The Long-Term Problem of Short-Term Actions
This guest blog post is by Michael Butera.
Every day individuals, executives, corporations, both for and non-profit, and government make decisions. Often these actions are the resulting problem. Time is always seeing as short and demanding an immediate response. To be sure, in some situations, immediacy is essential. Unfortunately for too many decisions are seen as short-term and ordering of the quick act.
What contributes to the short-term decisions? Crisis thinking. Need for instant gratification—perceived fiscal urgency. We think real leaders make quick decisions. And maybe most perplexing is the idea of the act now, and somehow we can correct our missteps later.
Some may be familiar with the marshmallow experiment conducted at Stanford University. In this experiment, children had an option of immediate gratification versus a higher reward for waiting a period. One can look the investigation up on the internet. We learned through the experiment that in later life for these youngsters, those who decided to wait for the gratification received a higher reward, demonstrated higher SAT Scores and lower body mass index. As parents, 30 years later, they continued to show higher competency rates.
The McKinsey Global Institute develop a similar experience in the corporate community. Their findings showed that businesses achieved greater earnings, higher revenues, higher profits, economic superiority over competitors, and created more jobs if they could suspend gratification. They also found that these companies recovered from the 2008 – 09 fiscal crisis more quickly.
Short-term problem solutions often sacrifice long-term well-being: failure to recognize the impact over time, a lack of crisis planning, little institutional practice of alternative scenarios, and once again, forgiveness will come later. Rarely considered is the long-term effect, if at all.
It takes a shift in mindset to recognize that short-term actions create long-term problems that, by degree, are detrimental to our personal and business success. How then do we employ a framework to act appropriately in the short term without creating long-term problems?
First, practice stewardship above leadership. What we leave behind for the future is more important than being seen as a robust and capable leader. Learning to develop an individual and corporate capacity culture where we build our personal and group talent is necessary to handle an ever more complex and technologically advanced environment. Third, consider strategic foresight
In that context, how we frame issues or problems, what scanning have we done of the environment, what forecasting have we engaged, is the proposed action consistent with our vision, and do we have contingency plans? Are we practicing scenarios long before these problems occur?
Our long-term planning helps us avoid short-term decisions and actions that create long-term problems that we must solve individually or in the business environment. Our continuously monitoring and evaluating our capacities while learning their impact against real-time experiences will dramatically improve our effectiveness.
As Darwin pointed out, it is not really “survival of the fittest” but rather those best able to adapt to their environment. Executives and individuals should practice for the unexpected. Our scanning should be a personal and institutional wake-up call to potential problems that we must resolve. It is better to exercise your crisis action Road plan than to find that your repair requires more and more rehabilitation. Act with the future in mind.