The Power of Stretch in Executing Strategy

by Tara Rethore on April 4, 2013

Last stand Six months ago, I walked into a meeting of our elementary school Parent Teacher Association (PTA) with a dream, a challenge, and a Big Hairy Audacious Goal (BHAG).

Our dream

We knew that environmentally-based education improves scores on standardized tests and develops critical thinking, creativity, and problem-solving skills – all key to success in the 21st century.

So, we envisioned bringing the outdoors into our classroom – by taking our classroom outdoors. Thus a design was born to provide a cool new space for learning. A few small grants and donations helped plant the first seeds, and our community weeded, watered, and hauled mulch.

And, yet…

The Obstacle

Our space wasn’t accessible to all of our learners and staff. We needed pavers for a patio, and paths that all of us could use. We wanted an eco-friendly solution to support our journey to become an Eco-School – and demonstrate our commitment to our world.

But, our Distinguished Title I School had no funds to spare; finishing our classroom seemed a long way off.

Our goal

We intended to raise $10,000 to pave the patio of our outdoor classroom. For us, that was the biggest, hairiest, and most audacious goal we’d ever seen. That represented a 50% increase in our annual budget. Could we really do this?

In business, a BHAG is not a new concept.

Yet few in the room that night had thought about it in this context. Like many PTAs, we routinely raise money for a variety of enrichment and community-building activities. And while we have an annual budget, we do not habitually think in terms of specific revenue goals, at least not for individual fundraisers. So setting a clear project goal – and a hairy one at that – was very new for us.

Remarkably, many businesses also overlook the power of stretch in achieving their strategic objectives. Most do set revenue goals, maintain a budget, and monitor progress toward those. Publicly-traded companies in particular, report regularly on earnings and their performance can impact stock price.

What’s often missing, however, is audacity – stretch. Stretch can propel you forward, or leave you hanging.

In strategy development, it’s important to find the right amount of stretch between what you hope to achieve and your current position. Picture a rubber band holding a bunch of papers. Too much stretch, and the rubber band breaks; the goal becomes unreachable. Too little, and stuff falls out; you miss opportunities or leave money on the table.

The right amount of stretch holds the papers in place without damage or loss.

But notice something else: the right amount of stretch requires consistent and perfect tension at all times from all angles. The goal is achievable, but it requires unrelenting, well-orchestrated pursuit of the objective. Importantly, that is also a hallmark of effective strategy execution – and the power of stretch.

Three steps to unleash the power of stretch and execute your strategy better:

  1. Begin with the end.

    By design, a BHAG has stretch. It’s forward thinking and typically, well beyond conventional wisdom or your current reality. Many companies set goals starting with where they are today or what they see on the horizon. While not inherently bad, that approach sometimes leads to incremental improvements, not the step change typically required by a BHAG. Instead, ask: What could be?

  2. Get comfortable with ambiguity.

    Audacity requires courage and a leap of faith. Jim Collins suggests that the appropriate amount of audacity is having a 50-70% likelihood of success, if you do everything right. That means there is a good chance you don’t have all the answers today and in fact, you may not know all the questions. When President Kennedy announced in 1961 that the US would send a man to the moon, NASA had neither all the answers nor all the questions. Yet, that BHAG and the President’s audacity set us on a course that would span generations. Ask: What will it take?

  3. Close the gaps, one by one.

    Strategy is the collection of decisions you’ll take to reach your objective. To execute strategy effectively, you must close the gaps between where you are today and where you want to be. Stretch often signals whether you are doing that systematically and deliberately. Ask: What’s next?

The power of stretch is relentlessly asking and answering the above questions. Constantly adjust the tension to allow old things to fall out and make room for new opportunities – while simultaneously remaining focused on the end game. That’s effective strategy execution.

Oh, and about our ‘little’ project?

We recently placed the last permeable brick in the patio of our outdoor classroom. Our BHAG drove relentless, focused pursuit of the goal – creating an attractive, accessible place for learning and embracing our environment. We dreamed about what could be and determined what it would take. We paved our patio and literally laid the foundation – one brick at a time.

Having exceeded our goal by 40%, today we’re asking: what’s next?

Flickr image courtesy of Garry Wilmore

Tara RethoreCEO of M. Beacon Enterprises, Tara Rethore works with mid-sized businesses to develop strategic priorities at multiple levels and solve complex problems. That means ensuring the right decisions and steps are taken to go where they want to go. She’s adept at breaking down complex concepts into a few, critical themes to shift thinking and deliver results.

In industry and as a consultant, Tara has applied this across a variety of industries, globally, and in mission-driven and for-profit contexts. She knows what it takes to succeed, to execute a strategy, and to go from vision to reality. Tara earned an MBA from the University of Chicago and an A.B. cum laude from Mount Holyoke College. Tara can also be found commenting on business strategy, execution, and results on Twitter and LinkedIn.

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