Pay Attention to Long- and Short-Term Focus When Making Decisions
To be successful in business, you need to focus on both the short term and the long term. You give short-term focus to issues that are concrete, immediate, and predictable. Quarterly reports place focus on the short term, for example. Long-term focus relates to issues that are more vague, uncertain, and perhaps visionary. Long-term vision gives your company direction.
Many businesses exhibit short-termism, the tendency to focus on the short term and ignore (or largely overlook) the long term. The plague of short-termism in business is seductive because it deals with practical concerns rather than big-picture issues that don’t appear to have a direct effect on the bottom line or short-term profitability.
Short-termism can undermine your company’s success. If your internal reports focus on tracking revenue targets achieved over a 90-day period, for example, you may miss key indicators that are only apparent when you take a longer view.
Unless someone keeps an eye on the longer term, no one has a reason to look up and, therefore, will not see the bigger picture or recognize important changes in the business and global environment. This lack of awareness makes your company vulnerable and likely to be taken by surprise.
The solution is to balance your long- and short-term focus. Doing so is essential for your business’s financial success and its sustainability.
Highly successful companies balance short-term and long-term views. Consider the newly emerging social enterprises that use a very wide lens, one that integrates what is going on with the planet and society with their business goals.
Their view that everything is interconnected compels them to tackle larger environmental and social issues that impact the economy as a whole because they understand that those larger forces also impact their businesses! This view gives companies a serious leadership edge.
Taking the long view
As a leader and decision-maker, you must consciously work with short- and long-term focus simultaneously. Doing so helps ensure that you are prepared for the future as it unfolds, often in a way that you cannot imagine. If you and other decision-makers are focused on the short term, you must integrate long-term focus to balance your insight. Here are a couple of ways you can instill long-term focus:
Determine your company’s strengths and how your company can contribute in a larger sense. For example, many companies make serving society and protecting the environment a key part of their focus. Finding out the strengths of your company leads to a vision of serving a higher purpose, which inspires employees beyond measure.
Find out which practices are impeding your company’s ability to pay attention to both the short term and the long term. Examples of practices that commonly stifle your ability to focus on both long- and short-term issues include focusing solely on market share or on building the bottom line, or operating in constant crisis mode without examining whether the crisis is real or is simply an adrenaline hook.
Engage your staff to share their insights and ideas. Doing so can clear the path for collaboration. Involving employees in deciding what the longer-term vision looks like, for example, is a great way to both inspire your workforce and to come up with a meaningful vision. Employee engagement is a vital ingredient to successful decision-making.