally important is, “what’s chatGPT5 going to look like and 6, and 7 and 10? How quickly are they going to happen? What capabilities are they going to have? What’s that mean for how we need to think strategically about our organization or workforce?” There’s a real danger of getting caught in reactive planning as opposed to something that’s more proactive and anticipatory. I’m working on a piece of that with the CEO that I do a fair amount of work on.

AI, certainly in my industry and any industry, you can’t help but think about it. You have to contemplate how you use it, how you control it, and how you deal with the human consequences of it. I’m not sure where I fall on this idea of whether it is going to take over the world or if it is going to massively make life better for the humans in the world. I don’t know. We’re going to have to steer it in a way that works for humanity. Otherwise, it’s not a force for good.

I have to say, I’m a little bit on the pessimistic side of this, JR. I do lots of work with pretty high-level scientific folks. There’s going to be an incredible discovery that’s going to flow from this. We’ve already seen some of the incredible discoveries in medicine and many fields. That’s the good news, but the bad news is potentially pretty bad. I don’t get caught up in the “Is this thing going to kill us?” kind of modality.

I guess it’s possible, but it doesn’t feel like that’s highly likely at this point. What I have more focus on is, what’s the impact on employment, society, and political stability? I’m going to read you something. There was a study that was released just a couple of days ago. Tt’s a big survey of AI researchers about their forecasted views of what’s going to happen. 3,000 researchers. The forecast given is a 50% chance of AI systems achieving milestones by 2028, and they list what those are. “If science continues undisrupted, the chance of unaided machines outperforming humans in every possible task was estimated to be 10% by 2027 and 50 % by 2047.” That’s mind-blowing, JR! That’s every human capability, as early as three years from now and maybe as late as twenty years from now.

I hope it’s twenty years because if it’s three, so much of this is going to be driven by how much time we have to adapt. The biggest variable that’s going to determine the level of disruption is how long it is going to take. How much time will we have to adapt?

People call this a general-purpose technology like electricity, light, or steam. Those technologies took decades to have their impact fully felt in the end. There was a time for adaptation. People could move to new occupations. You could reskill people. If we’re talking three years until every human capability, that’s revolution.

We tend to believe that the capabilities are going to move much more quickly, perhaps, than the broad implementation of those capabilities. This is going to be a constant threat that plays out. It’s a bit like automation played out in the factor world starting many years ago and the way that offshoring has played out in the business world. This is just another one of those big trends that will play out perhaps over a few decades but will be a constant headwind for people who aren’t prepared for it. That’s the thing I probably worry the most about is that this is yet another thing that puts pressure on the part of society that isn’t able to adapt as well and how does that end up driving political changes and everything else?

I know we’re almost out of time, but the other thing is there’s a problem I call the “Nowhere to run, nowhere to hide” problem. That’s a little song title. When human power was overtaken by mechanized power, people moved to factories and dexterity. They assembled things and did things that machines couldn’t. Automation came along and did this. People moved into service occupations or intellectual occupations.

There was a movement to new places where people could still do useful things. I don’t see any place to go. I don’t see any place for all those people that are going to be displaced by AI. I don’t see anything for them to do. You saw, what I read, all human capability is able to be done better by unaided AI.  That’s huge.

We will see. It’s probably a stark note on which to leave…

The human ingenuity and adaptability, you don’t want to bet against it. It could mean a lot of disruption and a lot of difficulty, but in the long run, I’m pretty confident the species will survive and get through it all. But there may be some bumpy road.

We covered a lot of ground. We didn’t cover anywhere close to my long list of questions, but perhaps a conversation for another day. Thank you. I appreciate you doing this.

I enjoyed it a lot. Thank you.

I hope this new book becomes the next First 90 Days.

If it does, 25% as well. I’ll be happy. Let’s put it that way. In my dreams, it does super well, but we’ll see. But thanks so much.

Have a good day, Michael.

You too. Take care.

I’d like to thank Michael for joining me to discuss his work, his new book, The 6 Disciplines of Strategic Thinking, and his most well-known book, The First 90 Days, as well as thoughts on leadership and a little bit on artificial intelligence, some of the other trends that are affecting the business world at the moment.

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About Michael Watkins

Michael Watkins is the Professor of Leadership and Organizational Change at IMD in Switzerland and the founder of Genesis Advisers, an executive coaching firm focusing on accelerating transitions into new roles. He is a globally recognized leadership transitions expert and author of the best-selling book The First 90 Days: Proven Strategies for Getting Up to Speed Faster and Smarter. He has spent the past two decades working with leaders as they transition to new roles, build their teams, and transform their organizations. In 2023, Michael was inducted into the Thinkers50 Management Hall of Fame.

Michael has authored 15 books on leadership and negotiation and hundreds of articles for leading business journals. He has a new book, The Six Disciplines of Strategic Thinking, that we’ll be discussing today.

Before joining IMD in 2007, Michael was an Associate Professor at the Harvard Kennedy School and Harvard Business School. Originally from Canada, Michael studied electrical engineering at the University of Waterloo and business and law at Western University, before earning a PhD in decision sciences at Harvard University.