Manufacturers who are on the lookout for at least some clarity amid the surreal muddle of COVID-based uncertainties might have to get creative, according to Steve Haarstad, one of Enterprise Minnesota’s deeply experienced strategic planning gurus.
One of the most creative ideas in his toolkit is a what-if planning exercise called “prospective hindsight.” By using it, strategic planners conceive of hypothetical future events, and plot actions that will either minimize the potential damage (a “pre-mortem”) or enhance the possible opportunity (a “pre-parade”).
According to Haarstad, prospective hindsight shares similarities with open brainstorming, but by limiting the conversation to a defined event, the insights and solutions will be more concrete. “Hindsight is always 20/20; we can use this tool to change perspective and reframe the situation a little more broadly,” he says.
We will provide a deep look into Haarstad’s thoughts about strategic planning in the COVID economy in the upcoming issue of Enterprise Minnesota® magazine.
Let’s say you have recruited an exceptionally prized employee. She came to the company with a rare combination of talent and experience. She’s a motivated employee with a diligent work ethic and gets along well with coworkers. Lucky, right? But what would happen in six months if she unexpectedly walks into the boss’s office and submits her two weeks’ notice? The management team can use a prospective hindsight brainstorming session to consider the causes and consequences of that possible eventuality and ponder steps to avoid it or at least to minimize the damage. The net effect of the one-off possibility will likely have improved your overall attention to sharpen the company’s overall sensitivity to HR issues in general.
Planners will question her departure. Why might she quit? Did she get a better job? Was it closer to home? Did she get more money? Better benefits? Did her husband get transferred? Or did she simply want to change careers? If there are a couple dozen reasons for her departure, Haarstad says, probably half would be beyond your control. But others — circumstances a company can control — deserve forethought.
Did she dislike the good-old-boys culture on the shop floor? Did she have problems with an uncooperative coworker or manager? Did she feel job expectations were poorly communicated? Were her responsibilities evolving into areas she didn’t want to pursue? Did she feel overworked, underappreciated? Did she fail to see a pathway to promotion or expanded responsibilities?
A wise company therefore would use the circumstances of this real-world pre-mortem possibility to sharpen its sensitivities on a wide variety of HR issues.
“These are ways to discover problems inside your building,” Haarstad says. “If you know about them, you can act on them and hopefully prevent that negative event from happening. That’s the value of the pre-mortem.”
Planners can use prospective hindsight in other ways to reframe their company’s outlook, according to Haarstad. Consider this: Let’s say you operate a small contract manufacturer that provides machine parts and fabricated assemblies to OEMs. Last year the company earned $5 million in the second quarter. During the second quarter this year, however, you lost two major COVID-sensitive customers, which immediately sliced 25% from your profits.
Haarstad says company managers might mitigate that loss by imagining a “pre-parade” year-end event in which the company has found ways to recover the entirety of that loss. As they look back from their hypothetical future state, what might they have done to squeeze more revenue onto their income statement? Did they capture additional income from existing customers? Did they diversify their product lines or create new products to offer to new and existing companies? Did they identify cost-saving efficiencies in new or better processes? Did they reduce non-value-added expenses?
To learn more about Steve’s strategy model, look for a feature in the upcoming issue of Enterprise Minnesota® magazine due out on Sept.. 15.
You may also register for one of two Manufacturing Workshops Steve will conduct about strategic planning during the COVID-19 pandemic. Learn more and register by clicking below:
Strategically Navigating an Uncertain Future – October 6
Strategically Navigating an Uncertain Future – November 11
September 11 – Leading Through Daily Dialogue (part I)
Continuous improvement expert Greg Langfield will be demonstrating how managers can use CI to better communicate with shop floor employees and work smarter, not harder to meet customer demands. Online via Zoom Learn more and register
September 17 – Sustaining Daily Dialogue (part II)
Join Greg Langfield for part 2 of his Continuous Improvement workshop on how to sustain your CI efforts for long term success. Online via Zoom Learn more and register
September 9-13 – State of Manufacturing® Focus Groups
Manufacturing executives are invited to participate in the 2020 State of Manufacturing® Focus Groups. Choose a single session that fits your schedule, one hour in length. Online via Zoom Learn more and register
September 23 – Elements of Managing a High Performing Business: ISO
Expert David Ahlquist will show you how a business management system like ISO can provide the framework to stay in control of your organization and navigate change. Online via Zoom Learn more and register
See more upcoming events
Manufacturers continue to rebound, though Minnesota’s return at a slower pace
Although Minnesota is rebounding at a slightly slower rate, regional and national manufacturing output continues to improve according to Mid-America Business Conditions Index. Sept. 1, Star Tribune Read more
Red Wing Shoe Co. promotes jobs over boots for Labor Day
The heritage boot brand looks to hire 80 new employees and will promote openings for other companies as part of its new campaign. Sept. 1, Twin Cities Business Read more
– – –
Enterprise Minnesota is dedicated to helping Minnesota manufacturers grow profitably. If you are interested in receiving The Weekly Report to your inbox, please visit our subscription page.
Learn more about Enterprise Minnesota.