hey everyone welcome to another episode of great leadership my guest today a repeat guest last time he was on the show probably over three years ago when we were talking about his uh then exploding bestselling book which is still exploding and bestselling uh it is Michael Watkins professor of leadership and organizational change at the IMD business school as I mentioned he's the bestselling author of a couple books um you might know him from his book The First 90 days which has over 10,000 reviews on Amazon I wish my book had 10,000 reviews on Amazon and he also has a brand new book out called the six disciplines of strategic thinking leading your organization into the future and if that wasn't enough he was also recently inducted into the thinkers 50 Hall of Fame so today uh just to give you guys a little bit of a run rundown around what we're going to be talking about um it's really going to be focused on these six disciplines of strategic thinking um so we're going to go through what those six disciplines actually are from Michael's new book and then towards the very end in the leaders toolkit section we're going to talk about specifically how to develop your strategic thinking ability so with that introduction and summary Michael welcome to the show it's great to be here Jacob thank you you know you didn't even need to write a new book because your other book is still doing so well you probably could have just stayed with that theme and topic for the next 5 10 15 20 years and been good uh but somehow you found the time to write a new book um why this one and what kind of led to the um the creation of it yeah well first of all really delighted to be back with you um you know I the first 90 days is was written you know more than 20 years ago so you've still got lots of time to accumulate those reviews right before you should you should worry about it and it's updated a few times I believe right so updated once in 2012 13 and I'm updating it again now because of course so much has changed right um in the the world of work and how leaders you know function and take charge in new leadership roles and we can talk about that a bit if you if you want later um so so the in the origins of this really lie in the my own sort of personal Consulting and coaching practice right so you know I work primarily with leaders taking new roles I love working with leaders taking new roles it's endlessly fascinating to do that because there's always something new and different going on I always learn something right and it's one way I stay in touch with what's happening and continue to write about things that I sort of see emerging or notice that I haven't uh noticed before but one of these things was strategic thinking and you know you work with different leaders and they're all good leaders right they've they've gone to senior senior roles they've been successful but you see that you know there's really a substantial difference in in their ability to think strategically right some are really profoundly good operators and they're okay when it comes to strategic thinking others they're just you know crazy crazy good like so gifted you know in their ability to foresee sense respond you know uh that it just kind of is is fascinating and that of course leads to questions like you know is that just part of your you know your brain and the way you your genetics and your upbringing or is there something we can do about about it the other thing is just the turbulence of the times and how critically important it is to be able to engage in strategic thinking and I noticed that you actually went through what looked like a really interesting program on foresight uh a few years back right you know so as thinking in terms of the future and I actually noticed there's quite a few elements that are similar right yeah but that ability to think about what's coming and focus on what's important and char a pathway into the future I'm not sure we've ever seen a Time certainly in my lifetime when that's been more important than it is right now right just given the enormous turbulence uh that we're seeing yeah out there so was it was a combination of those things yeah know I couldn't agree more um yeah that was at the University of Houston it's funny because a lot of people put the word futurist in their LinkedIn titles and in their job descriptions but few people realize that it's actually a discipline that you can get a degree in and a master's degree in I didn't go as far as getting a master's degree but got my professional certification in foresight and yeah it's a very specific way of thinking and I remember when I took that certification I was familiar with some of the concepts but as they kind of teach you uh for example something like the cone of possibilities or kind of these causal ways to think about stuff and and how to break things down in various Frameworks you think about that and you're like wow like I never I never thought about it like this and it's just it's just a new way of thinking about the future and solving problems and identifying opportunities um which I think is super helpful it's very to me analogous to chess uh and people who listen to this program know that I use chess a lot because I I play competitive chess I spend a lot of time with chess and I think the best way that I could explain and you correct me if I'm wrong what strategic thinking is is if you ever see an amateur player play chess they usually think in terms of just one move right I'm going to move my pawn my opponent might move their bishop and that's kind of like and then I'll figure it out from there and strategic thinking the best way that I can think about it is thinking in terms of various scenarios and possibilities um not predicting the future but trying to make sure you're not surprised by what your opponent might do this is why so many competitive chess games can last five six seven eight nine hours is because a lot of your time is thinking about all these variations and how you might respond and what your opponent might do would you say that's a pretty fair analogy in terms of strategic thinking and being good at at chess so I think it's a pretty excellent representation of some elements of strategic thinking um you know and I think that notion of the mental agility the kind of Chess Master skill to sort of foresee Action Reaction move counter move um is absolutely a Hallmark of great strategic thinkers right that ability to look out a few pies if you moves or whatever it is and kind of Imagine where you're going to go I'd probably connect it to a bit to VIs right I mean I know visioning was one of the the disciplines you looked at when you were doing the work on on futurism but imagining how the game will evolve and and imagining an end state of an attack right and how you're going to kind of launch that attack and what's going to happen and then working backwards from that to what are the moves the next three four moves I need to make to kind of set that up right so I think that's very analogist to strategic thinking so how I think there's also an element of Chess that that is really really deeply Central to strategic thinking though that we haven't talked about yet which is pattern recognition right the the ability you know you're you're a you know uh you play competitively you play seriously you know through that time of becoming uh the player you are you played a lot of games you saw a lot of patterns and eventually I suspect like many you know strong chess players you can look at a board and you sort of see patterns right and you see possibility yeah that a novice you know is just seeing pieces on the board they're not understanding the relationship they're not seeing the possibility yep and so I think when you look at and by the way we just hit three elements of my thinking about strategic thinking right one is pattern recognition the second is that mental agility that chess master skill and the third is visioning right and you know working forward you know sorry looking forward reasoning backward to what you do I think there's a few other elements that I include in strategic thinking that I think chess is not as great a uh a model for although I'd have to think about it right so systems analysis right thinking of things in terms of systems you sort of mentioned it a bit earlier when we were chatting before the program about causality and causal links and action and reaction and feedback loops and building those mental models of the way complex domains seem to work right and knowing that if this happens over here then that's going to have you know have something over half there and that's going to set up a feedback loop down there and you know someone's going to buy a hot dog and pipsy you know New York right um there's a there's a systems view of things and I I was trained as originally as an electrical engineer so that kind of systems thinking was kind of beaten into me through my undergrad actually my PhD was in decision Theory Game Theory negotiation right so that's some of that that game thinking is kind of Pretty Natural and I think shows up in the book did you know that 96% of the people who watch videos on this channel are not subscribed that's pretty crazy right make sure that you hit subscribe to the YouTube channel so you can get notified when more videos just like this one are released I think there's so kind of and you tell me if if I'm correct in this but as far as chess goes I know there are certainly a lot of games for example where often times you know there's kind of the opening phase and the middle phase and endgame phase and often times in the opening a lot of the chess players are as they say going by the book meaning the first few moves have been analyzed to death by a computer and so if you ever watch a chess game you'll notice that grand Masters in the first oftentimes 10 moves are just playing instantly and then they get to you know maybe move 15 or 16 where everyone kind of stops and now they're thinking on their own but I know there have been lots of situations and I watch a lot of chess games which I know is probably boring for a lot of people but I've watched a lot of chess games where often times a chess player will make a move on the board and everybody gets very confused by it and nobody understands why that move was made and it's only maybe 10 moves later or 15 moves later that that move makes sense and to me that's I guess the best analogy I can think of for this idea of system thing systems thinking is something that you do early on might have an impact much later down um the course of the game maybe an hour later or two hours later where it's like oh if I didn't move that pond I wouldn't have been able to do this so being able to yeah not predict and foresee but to understand the position and to understand what's going on in the board to give yourself that opportunity later on down the road if you need it so I don't know if that no I think exactly anal but no I mean what you're also getting into is optionality and creating options for yourself and you know maintaining strategic flexibility versus committing there's a really interesting I think Dimension to what you're saying too about you know the value of having a solid strategic Playbook versus the the ability to improvise right yeah exactly what you said is too right there are you know many many openings in chess and they have been analyzed to death and you know you start as a beginner learning the Queen's Gambit declined I'm making this up right um and and you start to First ever on this show by the way to mention a chess opening so you've already Skyrocket in like cool awesome points in my book well I I play chess online with my with my sons right and I started doing it quite later in in life and I wouldn't ever claimed to be particularly gifted but I think it's great training for the mind right I think it's wonderful training for the mind and it's one thing I recommend in the book actually that people do if they want to get better at that dimension of strategic thinking right which is that ability to think forward a few moves and reason backward right but what's I think you know there's many things about which I think are fascinating right but you know those book moves there's kind of an analogy to the sort of strategy Playbook that companies have which is kind of a standard set of actions and reactions and responses and so on but then what happens when a new competitor innovates in some sense and kind of the book gets a little thrown out of the window right and it could be a move that on the surface looks like stupid right but it disrupts you know the flow of things in a way that throws the other player off balance and they may pull it off right you know that moving that pawn when it looks like it's you know tmote to Suicide could be could end up paying off for you right or not right and that's and that's pretty pretty interesting right yeah for sure U okay so before we go through these six disciplines how would you explain what strategic thinking is because earlier on you alluded to something which I thought was interesting is that a lot of leaders get to leadership roles maybe even to CEO positions because they're good operators but they're not necessarily good strategic thinkers um so what is the difference between just being a good I don't know a good business thinker a good operator because even to be a good operator you still need to be able to you know think concretely you still need to be able to uh be perhaps creative in terms of problem solving you need to be Innovative maybe in some areas but somehow you could still lack the Strategic thinking piece so what is strategic thinking and how do a lot of these leaders and Executives get into their roles without even having it yeah so so I guess first thing I want to say is I'm not at all coming down on people who are tremendously gifted operationally right I mean execution let's face it is hard yes and executing consistently is hard so let's not kind of say oh you know geez they're just plain old operators right that's not the case what's really rare in my experience is folks that are both really good on the execution side and really strong on the Strategic side and they're kind of the unicorns right of which I know a few that have that capability to move between the levels of analysis between the high level you know I I one CEO I work with I mentioned in the book um he described himself after we had a conversation about this and he wasn't bragging as a cloud de thinker right the ability to kind of move up to that high level drop down to that low operational level be intentional about what where what your altitude is right not fly at the wrong altitude that's that's sort of you know to me the the essence of it I mean I also know people really great people who are tremendously good Visionaries you know creative but you need to pair them with somebody who's really strong in execution you need to give them a really good EA you know you need to provide a chief of staff that's going to make sure everything works and again there's nothing wrong with that right y I mean some some great companies are run by complimentary people who have you know the skills on the more Visionary side and the skills more on the execution side and that's okay yeah but really back to your question right so you know once I got interested in this starting to do interviews starting to talk to people example would be you know leadership development experts right people in large companies that are developing next Generations of leaders okay what strategic thinking uh uh you know I I know it when I see it yeah and so I that got me pretty interested right because I wasn't getting very coherent responses to you know to the question it's not the case by the way that people haven't talked about strategic thinking in the past you know of course people have but there's a lot less that's been written about it than there has about strategy right there is you know I mean it's like you know if the pile is this high for books on strategy then the pile is this high for books on strategic thinking y they're not the same thing at all right the output of strategic thinking may be a strategy but a strategic framework you know whether it's you know uh blue ocean you know or Porters five forces that's not strategic thinking that's analysis right and that's a different that's a different order of things so the way the way I started to Anchor it grer so there just hearing you talk reminds me of um who was it I think it was Tim Brown uh I had him on the show many years ago he used to be the CEO of idio and um he told me about this I guess you could call it a just a short film that's on YouTube anybody could find it if you Google the powers of 10 and he gave me that exact analogy I don't think he used the word strategic thinking but he used this idea of being able to zoom in and zoom out and the whole concept of this very short film is and I think it was created in the 70s or the 80s but basic basically shows for example uh a couple sitting on a picnic uh in a on a grassy field and then it zooms out and all of a sudden you see them on the picnic and they're in the park then it zooms out again and you see the city then it zooms out again and you see the world then it zooms out 10 times and then same thing it zooms in 10 times up until the point where it goes into like the atoms and molecules that are inside your hand and inside your body and Tim was telling me yeah told me that's a very crucial skill for leaders is you have to be able to zoom out to see really the big picture but you also have to be able to zoom in to understand how things are working and so hearing you talk about the the ground to cloud or Cloud to ground really made me think of that idea of the powers of 10 and again anybody anybody can find this on YouTube it's just kind of a cool video very no no and I and I will I will find it because it sounds fascinating right but it's exactly the the concept right and it's it's the aperture it's the magnification level I'd also say though that what's critical is your ability to be intentional about you know are you looking at a power of one are you looking at a power of five or you looking at a power of 10 because you know you get you can see people get caught in the weeds with things and not able to pop themselves up and see the big picture you can you see people who are up in the big picture and they really can't get down into the detail so so there's something about your ability to shift between those levels in almost exactly the way you're describing right yeah by the way Ideo amazing company you know uh extraordinary contributions I think in areas like you know creativity design thinking I mean it's one CEO and I'm curious to hear you think who you think would be good leaders that are good strategic thinkers one would be at least for me not recently but the first time he was the CEO of the company would be a bob Iger um but a bob sure but a bob Iger uh you know 1.0 I think after he took over Disney now there have been a lot of challenges and problems with the company but I've been reading his book the right of a lifetime and it's just fascinating how he was able to make deals with people like Steve Jobs how he was also able to get onto the ground level and and you know go into the parks and get into the nitty-gritty of the decisionmaking and and he was constantly able to both zoom in and zoom out so to me he seems like a good person as far as strategic thinking and really transformed Disney and again obviously now I don't think he's doing a very good job but the first iteration of Bob Iger I thought was spoton with some of the stuff that you're talking about any CEOs out there either past or present who you think are good exemplars of what it means to be a strategic thinker so you know his star is dimmed a little in in the time since um he was at G but Jack Welsh was renowned for being I love right yeah so he was renowned to being super good at this right and he almost had a kind of again A playbook right he' they'd go around and do these business unit operational reviews and he'd come in and the team would present to him and he'd pick something and just dig dig dig dig down down down and you know testing to whether the team really you know understood right at a deep level what was going on and then once he was sort of convinced that they were he'd pop back up they'd have a high level strategic conversation yeah so that that example always kind of inspired me in thinking about this um yeah and I like that you mentioned um Jack wsh for a few reasons because one so I had a few people on the show well one in particular David GIS who wrote a book called The Man Who broke capitalism how Jack Walsh gutted the Heartland and crushed the soul of corporate America and how to undo his legacy um and then you have yeah very brutal scathing title of um and then you see people like Simon cic who've been very Republic and calling Jack Welsh a bastard and I always find this interesting because now I'm not saying Jack Welsh is the perfect CEO by any means but a lot of people when I asked them if you could explain and Define to me what it means to be a great leader how would you explain it and a lot of times they say it's a leader who helps create other leaders and under Jack Welsh I think he created something like 32 or 35 other CEOs who worked for Jack Welsh then went on to become CEOs of other companies and Jack gets a very bad rap I mean of course he earned the nickname Neutron Jack right he um was famous for the uh when he was saving GE let's be frank right yeah yeah yeah but he also created a lot of these Concepts which became very controversial like Mass layoffs like Rank and yank you know doing all sorts of things in in in G which people frowned upon but at the same time a lot of people I know who worked for Jack Welsh who've been on this show have said that they've learned tremendous lessons from him I had for example example John Chambers who didn't work directly for Jack Welsh but Jack Welsh said he mentored him I had Frank Blake the former CEO of the Home Depot and several other CEOs who said that Jack was was a very tough boss but he was necessary in shaping who these people then became so it's interesting that you mention Jack wash right because some people that's interesting yeah some people hate him and some people love him so I'm curious to get perspective on Jack Walsh and then we can dive into what these six disciplines are he's a very controversial CEO I don't think Jack Walsh would care honestly what people thought right I think he was pretty consistently doing what he felt he needed to do to make GE successful first to survive during the turnaround phase 84 right and yeah he took some very hard decisions in 84 but the company wouldn't have survived if he hadn't done that right yeah and it was the number one and two in the industry it was devest sure it was closing and slashing and burning and yeah Neutron Jack was there but once that was done he was a builder in every sense of the word right I used to teach a case Jacob actually it's funny that you mentioned this called the the GE Talent machine so when I was doing stuff about leadership development I would teach a case about ge's Talent Development system and how they assess people and how they move them through the businesses and develop them until they have this incredibly uh strong bench of leaders right and many leaders and not just at the level you're talking about have left GE and been very successful in other places right it was very much a a source of talent for for many organizations you know that said you know G had a very particular culture you know it was a very plain spoken very hard-edged culture that I think reflected W in many ways right and so when leaders left GE to go someplace else they often struggled the first in the first organiz ization they went to right because you know my joke was basically they needed someone to kind of sand the corners off them a little bit you know so they would they would kind of play a little nicer than than they did um but you know that's that's a pretty powerful Legacy to have right and I think um you know and also you know I think there is probably some Envy too of what he accomplished right um yeah so I mean that's just just guess a couple things about it right do you think that those types of leaders need the edges sanded and so the reason why I ask is because today at least my impression is that we are struggling to find strong capable leaders and what I mean by that is I mean leaders who are willing to take a stance leaders who are willing to be tough leaders who are willing to push their people leaders who are willing to challenge the status quo leaders who are not constantly just worried about how are you feeling is everything okay and I'm not saying that some of that isn't necessary to have but if you look at for example how GE was created how Sam Walton created Walmart I mean you look at any for example company that found Steve Jobs and app yeah exactly I mean they worked hard they pushed people they didn't take you know BS from anybody like they worked hard and they didn't they didn't have time for a lot of this stuff it just wasn't and you wanted to work for that kind of a leader right I mean Elon Musk for example gets a bad app but I know tons of people who would love to work for an Elon Musk you know there's no there's no um miscommunication if you work for an Elon Musk you will work hard you will learn a lot you'll get paid well but you will work increasingly hard and to me it just seems like in today's business World we've lost some sense of that work ethic of being okay with working hard being okay with pushing yourself being okay with doing what is necessary um wanting to make those sacrifices if needed I mean today you can't even get employees to show up into the office which is you know just mindboggling to me um what do you think about do you think that's generational do you think that's generational Jacob I think it's probably a mix of things um so on a generational side I can tell you one of the things that really freaks me out is there are a lot of these social media trends specifically on Tik Tok with things like the Sunday scaries I don't know if you've heard of that but this whole concept of the Sunday scaries is that you are so scared into you're so scared to show up to work on Monday that on Sunday you get like anxiety Sunday scaries right it's like we're watching a cartoon um we have something called Lazy Girl jobs which has been trending on social media and there's literally people who go on social media who tell you how to find a job where you can do as least amount of work as possible while still getting paid and they tell you what are the questions that you should be asking during the job interview so that you can make sure you don't have to work hard there's Trends on social media and I don't know what the term is but it's something like you're supposed to ease into the work week where Monday and Tuesday you kind of take it easy you don't work that hard Wednesday you put in a good amount of effort and then Thursday and Friday you have to ease out into the weekend and I see some some of that kind of stuff and I'm thinking like what the hell's going on in the world like if you were to I can tell you part of what's going on in the world that that accounts for it right and and it scares me frankly a lot as it sounds like it worries you right um you know look the Generations after my generation lived in a world where there was plenty they were comfortable they were almost uniformly told they were wonderful know that the sun rose and fall fell you know behind them they were encouraged to think very highly of themselves right um and you know then you see these kinds of behaviors right in some I don't think they you know I certainly know people in those Generations that work super hard of course um yeah so we don't want to generalize too broadly right that's the negative part the positive part is a lot of those same Generations care a lot more about purpose and Mission in their work than they did right you know people in my generation they were just happy to have a really good job right and in my father's generation you know post second world war they were just happy to have peace you know and a good job right so there's been an evolution I think in the direction of feeling like you need more purpose feeling like you need more you know X Y and Z feeling like you're entitled to advancement very rapidly feeling like you know you should be served almost right um and that's a product of an environment of Plenty right we're not living in an environment of Plenty anymore yeah and I believe we're going to live in an increasingly challenging environment potentially very challenging environment and I don't know what's going to happen happen to these folks when you know they transition from you know scary Sundays and and uh you know finding the C themselves GNA happen that's my Worry My worry is that yeah yeah and I think I think we need to get back to some of that old school work ethic and I mean to your point of purpose and meaning and impact I'm a big believer in that stuff too but why is the Assumption on behalf of employees that it's really just up to the organization and up to the leader to create all of that for for you I feel like in a lot of businesses today employees are showing up they're pointing out all the problems in the company and they're saying Hey where's my purpose where's my impact where's my meaning as if it's supposed to be handed to you but it's no more the responsibility of the leader to create your purpose and meaning than it is your responsibility to help identify what your purpose and meaning is and if you just show up to a company pointing out problems and expecting things to be done for you not willing to occasionally make that sacrifice to do what you need to do to work hard to show up with your best ideas then yeah you know like purpose isn't something that's handed to you you have to help create it as well and a part of it is not just what happens at work but it's also what you do outside of work right do you have Community do you have social involvement do you have friends who challenge you and push you and I think all of those are necessary elements that have to come together to help create that purpose and meaning and it's it's hard can I push back on you a little bit Jacob you know I agree in part with what you're saying but I also I think take issue a bit with other elements of it you know back to Victor Victor Franco right you know Holocaust Survivor yeah writer of man's quest for meaning right I think we do have some inherent desire to have what we do means something yes right you know unless you're kind of just like okay it's here's life you know we're going to get through it and we die it's just the great conveyor belt you know um as I had a colleague once describe it to me uh and you fall off the end there is I think a desire among not all but many people to have a sense that this all means something right yeah I have that desire as well but yeah and you do it right I mean you're touching a ton of people out there with your ideas and and the people you bring and so you know you're creating meaning in in what you do right you know and and but it also intersects with the Land of Plenty kind of discussion we were having right which is you know you can't expect to have like big meaning in everything that you do for everybody it's not you know you're not going to save the world I'm not going to save the world yeah together we might do some stuff right so so I I don't I wouldn't sort of set aside purpose and meaning completely um I also would say you know the work the labor market is changing a great deal right and so when there was shortages in the labor market employers had to woo right the younger workers with the promise of purpose yeah that again I think we'll switch off in a microsc you know if if the tables turn in terms of the labor market and and that's unfortunate but I think it's probably the reality of what's going on out there I mean you know I'm very interested and engaged with AI these days and I'm you know more on the pessimistic side I guess than the optimistic side and you know I think it's going to we're and and by the way not because I think AI is going to like destroy the world or you know uh eliminate mankind I think it's going to change the foundations of economies in ways that are going to make it much harder to thrive in the future the topic of vulnerability is front and center inside of a lot of organizations today but should you actually be vulnerable at work in my brand new book leading with vulnerability I actually say that you should not be vulnerable at work but instead you should lead with vulnerability the difference vulnerability is about exposing a gap whereas leading with vulnerability is about exposing a gap that you have and then demonstrating what you are trying to do to close that Gap to figure out how to make all of this happen I interviewed over 100 CEOs and surveyed 14,000 employees around the world and I put all of that into my brand new book which just came out you can learn more by heading over to lead with vulnerability. comom again that is lead withth vulnerability. purpose um and meaning I I agree is totally important and I think there are things that organizations that leaders can do as far as telling stories to employees helping them understand how the work that they're doing is touching the the customer or the company or the business but there are also things that employees need to do themselves and so I think it's kind of a two-part right I mean there are things that leaders can do there are things that employees can do but to me it seems like a lot of the Reliance is on behalf of the leaders and organizations and employees are not wanting to take much accountability to say that yeah some of it does rely on me right some of it does relying me to show up to work with an open mind with a sense of curiosity with the willingness to work hard with the willingness to challenge myself and and and get out of my comfort zone and leaders in turn need to show up and say you know what we're going to help you understand how the work that you're doing is touching customers or employees we're going to help you connect with those customers yourself so you can hear those stories we're going to teach you that if you're in sales and you bring extra money into the business where that money is going and how it's impacting something so there are kind of both parts that can come together to help create that but a lot of employees need to understand that they have some accountability in their own purpose and meaning and their experience at work as well and I I just think that that is a message that needs to be communicated more often um inside of organizations and it almost I think it's also highly dependent Jacob on on the kind of organization you're working for too right so yes yes you know I I one of the CEOs I work with you know leads a large Healthcare organization in the US right and it's much easier to connect people to a sense of purpose when you're actually serving patients right uh whereas if you're you know operating in a coal mine it it's probably a little harder can connect people to any kind of sense of purpose here yeah I also think you know you don't want to condemn Generations as as lazy and shiftless right I I do have some hope that you know if things do get much more challenging there will be people who will step up to it um yeah it gets us by the way you said something earlier that I'm endlessly fascinated by which is you know do the times call forth the leaders you know it's a really interesting you know because it seems to sometimes when you look at history and you see in moments of Crisis right in moments of difficulty certain kinds of leaders emerge right yeah and that actually gives me a bit of Hope right that we may we may see something similar yeah uh and I I do think of course the the type of business that you're in makes makes a difference I mean I I used to work at a movie theater having to upsell people in a concession stand and they used to have contests I had no idea where that money was going or why I was even upselling people uh but then I was I was told another story about the San Diego Zoo where they had the exact same competition where um employees behind the concession stand were supposed to upsell customers but the difference is in that story when they upsold customers and brought in more money the leaders then said hey here's how the extra money that you're bringing in is helping fight conservation efforts like here's how we're going to fight Extinction for this particular animal based on how you're upselling and bringing in more money through the concession stand so I think there are lots of really interesting and creative ways that um we can explore to how to help create that but employees need to play a role and leaders need to play a role yeah no I get it and it's I agree that there's go to there's got to be a reciprocal kind of AR I won't argue with that yeah and to your point I don't think it's generation specific at all I think it's more mindset specific and one of the things that I tell people is there's a very good opportunity for anybody right now who's willing to work hard and push themselves out of their comfort zone and challenge themselves you don't have any employees who want to show up to the office you show up to the office and see what's going to happen to your career you have employees who only want to work 28 or 30 hours a week you work 34 hours a week or 40 hours a week and see what's going to happen to your career so we're kind of at this I think an interesting time where those who are willing to make those sacrifices and to work hard and to push themselves are going to I think reap the rewards to your point as we kind of get through this pretty so where do you Comm oute on income inequality in the US I where does that sit in in the in this picture for you well I mean you know if you you look at the data today you know we've never seen higher levels of income inequality in the US since you know the verge of the Great Depression right yeah and I just wonder you know because I I mean I I I love what you're saying Jacob right and and I really would I really believe that entrepreneurship and initiative and being proactive matters greatly and getting out there and grabbing for something and pushing for something is super important but I also wonder you know if if you're living you know out in those sorts of places you know are are do you really have that level of opportunity or not right you do when you're holding down a couple jobs or so you do you think you do yeah I mean my dad is an example of that um he was an immigrant from the former USSR uh he came to America chasing the American dream uh they migrated from the Republic of Georgia to Italy to Australia which is riy was born to the United States uh they came here no money didn't speak the language had no possessions my dad lived in lowincome housing um in the project in New Jersey and he had a choice he could either live with other Russian and Georgian speakers or he could live with people who didn't speak Russian and Georgian but lived in low income with American speakers he chose to live outside of his comfort zone not in his community but with income American speakers and he learned how to um speak English by watching the Johnny Carson show with a English to Russian translation dictionary um and he he came you know they literally came from nothing so I'm a big believer in the American dream I think a lot of it is you know I don't want to say completely going to hell but there are a lot of challenges right now as far as what's going on in the US yeah I guess that's that's what I would want to explore with you right which is first of all that's fantastic right and I think it's a it's one of the the incredibly inspiring stories that one hears about you know people that came with virtually nothing to the US and and and made good lives yeah and there are lots of those types of stories yeah but do you think they happen today in the same way do you think you know because it just feels like things are different right it does it does feel like things are different it does um yeah I don't know I forgot which podcast I was listening to this was a while ago but they were talking about maybe it was actually I don't want to say cuz I don't even remember but they were talking about we need to redefine what it means to be a hero and I think a big part of the challenge is that we used to hear a lot of those types of Hero Stories back in the day right 70s 80s maybe even through the 90s and then as we got to the era of social media you know 2000s and Beyond you don't hear those types of hero stories anymore Our Heroes today are different right we don't hear those stories about people who've come to America or have come to to any country who've built businesses from the ground up who are learning who are able to take care of their families after they came from nothing like those to me are the Hero Stories and we don't talk about them we don't hear about them they're not in mainstream media we don't right so our idea 100% what we hear what we hear is the Breakthrough of the the Tik Tok influencer right that's that's the heroism of today yeah exactly so our definition of a hero has completely changed and I'm a big believer in what you incentivize grows my wife always reminds me of this too and I'm thinking about different aspects of my business and she's like well what you focus on grows and if we're going to focus on Tik Tok influencers if we're going to focus on Lazy Girl jobs if we're going to focus on don't work hard and and you know try to take advantage in areas where you can if if you're a a victim if you can identify the problems in your company and don't come up with your own Solutions then that's what we're going to create that's what we're going to incentivize that's going to be the new hero and it's not to say that there aren't problems like I get there's lots of challenges there's lots of issues nothing is perfect um but I think there are a lot of that's just one of the challenges that I think we're seeing is just redefining who the hero is and when I hear stories that's interesting when I hear stories from friends or family members that have came here from nothing I'm like that's like that should be the front page of the New York Times Like That should be the story that we're talking about and hearing that you can do these things um so I just wish we we spent more time uh focusing on those but you know do I have a solution to everything no I know you don't and and I know I know that's not what you're saying right at all you know I think where I agree with you is that I feel like we're in a time of kind of cultural malaise right and I think that and there's many reasons why we're in a time of cultural malays and and I think social media has played a huge role in that we're in a time of division right we're in a time of Separation not coming together to do things I mean most good Hero Stories involve the coming together of people to accomplish something yeah yeah to go through the valley together right there's not we don't see much of encouragement for that kind of collective action today there are still people that are trying to do good things for sure right but I think it's uh yeah and I and I think just you know I I you know I now live in Switzerland where which is where I am now and you know but I I look at what's happening in the US and it's just it's just so incredibly upsetting oh it's crazy because you know the US should be the the country you described your came to right you know Bastion of democracy and free enterprise and hope and and you see it just being torn down right to a degree and that's it's super unfortunate anyway we got a little distance off of strategic thinking yeah yeah we're gonna get get to disin and I'll end on one thing that for me the sad thing is like every fourth of July um you know my dad is very proud to hang up that American flag in his front yard and he's not even from here and he's one of the most proudest non-american Americans I know and I could always tell he gets very emotional you know he gets a little Tey when he's putting up that American flag because he came from communism where everything was taken from him where he had nothing where he was persecuted for being a Jew and he comes here and he's able to build a life for himself and I know that every fourth of July he is just so eternally grateful for what this country has been able to do for him and how hard he's been able to work and I just wish more people would talk about those types of well and and there's something so important Jacob in what you're saying too right because you know I look at the people who you know are are complaining about you know XYZ about the way the you know the US runs or something like that and you know I still have enough connectivity to my my father's generation he's passed away but you know um the the Great Depression the second world war you know these enormous challenges and I sometimes think people have absolutely no idea how bad things could get yeah right they have no conception right whereas your father had a conception he knew how bad things could be right and so he's got gratitude for what is right and and I just wish that we could have more perspective about the fact that you know yeah it's not perfect um but you know in historical and other terms it's pretty darn good you know it is yes and if we keep going down the road of tearing it down we're going to end up in a place where you know it's really pretty awful I think more positivity yes um all right so now that we digress a little bit let's get back to your uh six principles um so why don't we start with principle number one which we alluded to a little bit earlier when we were talking about Chess which is pattern recognition um yep so a why is that important and how do you obviously it's one thing to recognize patterns on a in a in a chessboard where you see the pieces moving the certain way how do you actually do pattern recognition when it comes to business yeah yeah so so if it's okay I'm going to wind back really slightly before I answer the question right um because you know when I started think thinking about what is strategic thinking and you know doing the interviews and discussions and so on what I what I decided it sort of came down to is the ability of a leader to recognize emerging challenges and opportunities prioritize the right things and mobilize their organizations to do something about it right and so I anchored strategic thinking in that recognize mobilize prioritize kind of structure right and that's the the overarching structure of uh of the book and then I said okay well so what is it that lets leaders recognize emerging challenges and opportunities right and that really is very much that the combination I think of um you know that pattern recognition ability so seeing what's important in noisy environments in uncertain environments in comp in the midst of complexity and that mental modeling systems capability that then let you kind of make sense out of and do some projection about what this is going to mean right and so if you marry pattern recognition and systems thinking I think you've got the foundations of the recognition part of the the puzzle as it were right and and pattern recognition I mean I it was so so fun that you brought up chess because that was kind of a a bit of a you know it's an example I use and it's a it's a good one right you know how did you learn to see patterns in in chess you played a lot of chess games you you read about Chess you learned from the Grand masters of Chess right um you studied famous games you know that were played and Brilliant moves that were made and you know chess.com has a has a daily puzzle every day right and I do it every single day right it's one of the the problem solving things I do just in the morning just to kind of warm my brain up right yeah I have and they're all drawn from I do them literally like even if I have a couple minutes in between a podcast I pull out the phone I go on the chess app and I don't know about you but to me it helps it's like a form of medit meditation for me where I just kind of sit there are very few things that I can do for hours and hours and hours at a time but playing chess and doing chess puzzles is one of those few things that if I'm doing it I could do it all day yeah and because I started really late with this I'm going through a little bit of a kind of pattern recognition development exercise like for you this is this is refinement largely right at the stage you're at I think probably but for me I'm starting to see patterns and what's going on I look at a chess board now and I see something different than I did when I picked that chess up app up for the first time right and I start solving puzzles and so on and I think you know so then you dissect well how did you get good at pattern recognition with chess well you immersed yourself in the game right you played a lot of games you you found examples you found um you know kind of a form of Mentor in the you know a master and you Apprentice to them right it's exactly the same thing in business Jacob right you to become effective at strategic thinking you need to immerse yourself in a domain and focus on understanding the foundations of that domain and building up a notion of what patterns exist or tend to exists there so that you know that hey this is really not relevant you know it's not going to take us anywhere it doesn't matter and this is wow we better pay attention to that because if we don't you know Checkmate is coming within a few moves right so it's it really is a similar process and I you know I think immersion is part of it I think working for people who are strong strategic thinkers and and understanding how they see the world right what they look for what they pay attention to that can be a pretty big part of it um yeah so that to so to me they're very very similar kinds of um you know processes and that's why it's such a great metaphor I think for yeah for Strat thinking yeah okay let's go to discipline number two systems perspective which we alluded to earlier right um why is that an important discipline and what what is that discipline sure so so system thinking lets you deal with complexity right the world is a very very complicated place and if you're trying to pay attention to every single variable in the environments you're operating in you're going to get completely over overloaded and overwhelmed right not possible yeah and so somewhere yeah no and at some point in you know our evolutionary history we began to have the ability to build you know what is commonly called mental models but I think they're basically systems models you mentioned causality earlier right cause and effect action and reaction if I do this that's going to happen right if I poke the bear I'm going to get eaten you know um and those those are early forms of systems thinking right and then you begin to overlay on that things like uh tipping points in systems or feedback loops in systems right if I if I get this going fast enough become self- sustaining and oh my God it's going to go out of control you know there's fundamental ideas about systems that I think are hugely valuable right um I'd go back to Peter sangi if that name means anything to you in the Fifth Discipline right and systems Dynamics kinds of thinking it's very very analogous right but at its core it lets us create simplified representations of complicated phenomenon that let us make predictions and take action that have a reasonable shot of ending up doing what we think they should do right that's to me is the core of it uh in systems thinking and then the third one is we've already actually talked in fair amount about it I actually jammed through two things together in the in the chapter on mental agility and one is the Chess Master look forward a few moves action reaction you know from Game Theory the the idea of the best response right you look at all the possible moves the the opponent can make and you think about the counter moves and so you think about and then you think about okay well given that they're likely to do these things what's the best response I have or back what's known as backward induction right of of kind of looking forward reasoning backward to the sequence the path that's going to take you there so there's pretty basic ideas that flow and also but I combined that particular chapter with that level shifting Cloud to ground you know kind of ability to move between those layers you know the powers of 10 that you you mentioned earlier and again to me that's a that's a form of mental agility right it's a it's a a mental flexibility and Agility to Think Through potential possibilities or move between levels of analysis and that's again I think a big part of both recognizing and prioritizing what's critical you know and then there's some stuff in the back end of the book you know I think might be surprising for some folks um that I don't think would necessarily commonly be associated with strategic thinking right and they're really more about the mobilization piece right so recognizing prioritizing mobilizing you've got to mobilize your people in your organizations right to to pursue these opportunities or avoid these particular challenges and so how are you going to do that um so and the three chapters structured problem solving so how do you take a team through a process of problem Framing and solving that leads to the best possible outcome but also moves the team collectively in the direction they want to go visioning which I know you've done some studying on that that sort of is sometimes called backcasting right of imagining a desirable future and working your way back into how we're going to start the path of getting there yeah and then I think probably the one that is going to be most strange for people is the last chapter which is political Savvy right yeah how do you navigate complex political environments in ways that let you move energy forward I mean that's I guess the way I sort of I think about it very much in energetic terms right that you're trying to mobilize organizational energy build alliances you know uh get access to resources you know one of this the CEO that's mentioned in the introduction he's just absolutely masterful at you know doing deals you mentioned negotiation earlier that no one thought was possible to be done right because he's got this incredible sophistication in thinking about stakeholders and thinking about political agendas and think about what what you know how do we craft a deal that's that's acceptable what's the right sequence to do things um so so to me that's kind of that you know a core those three things the structured problem solving of moving your team forward the visioning to mobilize the energy of your people right the political Savvy to navigate get get access to resources navigate the deals that you need to do those three things are the mobilization part of strategic thinking in the way I sort of con socialize it okay um so then let's spend the rest of our time talking about how to actually develop your strategic thinking ability so we we went over those six disciplines um so people who are listening and watching this might be thinking okay I got what those six disciplines are they all make sense now what how do I actually put those things into practice all right my conversation with Michael Watkins continues as we talk about how to actually develop your strategic thinking ability and Michael's going to share some exercises that he does on a regular basis and how they help him develop um strategic thinking abilities not just for him but for a lot of the CEOs and people that he works with as well this leaders toolkit episode is only available for subscribers of great leadership Plus on Apple podcast you can do that simply by opening the Apple app Apple podcast app on your phone or on your desktop hit subscribe there's a trial option in there as well and I hope you decide to take advantage of that two other things that I'll mention my book leading with vulnerability is available you can grab a copy at lewith vulnerability. comom and last but not least join our community on substack great leadership. substack Doom uh if you want to get a 20% discount you go to Great leadership. sub.com slgp podcast great leadership. substack docomo if that too confusing and you forget it just email me and I'll hook you up jacobthe future organization.com tell me that you saw this on a podcast episode you want your 20% discount and I will send you the link directly so thanks everyone for tuning in I will see you next time