Red Team

To create your smart strategic plan, try a ‘Red Team’ approach

In most circumstances, the shortest distance from where you are to where you want to go is a straight line.

If you’re a small-business owner and you want to get something done, the easiest approach is to have a short meeting, weigh in with your managers, make a decision, and then mandate the change. This approach works well when the issues are black and white, or a trend has been clearly established in your industry.

However, when you are faced with highly ambiguous challenges, unusually thorny problems or questionable untested initiatives, a straight-line approach can lead you straight into trouble. That’s because change blindness can set in too easily.

Change blindness occurs when distractions are too great, the information is confusing or the overload is overwhelming. If that sounds like a normal day at the office, read on.

Becoming imaginative

The danger of change blindness is that when companies are faced with overload and ambiguity, the natural tendency is to assume that what has happened before will happen again. That kind of linear thinking can lead to disaster.

A perfect example is the wake-up call our country experienced on 9/11. “Failure of imagination” was cited in the 9/11-commission report as the primary reason U.S. officials misjudged the threat of the terrorist attacks.

Government officials never imagined someone would think to fly planes into the World Trade Center because it had never happened before, and there was no reason to think it ever would. However, there were plenty of others who could and did imagine such a scenario.
Our military defense complex quickly realized if we hoped to prevent future terrorist attacks, we would need to move beyond traditional thinking and become as imaginative as the terrorists.

That realization led in part to the creation of so-called Red Teams. Red-teaming was developed as a tool to help circumvent linear thinking, and the U.S. Army defines the concept as “a structured, iterative process executed by trained, educated and practiced team members” that provices commanders “an independent capability to continuously challenge plans.”

Red-teaming has been successfully adapted as a bite-sized strategic planning tool by the business world, including at our company, where we employed the tactic at Mortenson Construction. This excerpt from Nick Tasler’s new book, Why Quitters Win, helps explain the how and the why of Red Teams:

“A few years ago, David Mortenson, the executive vice president of Mortenson Construction, stared across the table at four strangers. At the time, the economy was starting to slump and taking the construction industry down with it. Residential building had nearly screeched to a halt and commercial building wasn’t far behind. The Mortenson executive team found themselves presenting the strategy for their company’s future to this small group of visitors.

They weren’t bankers. They weren’t customers. They weren’t board members. They were the Red Team. Four months prior to that day, Mortenson Construction had called in a boutique strategy consulting firm that I work with called The Prouty Project. They wanted the Prouty consultants to help them reimagine what they could do to maintain their competitive advantage in the brave new world that was fast approaching.”

How did the Red Team help accomplish that goal, and how could you apply the concept at your firm? First, some logistics. Red Teams are typically made up of several of the company’s top leaders, a couple of strategy consultants, and four outsiders who are successful executives and business leaders from a broad range of backgrounds. Because they come from very different worlds, they are far less susceptible to change blindness.

That’s important because, as Nick writes in his book:
“Even the boldest leaders have moments of self-doubt—not so much about the quality of their judgment, but about which variables they might not be able to see or control.”

The half-day Red Team session ended up being a good investment of time and energy for Mortenson, and it’s the kind of tactic that can help any business owner. The outsiders were able to shed light on some of the real risks lurking in the shadows. Addressing these risks helped the company neutralize doubt and implement their new strategy with clarity and confidence.

The exercise also helped change the internal culture in a very positive way. Input helped the company realize that “on time” and “under-budget” wasn’t a valid differentiator—the company needed to deliver an exceptional experience, not an expected one. That simple shift changed how Mortenson looked at every aspect of their business.

Ultimately, the changes implemented helped the company increase their lead and take market share from their competitors. Their business expanded dramatically during the four years of the recession, despite an overall 40 percent commercial construction decline.

The collective wisdom of a team like this can help small businesses:

  • Uncover new opportunities by broadening the possibility horizon across multiple industries;
  • Solve ambiguous problems by crafting hybrid solutions that don’t fall under the category of standard operating procedures;
  • Navigate uncharted territory by taking advantage of what is essentially a one-time board of advisers;
  • Mitigate uncertainty by stress-testing plans against the collective wisdom of outside experts before presenting to customers;
  • Re-imagine tomorrow’s products, marketing challenges, and financial hurdles by neutralizing change blindness.

Let’s face it. Customers are getting smarter. The competition is getting better. Life is getting tougher.

An experience with a group of smart outside advisers like a Red Team offers a slight detour from the traditional straight-line decision process—and could help your drive your company further into the black.

Robyn Waters

Red Team Ambassador