Assessing Organizational Opportunities: The Sigmoid Model

In the past month, a surprising amount of my consulting discussions have focused on something called the sigmoid curve. This is unusual because the sigmoid is actually a mathematical principle, an area that is not my specialty! However, this math concept provides organizations with some rich insights about what they can expect on their organizational journey.

The term sigmoid means ‘S-shaped’. It is derived from the sigmoidGreek alphabet letter sigma which is in a shape that is similar to an ‘S’. The illustration on the right reveals what a basic sigmoid curve looks like. While this model has strong math applications, it has evolved in its use in many other areas of life. Specifically, my recent discussions have focused on how sigmoid ‘S’ shape reveals business insights about the life-cycle of organizations.

The core lesson from the sigmoid curve is that all good things end. For example, the chart on the right applies the sigmoid to business development. It reminds us that our organizations go through various phases. It begins with relatively Sigmoid Businessflat progress when a company is launched (the inception stage). However, over time, a well-run organization will eventually reach a period where growth occurs. This will continue as organizations reach maturity in their processes. However, at some point, organizational decline is inevitable.

Successful organizations learn to launch a second sigmoid curve when the company is in the maturity stage. Adding a new product, acquiring a competitor or shifting strategy are some common ways that this occurs. The chart on the right demonstrates what launching Sigmoid 4a second sigmoid looks like. In fact, successful organizations will launch several sigmoid curves over their lifetime.

For example, Kodak was once heralded as the global leader in photography. However, in 2011 they filed for bankruptcy after 123 years of operation. The key to their demise was an inability to adapt to digital photography. Their business model had quietly matured to a point of decline that could not be halted. Their inability to launch a new sigmoid curve during their mature stage led them to a point of no return. In contrast, their competitors learned how to launch another sigmoid curve before they hit the decline stage.

Once you are aware of this concept, you will find that our business world is full organizations that are launching sigmoid curves. Facebook has invested heavily in virtual reality as they believe that this will be a key to their future success. As I ordered my morning coffee at Starbucks a sign invited me to come back for a glass of wine and an appetizer after dinner – another sigmoid curve is being launched. In the 2008 election, President-elect Obama used social media to redefine the political campaign process and created a sigmoid that is still being replicated.

Sometimes sigmoid curves work (the Carl’s Jr. hamburger franchise began by purchasing a hot dog cart) and sometimes they do not (anyone remember McPizza’s?). However, you can be confident that your organizational plans will decline at some point. The key to avoiding the decline stage is planning change when things are going well. Unfortunately, the maturity stage often creates a false sense of security and an unwillingness to change. But as Kodak reminds us, not changing is even more costly than the pain of change.


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Jeff Suderman is a futurist, consultant, and professor who works in the field of organizational development. He partners with clients to improve culture, leadership, teamwork, organizational alignment, strategy and organizational future-readiness. He resides in Palm Desert, California. Twitter: @jlsuderman Email: jeff@jeffsuderman.com

Are you Do–>Think or Think–>Do?

The ability to understand the unique ways people think, act and learn allows us to be more effective in our work and personal lives. As I consult, one of my favorite filters to help me do this is determining whether people demonstrate a preference for thoughtfulness or for action. I have dubbed this the ‘do–>think or think –>do’ test.
This concept was developed while listening to a presentation by Robert Moran (Brunswick Group or @robertpmoran). As he discussed an organizations strategy, he used think/do or do/think to define the two strategic options of the company. I have borrowed and extended this principle as it also applies to human and organizational behavior.
Think of some of the people that you interact with regularly (including yourself!) and ask yourself which one of these two categories fits best:
1. Do–>Think: These people are action oriented and like to get their hands dirty. They get to it and are comfortable working with an imperfect plan. Once things are underway or completed, they assess what they have learned and how to improve it.
Example: As I taught a board game game to a group of people this weekend, Ryan interrupted me two minutes into the rules and asked, “can we just begin playing and learn it as we go?” He demonstrated a strong do–>think tendency.
2. Think –>Do: These people prefer to begin by thoughtfully considering what needs to be done. They consider options, line up their priorities and then systematically work their way through them. They are not afraid of action, they just want to spend time on the best ones.
Example: I am teaching some on-line Master’s level courses this fall. The think–>do students in my class are sending me emails in the first week asking for clarification on paper requirements (and also sending in a draft for review prior to submitting the final paper).
We fluctuate between both of these modes of operation each day. Certain circumstances lend themselves more naturally to each of these styles. For example, contrast the difference between the development of a five-year strategic plan versus assembling your child’s new toy. Or perhaps at the height of your busy work season you may not have time to think/do. Sometimes circumstances will dictate our preferred method.
However, I believe that each of us also has an innate bias. I need to tackle large problems with time to think and ponder. In contrast, some industries move so quickly that they often need to be more do/think (think of technology and apps). This filter has helped me understand that I need to shift my preferred style at times in order to work more effectively with the do–>think people or to get work done on a tight timeline.
Here are some ways to apply this principle:
  • Assess the members of your team and identify their tendency.
  • Discuss this model with them and ask them to identify their own tendency? Is it the same as your observation?
  • Identify the person you often conflict with at work. Could your conflict stem from a different do–>think or think–>do orientation?
  • Review whether you identify the style which is different than your own as ‘wrong’ or ‘different’?
  • Determine how having different styles will help you and your team.

There is no single filter that helps you understand a person perfectly. However, the do–>think or think–>do is one tool which is easy to use and often provides you with quick insights about how to best work with a person.


 

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Do Your Organizational Values Have Legs?

I love it when organizations have clearly defined values. I love it even more when you see those values exemplified in practice. However, the opposite also occurs!

A friend recently told me about a less-than-positive experience during her new employee orientation. She works as a nurse and was hired by a well-regarded hospital. Their orientation blended new staff from every department and role. boxed lunchIn this particular orientation, there was a new cohort of medical doctor interns. At the catered lunch, my friend took a lunch box from one of the two tables in the room. As she took the lunch, she was told that these lunches were only for the interns and that she needed to take her lunch from the other table. Attendees observed that the interns received a higher quality lunch and a clear hierarchy was silently established.

For an organization touting the values of respect, integrity and professionalism, there was a gap between what was stated and what was practiced. Shane Atchison purports that organizations which post their company values all over their walls have serious culture problems. In other words, a company’s values need to be lived, not talked about. While it is easy to point a finger, there are few of us who have not done the same thing over our lives.

Which value is the most difficult to practice in your organization? Where do you have opportunity to tighten the gap between what you preach and what you practice? If you don’t know, I’ll bet your employees do!

Focus: Finding Strategic Clarity

Marcus Buckingham has made a name for himself by reminding us to focus our lives and work on what we are good at. The Strengthsfinder© model has become a healthy way to help people identify and live out their God-given abilities. I have observed dozens of people experience ‘aha’ moments as strengths-based training has helped them gain clarity on what they excel at. By clarifying their strengths, it often also helps them understand what they shouldn’t focus their time on.

Imagine what could occur if we gain the same level of strengths clarity at the organizational level!

Similar to understanding our personal strengths, organizations which understand their collective strengths will be able to achieve greater levels of success. Can your business list the five strengths that sets you apart and defines your corporate DNA? Doing so means that you have spent time determining what you are good at. In turn, this also means you have decided what you were not going to be good at. Jim Collins defined this as your organizational hedgehog (understanding what drives your economic engine, what you can be best at and what you are passionate about). Knowing what you are good at allows you to say yes to the right opportunities and no to the wrong ones.

Here are three signs that your organization may be suffering from a lack of strengths clarity.

  1. Copycat Strategy: Organizations that consistently peer over the fence of their competitors are often unclear about what they are good at. While it is important to learn from others successes (and failures), successful companies adapt the appropriate lessons to their unique situation. Copycat organizations try to adopt what the competition is doing. Trying to be good at what everyone else is good at will move your business into non-strength areas.
  2. Unfocused Strategy: How quickly respond to the following question: “What problem does your company solve for me?” If you find yourself fishing for an answer, you likely don’t understand your strengths. Alternately, if it takes you 10 minutes to answer the question you likely have unfocused strengths. As Michael Porter said, a company without a strategy is willing to try anything. Unfocused organizations will stray into non-strength opportunities.
  3. Flavor-of-the-month Strategy: Companies that look for the latest fad are slaves to non-strategic change. I often see this tendency with habitual conference attendees who are looking for ‘that one thing’ that will make their business successful.  An old business axiom serves as a good litmus test: “speed, price, quality – pick two.” If you have a difficult time saying no to things which are not your core competencies you may be experiencing flavor-of-the-month symptoms.

Organizational design guru Jay Galbraith summarizes this nicely; “Strategy is the company’s formula for winning”. By definition, a formula is designed to solve a specific problem. No formula solves every problem. By determining your organizational strengths, you end up with a formula for the kind of problems you are designed to solve. It will also help you understand the problems you were not designed for. Most importantly, strengths clarity will provide your customers with a clear answer to what problems you will solve for them.

“Strategy is the art of sacrifice.” Mike Maddock

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