You're in one of the toughest economic environments in memory and, like many companies, on a desperate search for a way back to growth. The normal reaction is to pull in your belt, hunker down, and hope that business will carry on as usual when the economy bounces back. But this can be downright arrogant and strategically myopic. It presumes that the past is a prologue to the future—that what made a company successful in the boom will serve well when things return to normal.
The problem is, "normal" is gone, never to return. Rather than causing despair, difficult times can be an opportunity to step back and do the critical thinking that will sow the seeds for future growth. I'm not talking about traditional strategic planning, but planning way up at the 30,000-foot level. Now is the time to consider a far-reaching vision for your IT function. If that vision supports your company's broader vision, you'll benefit mightily. If your company has no vision, seize the chance to show others what a vision can do.
I didn't always think vision carried much weight—even as a management professor and consultant to executives wrestling with the dynamics of organizational growth and change for two decades. When clients asked for help developing a vision, I was skeptical of any management trick-du-jour. I thought "the vision thing" was just another useless exercise.
I began a series of research projects that I thought would prove, once and for all, that vision had no impact on organizational performance. A year into the first project, I began to see some very surprising data—and I had to admit my working hypothesis was dead wrong. Research showed that a well-articulated vision implemented companywide had a profoundly positive impact on sustained growth. Contrary to my original belief, companies that first develop a vision embracing key themes of purpose, strategy, and values and then weave this vision into their corporate fabric perform better. Much better.
EasyGroup, the London corporation that operates EasyJet airlines, EasyCar auto rental, EasyInternetCafe (now also in the United States), and EasyCinema, is obsessed with using technology to reduce costs. The CEO's vision strategy demands that each new business focus on services with low fixed costs and price elasticity, and available for purchase on the Internet.
Each new business creates a signature offering that's no-frills and gives customers few choices. The core of this 30,000-foot strategy is to manage yield and adjust prices by the minute, to match demand. A seat on a plane, in an Internet cafe, in a rental car, or at a movie can be sold only once in any given moment. Information technology that processes yield rates is, therefore, the critical core competency. Chris Branagan and Phil Jones, CTOs of EasyCar and EasyInternetCafe, respectively, are strategic players because they lead a vision-critical function. EasyJet's sales grew 63% in 2002 and income rose 37%.
EasyGroup isn't alone in delivering on its vision. Publicly owned companies that use a vision to guide their growth have significantly higher market-cap growth and top-and bottom-line growth than competitors. While some executives may publicly opine that vision is a rather squishy concept, the research yields plenty of hard facts showing that companies with successfully executed vision processes grow better and over a more sustained period.
I found, for example, that as a group companies with a vision were twice as profitable as the S&P 500, and their stock price grew nearly three times the rate of the S&P 500. An analysis of average compounded total return found the visionary companies earning their investors 17.7% more than the S&P 500 overall.
