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The Hare and the Tortoise: The race is not to speedy(XXVII). Setting the correct pace in corporate strategy.

… But the Hare slept on very peacefully…”

The hare and the tortoise, a fable by Aesop
The hare was sleeping.

Have a beautiful weekend. In our last post, we have been contemplating three pacesetter styles when it comes to our corporate strategy pace of racing. I also introduced to you the meaning of a pacesetter and its clever examples such as a metronome (the old mechanical model and the new digital ones that are sold to us in the new digital boxes, an application into your Smartphone and/or a running pace watch). But there is also a perfect example of a pacesetter that I did not mentioned to you and this is the heart pacemaker. A pacemaker is a small, battery-operated device. This device senses when your heart is beating irregularly or too slowly. It is also used for abnormal heart rhythms (arrhythmias) that can cause your heart to miss the beats. A pacemaker is the key difference between living or dying for those who depend on it.

Corporate strategy is here to syncronize our business metronomes. So, every time that you listen or read or hear the two words “corporate strategy”, we must remind ourselves that the role for corporate strategists is beyond the decision making about growth, portfolio analysis or corporate parenting. Above all that, our role is to become syncronizators of pacesetters, or as explained in the video below, to become a beam over the two cans (or the surface) that connects different metronomes (in the case of several SBUs or business units). We (the corporate strategists) can help to synchronize all the pacesetters in between them. It is our role to bring organization and order into the chaotic disorder, particularly in the context in which disruptive metronomes (which are now digital or are located in an app in your smartphone or in a wearable watch) are completely disconnected from the rest of mechanical classic old metronomes.  Our role as corporate strategists is to help synchronize all together, magically.

Corporate Strategy as a tool for synchronization of metronomes. Eleonora Escalante Strategy, as a former graduate and an alumnus from Cornell University is pleased to share that there is also one professor teaching in Ithaca, New York, that imparts mathematics at the Cornell College of Arts and Sciences. He uses math to explain the synchronization in nature. His name is Steven Strogatz. Professor Strogatz explains “One of the things I love about math the most is its really uncanny ability to reveal hidden patterns in our everyday lives, in nature, in the world around us.” Strogatz observations about spontaneous synchronization are based in his field of mathematics, particularly in the legacy of the pendulum, that was created by a Dutch physicist Christiaan Huygens in 1656.  The second law of thermodynamics expresses that everything in the universe tends towards a messy disorder, particularly in complex systems where the chaos is the norm. Strogatz states that there is something that helps to put things in order. There is something that allows to synchronize? What is that?

How does the metronome play its role? We already mentioned 4 elements of a metronome or a pacesetter: a speed unit (which in the case of a metronome is measured in BPM or beats per minute), a range of right speed (upper limit and lower limit), attractive and previously accepted standards in terms of pulses and finally keeping the right tempo. The mechanical old metronome was created with a purpose. The purpose of the metronome is to help keep track of time and beats of the music that the user is performing. It is the ultimate aid for any aspiring or experienced musician to use. Particularly when singing, or playing different instruments in a band, even when dancing, or when playing in an orchestra. We also saw on our last post, the usage of metronomes for keeping the pace and the cadence in running, walking, swimming, biking, etc.

An entity without a metronome is a disaster.  It is impossible for any band or a group of musicians playing together to excel without a metronome. It is the ultimate aid for any aspiring or experienced musician to use. Metronomes measure their pace in beats per minute (BPM), and most units can play beats from 35 to 250 BPM. When the metronome is mechanical, we set the beat by sliding a marker scale down the pendulum, or by turning a dial to your desired tempo. The way you set the beat will depend on the type of metronome you have, while the tempo will depend on the style of song you want to play. Most contemporary pop songs range between 60-90 BPM, while rock songs can go from 110-120 BPM. Dance and EMD tracks soar from 160 BPM+. In the case of sports, most runners train between 100 BPM and 160 BPM, on average.

Each entity, either a private company, or an NGO, or a political institution or a government division has its own metronome. When the business only has one line of products and services under one single business, corporate strategy provides the choice of the better metronome for each organization to compete in their own industry. When the organization has multiple businesses (SBUs), Corporate strategy offers the synchronization beam in which all the SBUs metronomes from each quadrant or zone are placed, so they can spontaneously can play all together at the same syncronization of beats per minute (BPM) and tempo, all harmonized.  

Let me explain in the following illustrative video below:

For this group of singers, the metronome helps them to be “on point”, keeping their syncronized harmony, and their entrances/tempo correctly. Now let´s imagine that each of this singers of the choir is an SBU (Strategic Business Unit). One singer (the one at your left is located in the Alien territory, the second one in the Heartland region, one in the ballast and the last one at your right is located in the value trap territory (See the corporate parenting map below to refresh this concept).

Corporate Strategy: The Quest for Parenting Advantage. By A. Campbell, M. Goold and Marcus Alexander.

Ambivalence: classical metronome vs digital metronome?.  Until the year 2008 (before the Smartphone), all these entities (each SBU in every company) were used to play using the mechanical metronome, as the one you observe in the video above.

But suddenly, around 15 years ago, the digital metronomes entered the scene, creating a complex chaos. And nowadays, this chaos also happens because the newest generations do not like to use the mechanical metronome (they consider it out of date, unfashionable), and they are emigrating to use the apps or the metronome wearables. Consequently, we have half of the world (generation X and baby boomers) using the classical metronomes, and the newest emerging talent (millennials and the gen Z) pushing us to use the digital metronomes.  

What to do when we have different metronomes, and the pacesetter tool is changed disruptively? The usage of a digital metronome or a mechanical metronome to play music is the same. When your pace is related to static activities, you can use the first one or the second one, because you are not moving. But in the case of sports (as triathlon or running or biking), which are dynamic activities, the mechanical metronome doesn´t work, but the wearable digital one (watch) or the app in your Smartphone.  Now let´s see this, from the point of view of business. Before globalization took place, the corporate strategy that kept the SBUs together synchronized was simple, and businesses were orchestrated under the classical mechanical metronome. With the expansion of China´s products and internationalization of multiple companies all over the world, which happened at the same time than the adoption of the combo of NAIQIs; the classical metronome, that we used to keep the pace has been forced to switch to a digital one. Without any type of regulation in place. And the problem is not to switch from the mechanical old ways to the digital new ways. The issue here, is that the BPM has increased to almost 250 BPM (the maximum, or near there). The pacesetter is working at the top velocity for the techies, and the irrational acceptance of this speed by consumers, is pushing out our peace and joy. It is trying to set it in the high swiftness. And without any discernment our brains don´t find any happiness there either.

The cadence in the middle of racing. Eleonora Escalante Strategy also wants to put the concept of cadence on our today´s table. “The cadence – also known as stride rate – is the number of steps a runner takes per minute (SPM)”.  It’s the most common metric used to measure running form. The cadence remains important for finding the optimal SPM for each of us”. The optimal cadence depends on several factors, including each person´s height, weight, and running ability. Cadence also varies based on the type of run you’re doing. A training or long run cadence will be slower than a speedwork or racing cadence, so you should determine your base cadence for your different types of paces (easy, normal, tempo, marathon, etc.). Additionally, each runner or walker cadence affects that person ground contact time. “Ground contact time” refers to how long the foot is in contact with the floor in each stride. The longer you’re in contact with the ground during each stride, the longer you are engaging and in turn placing pressure on joints and muscles. Less contact time equals less pressure. To understand the meaning of cadence, simply take a walk today: take large over reaching steps and you will feel the effort that you’re placing on all your joints and muscles. Then try the same but take little, faster steps. You’ll notice that the fast steps may increase the effort on your cardio vascular system (heart rate, breathing), but your legs won’t feel the same level of effort than when taking big steps. The speed (distance/time) is the same in both scenarios, but in the first one you can be injured. Meanwhile in the second one (with little steps), that level of cadence won´t hurt you. A higher cadence has been thought to reduce injury risk.

Setting the right pace to race. Now, if the speed in dynamic activities (businesses and economic endeavors) is high (measured in distance/time), and the cadence is low (big steps measured in steps per minute), then we have a double injury factor that multiplies its consequences into deadly disaster or a catastrophe. This double risk factor transforms the level of efforts and the consequences of being injured into a calamity, or into a point of no return. Under this situation we land into the pacesetter style that is “speedy but dangerous”. The degree of injury is greatly horrifying, if things go wrong.

If the speed is “slowly but steady”, no matter the cadence (high or low), at least there is an opportunity to avoid damage, because the beat is slow, and we are able to turn around when we see danger, and avoid mistakes.

Time in the context of setting the right pace is crucial. The only way in which we can manage speed and cadence is through a unit of time. In static circumstances, it doesn´t matter the type of metronome used. But in dynamic global settings, it is a big issue to do corporate strategy when the metronome has been switched, and you find businesses using the mechanical one, meanwhile other emerging businesses are using the digital metronomes. How to syncronize them all together? Corporate strategists can´t synchronize them, because we have two different tools of synchronization. And the chaos is omnipresent under that setup.  For example, that is why you have a profound anarchy between those who wish to run at higher speed and high cadence, to install the “speedy but dangerous” pacesetter style, in comparison with countries where the pacesetter style is “slowly but steady” (slow speed, regardless the cadence): For example, Dubai vs. El Salvador.
In this context, the corporate strategy synchronization does not happen automatically, it will require decades, not just to learn how to synchronize with both types of metronomes (digital and mechanical), but also to teach those who never used a metronome, that they need to use it, and learn to play by the same rules of respect, regulation and law, time, speed, attractive same standards, and tempo.

Rhythm pacesetters: in the business world, the regulators, the governments and NGOs. Corporate strategists are needed to help to reconcile and combine or integrate the technology tools into a middle ground. It is not possible to choose for the “speedy and dangerous” pacesetter style, because it is simply hazardous and unsafe. So instead of starting to impose from the FINISH line to go to high speed, we need to start our race from the START line with the “slow and steady”. Nothing to force please. Otherwise the race is worthless and empty. Nothing good out of a race with different metronomes, speeds and cadences will come up.

I will stop here. Our next publication will be “Connecting the dots between Aesop fable, time and corporate strategy”.  Remember we will end this saga in a week from now, next Friday, 23rd of July 2021. Then we will splash into our 2 weeks’ vacation, just to return back on August 10th for the inauguration of the third saga of 2021: “Portfolio Analysis: Igniting long term spirit into a short-term world”.

Have a lovely weekend. Blessings for reading to me.

Bibliography utilized today:

Disclaimer: Illustrations in Watercolor are painted by Eleonora Escalante. Other types of illustrations or videos (which are not mine) are used for educational purposes ONLY. Nevertheless, the majority of the pictures, images, or videos shown on this blog are not mine. I do not own any of the lovely photos or images posted unless otherwise stated.

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