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21 Jul

4 stages of evolution in business thinking and acumen

Everyone wants to make the big bucks.

Everyone thinks “strategy” is what they have to do in order to make those big bucks.

And everyone wants to be in a think tank and tell people what to do, without having done much themselves.

So, to cure you of your delusions of grandeur, let me give you a rough and approximate overview of the 4 stages you will go through in your career as a business professional.

1) Thinking in Tasks.

The first stage of your business career will often begin at the task level.

This is where you will learn the fundamental skills necessary to perform specific tasks or duties within your role. You will understand how to do specific tasks well. This could be anything — from sales calls to creating marketing content to financial modeling, depending on the role.

Say you're a newly hired salesperson or business development associate. When you start, you're busy learning the product range, understanding the needs of the customers, and practicing the company's sales pitch.

In this stage, your mindset is reactive. You respond to customer inquiries, follow the sales scripts, and apply the fundamental rules of sales that you were taught during training. Your aim is to drill these basic activities over and over again, until they become second nature, much like how you would repeatedly practice the chords and how to smoothly transition between them while learning the guitar.

At this stage, a lot of your learning will also be about understanding the immediate consequences of your actions. This might mean seeing the link between the effort you put into understanding a customer's needs and your likelihood of making a sale. Or the impact of having a good hook on your cold email open rates.

In short, you learn the association between particular actions you take and the immediate reactions. This stage is very much about cause and effect.

“If I do X, Y happens.”

Reading this, you may argue that the way I'm describing this stage seems overly simplistic. And yes, while this stage is simple, it is by no means trivial. Just as learning syntax is the foundation of coding, understanding simple cause-and-effect relationships is the foundation of business.

There's no shortcut here.

To move to the next stage, you must put in the hard work to drill the basics, to practice them over and over again, much like a martial artist would practice a particular kick until it becomes second nature.

Of course, there's a strong temptation to rush through this stage, to get to the “interesting stuff” as quickly as possible. That would be a mistake. The simple actions and reactions that form the base of business acumen are essential. They're not sexy, but they are the foundation upon which everything else is built. If you don't understand them deeply, you'll stumble when you try to move on to more complex topics.

And the beauty of this stage?

You can forever stay here and still make an absolute killing in terms of money. As this stage is all about mastery of specific tasks, there's scope to go deep and become the absolute best at one particular thing in your industry.

So yeah, it isn't as trivial or amateurish as it sounds.

In fact, without a basic understanding of how to execute these tasks, it's hard to advance in a business setting. However, as with syntax in programming, this doesn't mean it's the most important aspect of the work in the long run. It's just where many people begin.

But if you wish, you can choose to stay at this level and achieve world-class proficiency in a specific skill. Many do. But, there's a catch:

The way you arrive at this level of mastery is by understanding your way through all four stages and then finding a home in Stage 1.

(I do not expect you to understand this today, but I hope you will, someday.)

2) Thinking in Functions.

The next evolution in business thinking is often around the functional or departmental level. This is when you, as a business thinker, start to understand how your tasks and role fit within the broader function or department you're part of, and how that function interacts with other functions within the business.

You start to grasp the interconnected nature of a business and appreciate how different functions contribute to the whole. For instance, in marketing, this could involve understanding how the creative process, market research, and data analysis come together to execute effective campaigns.

You're now moving from learning the basic grammar of the business language to constructing coherent sentences. This stage is all about recognizing and understanding larger patterns.

In sports, after you've learned to dribble, you'll start to understand how to pass the ball, how to make a layup, and how to navigate the court with your team. It's the same in business. You are now starting to piece together the individual actions you've mastered to understand more complex, integrated systems.

After mastering your basic sales techniques as a business development associate, you now start to slowly perceive the bigger picture. You begin to recognize more general and widespread patterns in customer behavior, or in how different sales strategies yield different outcomes. You start to understand how different components of the sales process interrelate. You start to see how one step in the process affects the other.

This is all pattern recognition – you're now starting to see in parts, and the play of their interrelationships within a more extensive system.

It's also at this stage that you begin to see how your role fits into the broader organizational structure. You start understanding the interdependencies between sales, marketing, operations, and finance. For instance, you may realize that an effective marketing campaign can significantly boost your own personal sales numbers, or that a disruption in operations can severely impact product availability and, in turn, impact your sales outcomes.

Learning in this stage is less about individual skills and more about developing an understanding of systems. It is crucial as it's where people start to make more strategic decisions based on pattern recognition and understanding the system as a whole.

3) Thinking in Strategy.

The third stage, strategic thinking, is when you start to consider the larger function as a whole, and how it ties into the business.

At this stage, you no longer think of marketing, product, and sales as three different functions but understand how they're both integral to each other and feed into one another at a lower level of analysis.

You start thinking in terms of the overall business strategy, how marketing and product decisions play into this strategy, and what it means for the sales department. This will involve a more abstract way of thinking, understanding how different elements of the business interrelate, and how decisions in one area can affect the whole.

You will now also be conferred with higher levels of leverage, where your keen insight and judgment around the business can direct the business towards better outcomes. But with higher leverage, you will also have higher accountability, where the cost of a wrong decision will be significant and the emergent risks from those decisions will be higher.

Consequently, you will also need to develop the skill of coordinating with different departments to approve and implement your decisions. You will realize that translating your decisions into actions is no longer as easy as it was when you were an individual contributor at Stage 1; it is now about project management, communication, and negotiation.

At this stage, you will begin to think about the knock-on effects of your decisions. You're not just focused on getting the sales numbers up but also on how his decisions might impact other aspects of the business, like operations or customer relations.

You will now understand that not every decision will lead to a positive outcome, and you start thinking about how to navigate difficult constraints and trade-offs. For this, you will require a deep understanding of the company's resources, limitations, and culture. You might have the best sales strategy in the world, but if it doesn't fit with the company's resources or culture, it will be a struggle to implement. You will need to know what's possible within your organization and how to navigate its systems and structures with shrewdness and dexterity.

At Stage 3, you move from being a player in the game to being the coach or even the general manager. You're no longer just reacting to the play at hand but shaping the overall strategy and directing the team.

And most importantly, in this stage, you're no longer relying on standard procedures or practices but dynamically adapting to the situation at hand.

4) Thinking in Culture and Change.

The final stage of evolution is thinking in terms of culture and change.

At this level, you will not just be concerned with what the business does or how it does it, but why it does it. You will think about the business's culture, values, and purpose, and how these elements drive the business strategy and impact the business's operations.

This is the place where the human variables of the business equation will come into play.

And I'm not talking about job descriptions, workflow diagrams, or quarterly targets here. I'm talking about delving into the soul of the organization, the shared ethos and collective spirit that defines how things get done.

You see, culture is a bit like the water in a fish tank.

We're all swimming in it, but it's so all-encompassing, so inherent to our environment, that we often fail to notice it. But culture, this unseen, unspoken amalgamation of beliefs, values, and norms, exerts a tremendous influence on how we behave, interact, and ultimately, how we perform.

In this stage, your key task will be to cultivate an awareness and understanding of these cultural elements. It'll be about perceiving the unspoken rules that guide behavior in meetings, the values that are rewarded and those that are implicitly discouraged, and the subtle underlying preferences and attitudes that your team harbors.

At this stage, you will understand the often-quoted maxim:

“Culture eats strategy for breakfast.”

You will spend a lot of your time understanding how the unique and complex cultural fabric of your organization is revealed in the way it does things, and how that underpins every action and decision in your company.

At this stage, you will also start seeing yourself as a change agent.

You will figure out how to identify the need for change, develop a vision, create buy-in, manage resistance, and drive the change process to successful completion. You will learn how to shape the culture and guide the business towards a more robust future.

This is unlocking the final door in the maze. It's the key to influencing behavior, guiding decisions, and ultimately shaping an environment where people feel valued, engaged, and empowered to bring their best selves to work every day.

After all, there are no business problems, there are only people problems. And understanding people, the cultures they create, and the changes they navigate, is arguably the most important business skill of all.

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