Managing Yourself

The Most Strategic Leaders

Excel in 4 Disciplines
by Rich Horwath

June 18, 2024

Michael Prince/Getty Images

Summary. Strategic fitness is a leader’s ability to learn from and adapt to their
environment to set direction and create a competitive advantage. A study of 77 C-
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 suite executives over four years found that strategically fit leaders excel in four
disciplines : 1) Strategic fitness, or... more

During a safari in Kenya, I watched a pride of lions stalk a herd of

zebra in silence for nearly 90 minutes. At that point, a lion cub
rose up from his crouched position, and the zebra scattered. The
female lions growled at the playful cub and moved on, well aware
that their pride’s survival was wholly dependent on their fitness
— their ability to adapt to their environment and gain advantage
in the form of food.

The experience struck me as a useful metaphor for strategic

fitness, or a leader’s ability to learn from and adapt to their
environment in order to set direction and create competitive
advantage. Just as the pride of lions needed to adjust to the lost
opportunity for a meal, business leaders must adapt to a changing
environment to grow and sustain their business.

Professional athletes typically spend much of their time

practicing, as compared to competing. For business professionals,
this dynamic is reversed, with most executives spending nearly
all of their time working in the business and very little practicing
to become better at the skills foundational to their success.
Leaders who don’t practice their skill development will see
strategic fitness levels that can be equated with the lower physical
fitness levels of animals found in a zoo, as compared to their
counterparts in the wild whose skills are strengthened each day
by hunting for their survival.

So how does a leader develop — and maintain — their strategic

fitness? To answer this question, I studied 77 C-Suite executives
over a period of four years. These leaders were based in the United
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 States from industries including technology, health care,
financial services, consumer packaged goods and nonprofit
associations. Each took an 80-statement strategic fitness survey,
of which the average baseline score was 60 out of 100, indicating
that there was a significant opportunity for improvement. I then
conducted monthly one-on-one conversations and observed these
leaders quarterly at their executive team meetings. Based on my
observations of those who scored higher — and those who
improved over time — I identified four disciplines practiced by
strategically fit leaders.

Strategy fitness: They set clear strategic direction — and

calibrate when necessary.
The ability to develop strategy is integral to an executive’s
success. According to a 10-year study of 1,500 companies by
McKinsey & Co., setting strategic direction is the number one
factor that improves organizational health. And yet research by
Gallup over the past 30 years with more than 10 million managers
found only 22% of employees strongly agreed that the leaders of
their organization have set clear direction for the business.

One behavior that sets strategically fit leaders apart is their ability
to adapt their strategy in the face of a changing environment.
They do this by regularly meeting with their team to gain their
perspectives and include their input to sharpen the direction.
They also continuously scan for and collect insights on their
market, customers, competitors, and company.

Todd, an executive I work with, had grown his technology

company to nearly $100 million in annual revenue when he
realized he had a problem. The sales team was signing up dozens
of new customers each day because they were incentivized on the
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 total number, rather than the revenue and profitability
contributions, of each. The disproportionate number of small
customers was exponentially taxing the service operations area,
and the team was beginning to neglect the needs of their larger,
more profitable customers.

Todd re-evaluated his strategy and made the painful but

necessary tradeoff to sunset all smaller customers below a certain
dollar threshold by year end and fully invest in new products and
enhanced services designed to provide greater value to larger
enterprises.

To evaluate your own strategy fitness, ask yourself the following:

Do I adapt my strategic plan when new insights arise to

create differentiated value for customers?

Have I demonstrated the ability to calibrate my plan when

the business context changes?

How often do I update my strategies and plan with new

insights?

Leadership fitness: They refine their leadership style to

meet the moment.
When I met Lori, a chief revenue officer at a large financial
services firm, her team had failed to meet their financial targets
for two consecutive quarters. She realized that for the first time in
her career that her “just-get-it-done” style wasn’t producing the
desired results, and she had to make a change.
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 Strategically fit leaders understand that their value to the
business is enhanced by continually observing their own
behaviors and interactions to assess how they can improve to
meet the moment. They operate based on a series of leadership
principles that trigger the behaviors necessary to support their
strategic direction — for example, “We operate with an ownership
mindset,” or “We assess the competitive landscape on a regular
basis.” They also identify which of their own behaviors can help
others achieve their goals — for example, “I listen without
judgment,” or “I protect people’s time from fire drills.”

Lori and I identified five leadership principles that she felt would
help her and her team move from a grind-it-out mentality and
that they could adapt based on the needs of the moment.

We lead at our level and don’t do our direct reports’ work.

We agree or disagree but then commit to the chosen course

of action.

We build trust by doing what we say we’re going to do.

We clarify decision rights to eliminate the escalation of

issues.

We give people our full attention when engaged in

meetings.

To better understand your level of leadership fitness, ask yourself

the following:

What are my leadership principles? How do I want to be

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 remembered as a leader?

Do I proactively solicit insights on my leadership

performance from direct reports and colleagues to gauge my
impact?

What triggers have I created to help the team adopt the

leadership principles?

Organization fitness: They invest time thinking about the

future state of the business.
Organization fitness is determined in large part by the ability to
evolve your business model to proactively position your group to
create, deliver, and capture value. A PwC Global Survey of CEOs
found that they would ideally like to move from spending 47% of
their time currently thinking about the future of the business to
57% of their time.

Investing time thinking about the future state of the business

requires discipline, just as it takes grit to get up to exercise each
morning before the day gets busy. One survey of leaders in the
construction industry found 63% did not have a plan with a time
horizon greater than one year and half of leaders didn’t have a
plan for the year.

While plans will change throughout the year, it’s the process of
continually scanning one’s environment to identify new patterns,
trends, and activities that may have a material impact on the
business that’s truly important. Training the organizational
muscle to generate and share these insights breaks down silos and
creates a learning flywheel that can lead to competitive
advantage.
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 I worked with Cheryl as she was taking over as president and CEO
of a health technology company from her highly successful
predecessor. She recognized the adage, “What got you here, won’t
get you there,” was staring her in the face. While her predecessor
did indeed shepherd a strong financial performance, it was short-
term oriented and marked by a lack of investment in critical
future infrastructure areas, such as data management.

Cheryl worked on identifying the core elements of her company’s

current business model — the “as is” state — and then went about
designing options for the future by comparing today’s norms with
future deviations from the norm. Cheryl excelled in harnessing
her team’s thinking on new ways to capture value, partnering
with key customers on the design of several new SaaS 2.0
(software as a service) offerings and licensing several IP products
that were previously unavailable to customers.

To assess your organization fitness, ask yourself the following:

Have I clearly depicted the business model for our group?

Do I understand what the internal challenges are to

successfully evolving the business model?

Where can we deviate from the industry norm to create,

deliver, and capture greater value?

Communication fitness: They effectively collaborate with

internal and external stakeholders.
A survey I conducted in conjunction with Human Capital Media
Research of 400 talent management leaders found that 58% of
cross-functional groups within organizations do not effectively
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 align their strategies with one another.

As one’s responsibilities increase and the pressure to achieve

goals and reach financial targets heightens, it’s common to lose
sight of the power of collaboration. It’s similar to the star player
on a basketball team believing that she has to score on her own
every time instead of distributing the ball to others who are open
and can contribute in their own ways.

Strategically fit leaders build relationships with colleagues who

can provide expertise and capabilities that they may not possess.
When necessary, they look for external resources who can fill gaps
and then collaborate with them effectively.

When I met Steve, he was recently promoted from vice president

of product marketing to chief marketing officer at a mid-sized
manufacturing firm. He was well aware of the challenges involved
in attempting to span the silos between the sales and marketing
functions. Over the years he had watched sales reps and their
managers agree to customizing even the smallest orders from
unprofitable customers, while the marketing team would promote
a premium price, and the contracting group would appear to take
an inordinate amount of time to execute agreements.

Steve moved quickly to develop regular interactions with the key

players from each area. His efforts reduced the number of issues
escalated to the executive team and freed up more time for
coordinating strategic partnerships with key customers.

To evaluate your communication fitness, ask yourself the

following:
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 Am I meeting with key internal stakeholders intentionally
and on a consistent cadence to develop relationships and
align strategies?

Do I have a clear understanding of what my colleagues are

trying to achieve and their strategies for doing so?

What channels are we using to share insights across

different functional areas?

...

By taking a proactive approach to enhancing the four disciplines

of strategic fitness — strategy, leadership, organization, and
communication — you’ll continuously mine new insights from
your interactions leading to greater competence and confidence
in setting strategic direction for your business. According to
research by Harvard Business School’s Michael Porter and Nitin
Nohria, the average CEO invests 45 minutes a day developing
their physical fitness. How much time are you investing each day
in your strategic fitness? It may be the difference between
thriving, or not surviving, in the business wilds.

Rich Horwath is the founder and CEO of the

Strategic Thinking Institute where he serves
leadership teams as a strategy workshop
facilitator, executive coach, and strategic
advisor. He is a New York Times and Wall Street
Journal bestselling author of eight strategic
thinking books, including Strategic: The Skill to
Set Direction, Create Advantage, and Achieve
Executive Excellence.
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