Share

 

Buying the Future

February 4, 2010 — Speech given by Ralph Shrader (Booz Allen Chairman & CEO) at the AFCEA West 2010 Conference.

To begin this morning, I’d like to ask you to imagine it’s a year from now, February 4, 2011, and some frightening things have happened in the past 12 months. It’s your job to go back in time to today, and make things turn out differently. It’s up to you to set things right, to save the future.  It could be the future of our country, your organization, an individual colleague, or even your own future.  

The sci-fi mavens here in the audience can probably name dozens of movies, books, and TV shows built around this plot, including the current hit Avatar. Personally, I’m more of a casual fan who enjoys the escapism of Star Trek, and I find it striking how many heroes -- from Captains Kirk and Piccard, to Denzel Washington and Nicolas Cage in more recent thrillers – find it in their job description to “fix the future.” 

I’d like to propose a radical thought: Think about this – while these are fictional characters and actors, we’re for real. And it’s my real job and your real job to fix the future, and lead others to buy into it – into a successful future that’s on a different course than where we were headed with the status quo.

And, we have a harder job than these sci-fi heroes. They get to go back in time after “seeing what happened,” and we have to anticipate forward what might happen.

Before you think I’ve ‘lost it,’ consider the theme of this conference around the Quadrennial Defense Review.  The challenge of the Quadrennial Defense Review is to ensure that the US military is preparing both strategically and technically to fight the next war, not the last war. There’s no question the next war is going to be different. The same is true for corporations who have to win competitive battles in the marketplace.

So, military and civilian leaders need to be informed by the past but not bound by it because the dynamics of the future will be entirely different. This is what I want to talk about this morning: A leader’s critical job is to  understand the threats to the “status quo” future… then to envision, help create, and help others understand and buy into a successful, different future.

First, let’s look at the need to face up to the threats of the future – especially the threats that lie directly ahead of us in the straight-ahead or “status quo” future. Then, I’ll share a perspective on envisioning a successful, different future and how to lead others to buy into this “alternative” future. And, I’ll finish with some ideas on the importance of experience and optimism in getting there.

So, to tackle the first part, we need to ask ourselves why is it so hard to face up to the threats of our current situation -- whether that situation is the military’s force structure, our company’s market strategy, or a close personal relationship?  We also need to examine why we don’t see and embrace opportunities to make things better.

Centuries of human history have shown that we’re generally good at making incremental improvements along the same path, but notoriously bad at making fundamental changes. My colleague Mark Herman, an expert on wargaming at Booz Allen, has seen this play out in hundreds of wargames for the military – including games that helped frame issues for past Quadrennial Defense Reviews and wargames for corporations in which the battle was for market share.

In scenarios and in real life, Mark observes, “Human nature is driven much more by fear than by opportunity.” It’s natural and comfortable for us to stay focused on the status quo – on the path we’re on. After all, ‘life as we know it’ has worked for us.

Especially in organizations, people become entrenched in, and fight to maintain, the status quo because power, prestige, and privilege is tied up with it. The problem is that the future is always right around the corner, almost certainly on a different path. But we are blinded to it by two things – first, our natural tendency to hang onto the golden rule of “If it ain’t broke, don’t fix it,” and second, the fact that there is a time-lag before the bad news and discontinuity hits. That’s why it may appear better to stay in the “seemingly safe” present and avoid the dissonance of things about to explode.

But explode they do. Whether it’s Pearl Harbor exploding the dominance of the battleship navy, or failures in Vietnam exploding the US self-view of “never losing a war,” or September 11^th exploding the notion of a secure homeland, old models will fall.

No question, the future is a scary place, full of potential calamities. But, who among us would not want the future? It is unquestionably our greatest gift.

So to move on to a more hopeful part of my remarks, how do we envision a successful, different future – a new way forward that better deals with the threats, and creates real opportunities ahead? Even more important, how do we motivate others to buy into this “alternative” future?

There’s a one-word answer: Leadership. It is up to us to save the future.

While I started out with a sci fi reference about “saving the future,” our challenge is true-life drama. It’s imperative that we as leaders in government, the military, and organizations face up to the threats of the future, envision a new path that reduces threats and opens up opportunities, and – hardest of all – we need to help others buy into the future.

Change itself can create a competitive advantage. Adversaries on the battlefield can anticipate our moves, so we have to keep changing our strategies and tactics to stay ahead. This holds true whether the opponents are the other team in this Sunday’s Super Bowl, or an upstart company that we don’t even envision as a competitor today.  And it holds true for rogue states or terrorists threatening our nation’s security.

We’re seeing a number of examples today where change is creating competitive advantage in the defense arena.  The Navy under Admiral Roughead has made the bold move to set up the 10^th Fleet, focused on information dominance and cyber power, rather than traditional naval warfighting.  And the Navy is adopting technologies with an engineered capacity for change such as JTRS, the Joint Tactical Radio System that connects battlefield voice, video, and images, and uses software to continually shift frequencies.

Smart power, a theme of this conference, is another example of change creating advantage. We saw the benefits of hard power – military force – for winning  conflicts, but also saw the limitations of hard power in securing the peace and building a future in places like Kosovo and Serbia. That’s when soft power – in the form of assistance from USAID for infrastructure and nation-building – started making a difference. Together, hard power plus soft power equals Smart Power.

How, then, does a leader know what to change and what not to change to chart a new path to reduce threats and seize opportunities?

If leaders surround themselves with strong people, and are good listeners and analysts, usually, the decision itself is not the hard part. My colleague Mike McConnell is no stranger to envisioning the future. After retiring from the Navy as Vice Admiral and head of the National Security Agency, Mike has spent a decade in senior leadership roles at Booz Allen, and served as Director of National Intelligence from 2007 to 2009.

Mike observes, “After all the information and recommendations are studied, the strategic decision itself is often fairly simple. What’s really hard is getting change accepted.” He points to the clear need and decision, but then great resistance, in creating Special Operations forces, which today is our force of choice for irregular warfare.  Soft power was also initially resisted by the military – until everyone started working together and training together, and understood the challenges and benefits of their combined “smart power.”

For a great, timely example of soft power, consider the global impact of the USNS Comfort aiding the people of Haiti.

In the civilian world,  I’ve lived the challenge of seeing  the need for change, but struggling with resistance, even my own resistance, to buy into a different future. The different future I’m referring to is the one we chose 18 months ago – to separate Booz Allen into two companies.

The last thing I wanted to be was the one who broke up Booz Allen Hamilton. I joined in 1974 and moved through the ranks before becoming CEO in 1999. In recent years, however, it was becoming increasingly clear that we had a serious problem, one that was keeping us from competing as well as we could have.

Our firm was composed of two sectors— a classic commercial management consultancy and a public-sector business—and relations between the two had become challenging as the public sector business had grown much bigger. Complicated power dynamics—mixed with very different business models and economics—had made running them as a unified entity almost impossible.

It took a lot of time and soul-searching, and leadership on all sides to find the way forward. Ultimately, nearly everyone reached agreement to separate the businesses into two different companies— as evidenced by a 99.76% vote in favor. We were able to see, and help each other see, that the differences affecting both businesses were so great that some kind of break was inevitable. Otherwise, we would lose the ability to define and design our futures.

The question we asked ourselves was: Wouldn’t it be better to control our own destiny, at a time when the business was strong—rather than have to react to events when it might be weaker?

Since the separation, for those of us in what had been the government sector, surprisingly little has changed.  And, for those of you who are our clients, I trust you have not seen changes – other than an even more committed focus on the mission of our core US government client.

While embracing our new future, we hold strong to important parts of our past.   I’m convinced that Booz Allen’s management consulting heritage is what sets us apart. We don’t have customers, we serve clients. We look beyond the requirements of a single contract to look at the broader context of our client’s enduring mission.

These are things that a 95-year management consulting heritage has instilled in us, and they continue to serve us well in the 21^st century.

So, what lessons can I share from this dramatic change to redirect Booz Allen’s future that might help you as leaders help others to buy into the future?

Above all, experience and optimism are critical, and will help convince others to follow us into battle.

Experience is sometimes discounted and misunderstood as “the way we’ve always done it.” That’s not experience, that’s closed-mindedness. True experience opens our minds, because it combines valuable lessons from the past with an ability to make connections and see the possibilities that only a trained, inquiring mind can see.

Experience counts at all levels, and it can be shared through training, mentoring, and professional interactions like this conference. Booz Allen Principal Tim LaFleur, who headed the Surface Navy when he was Vice Admiral, points to the dramatic life-saving improvements that training accomplished in aviation. In World War II, deaths from aviation training rivaled those on the battlefield. Today, training accidents in the Navy have been reduced to less than 2 in 100,000 flight hours.

There’s no question that experience counts. Experience gives leaders both the insight to make the right strategic choice and the credibility for others to follow and buy into it.

But experience alone is not sufficient. Leaders also need optimism. The future is a scary place, and followers will not go there unless their leader can show why the new future will be better than the path they’re on.

The best-selling business author, Marcus Buckingham, said, “The opposite of a leader isn’t a follower. The opposite of a leader is a pessimist.”

With that in mind, the thought I want to leave you with is this:

Whether we’re responsible for a command or a corporation, or any part of one, we’re responsible for the future.

It’s daunting, but incredibly exciting – to chart the course and lead others to follow. Every day we wake up to this adventure – our real-life drama that beats any sci-fi plot.