Crafting an Industry 4 Enabled Strategy

The following article is co-authored by Marcel Hattingh Ph.D. and Lourens Delport M.O.L.

 The word “strategy” is derived from the old Greek word strategos, which was mainly used within military contexts.  Strategos describes the big-picture battle-plan executed towards winning battles and wars.  Therefore, strategos refers to the deployment of all capabilities in a way that will assist the goal of winning (perspective taken from the NXTmove analysis report).  But what happens when the playing field changes without any warning? 

The story of the legendary Zulu king, King Shaka, and his conquest of Southern Africa is a well know historical fact; however, what would have happened if his opposition suddenly marched unto the battlefield with tanks and machine guns? Shaka would have been forced to abandon his, then modern, methods of the assegaai spear and shield for a more futuristic approach to warfare.

In today’s business environment, companies find themselves in the exact same position.  A new battle has presented itself: the 4th Industrial Revolution, more commonly called Industry 4.  A cunning foe which threatens to defeat those who do not adapt with the many unknown forces at its disposal.  Consequently, strategy development in light of Industry 4 requires a new kind of strategic leader; one who will also consider a new approach to the success and sustainability of their organisations. This future-fit approach can best be articulated as Organisational Mastery.

Exploring Organisational Mastery

What exactly is Organisational Mastery? Considering William Bridges’ work on managing transitions, the focus is that of a continuous dynamic and agile movement where leaders demonstrate the way into the future.  Mastering the complexities of your organisation within the 4th Industrial Revolution can therefore be best described as the need for leaders to continuously navigate the rapids of an ever-changing VUCA (volatile, uncertain, complex, and ambiguous) environment.

Consider the following picture:

Illustration 1 (free diagram) – Organisational Mastery Model (for more information on the model, please contact the authors)

As your organisation celebrates the current success within Industry 3, it cannot ignore the critical need to start gearing up towards an updated vision of a new preferred reality. This journey should include four key considerations of (a) the purpose of the journey, or as Simon Sinek popularised the concept of “The Why”; (b) the culture, as Jim Collins already noted in the early 2000s that it should first be who and then the what; (c) the strategy that is our path towards enduring success; and (d) our succession or reproduction process. Most of these components are nothing new and have successfully served organisations for many years. However, much of the current structural integrity, on which the organisation was built successfully in the past, will not hold the weight of the future business environment.

Building with an Accurate Structure in Mind

Does the following perhaps sound familiar – the board and/or executives go on a strategy breakaway for a couple of days and come back with an A-class battle-plan.  Excited about their vision for the future they share it organisation wide, only to give up on it after one fail attempt of implementation after the next? What are we missing? 

Upgrading a strategy can be compared to upgrading from a hunting rifle to a cannon. The problem is that one cannot fire a cannon of a canoe! You first need to upgrade your vessels’ infrastructure from a canoe to a battleship (refer to point 8 of Illustration 1). The canoe might have served the organisation well in Industry 3, but there are new rules to the game in Industry 4.

Image from www.canva.com

As such, a critical component for a successful strategy development and implementation towards Industry 4 includes the analysis of your organisation’s current structural in integrity. This is best achieved by making use of Industry 4 related technology and one such technology is an artificial intelligent system called NXTmove. The NXTmove analysis focuses on an organisation’s 20 structural integrity building blocks and how each compares with industry standards, as well as a global benchmark of approximately 60 million data points. Following the evaluation, the system’s integrated project management system assists the executives, of any organisational environment, on how to operationally upgrade their infrastructure to be Industry 4.0 ready.

As with any change, the upgrade will take time; however, an organisation can more accurately determine the critical infrastructure upgrades that will ensure they remain relevant in Industry 4.  Once the infrastructure has been given its due care, organisations can consider the strategy itself and how to best craft it within and towards a futuristic environment.  Industry 3 standards allowed us, quite often, to move directly from our own internal perspectives to design new objectives; however, within the current ever-changing environment, this will only be possible through a lens of a real-time reality check. 

Though there are many approaches, a simplistic, but highly flexible approach was proposed by Northern European consulting house – Xpand International. The Perspective / Reality / Objective (PRO) approach to strategy development ensures organisations cover all the bases. Accordingly, a more traditional approach was one of clarifying your current perspectives on the company, then moving to identify all relevant objects. The challenge with such an approach is that in a business unusual environment, we can no longer assume that we understand the realities; it needs to be tested!

Image from www.canva.com

The flexible nature of the PRO model offers us as leaders a backbone structure for strategy development that can be coloured with many practical workshops. Examples of these may include:

1. Perspective – (a) History, (b) Focus, (c) Dreams, (d) Vision, (e) Mission, (f) Engagement, (g) Core competencies, etc.
2. Reality – (a) Target groups, (b) Services, products, experiences (marketing matrix), (c) Finance, risk, legal (Boston matrix), (d) Environmental (STEEPLE), (e) Confrontation matrix (SWOT analysis), (f) Competitors, (g) Market position (Ansoff matrix), (h) Human capital capacity, etc.
3. Objectives – (a) Strategic scenarios, (b) Strategic concept, (c) Strategic goals, (d) Critical success factors, (e) Strategic projects, etc.

Completing this model on strategy development is that of strategic governance. An old African question jokingly asks how one eats an elephant? The response, one bite at a time! Strategic Governance is the process through which a PRO-G strategy is broken up into bite-size chunks, allowing for an effective and monitored implementation each step along the way.

Case Study

The begging question – how does all of this look in application? Recently, an organisation on the brink of collapse contracted the services of CCI Professional because the single-minded focus on the strategy had distorted their vision.  A major new cannon was designed with a projected transition period of five years. Halfway through the CEO resigned from his position because of the unforeseen amount of internal pushback. 

It had become clear that the organisation did not have the structural integrity in place to accommodate this new approach to the market. As an organisation, they had a good grasp on their perspectives, realities and objectives, yet lacked the advancement in structural integrity to execute this strategy. Following a qualitative inquiry into the process, it became clear that their break-point was a mixture of their organisational culture, leadership acumen and propensity towards change components.

Concluding Thoughts

This leads me to the closing thoughts of where your organisation might be at this point in time? Are you comfortable in your canoe with your hunting rifle, or have you already exchanged it for a cannon? A word of caution, if I may – ensure that you do not try and shoot a cannon from a canoe, as the effects might be devastating to not only your organisation but every person who is on that boat. Jim Elliot noted that “He is no fool who gives what he cannot keep to gain what he cannot lose.” As uncomfortable as it may be, the best time to reconsider your master battle plan interdependently alongside your organisation’s infrastructure was yesterday!

Image from www.canva.com

Post Script

This article was initially written at the end of 2019 for the BMS Network magazine. Unfortunately, due to the COVID-19 pandemic, the article remains unpublished. As a result, the authors decided to place the content in the public domain until such time when it can officially be published. The article was written by CCI Professional senior consultants – Marcel Hattingh Ph.D. and Lourens Delport M.O.L. Both authors have their respective doctorate and master’s qualifications in organizational leadership; a key enabler from where they lead various consulting projects within the field of organizational mastery. For more information on the development of an Industry 4 enabled strategy or the NXTmove system, please contact the authors – Dr. Marcel Hattingh, at [email protected] / +27 (0)83 608 7139, or Lourens Delport, at [email protected] / +27 (0)72 605 3118. 

Some concepts used within the authoring of this publication is in appreciation of Pieter de Villiers, head of the NXTmove research team. Additional references include:

• Bridges (2003). Managing transitions.
• Krige, Bester, De Villiers, Laubscher (2007). Future business: The game has changed.
• Schwab (2016). The Fourth Industrial Revolution.
• Sinek (2017). Find your why.
• Collins (2001). Good to great.