To Generate Successful Strategic Improvements, Start by ‘Backcasting’

I’ve seen many improvement efforts conduct a value stream map to review the current processes. Then comes a defensive discussion of people having to justify why they’ve been doing what they’re doing for years—and why it’s going to be impossible, difficult and even unlikely to change.

Try this instead: start with the future state you want to achieve, then backcast
Backcasting involves defining a desirable future and then working backward from the vision to the present. The fundamental question of backcasting asks, “If we want to attain a certain goal, what actions must be taken to get there?” So, before jumping into the analysis, cast a vision of what winning looks like in your future state.

Start by recruiting a group of key stakeholders to participate in the exercise. Next, establish a set of parameters around the time frame, actions, risks and opportunities that the facilitator will use during the backcasting exercise. Then clearly define your future state by challenging your team to do the following:

• Imagine a situation with no constraints. Design your business model, workflow processes, and the behavior of your team as if you are starting a business from scratch. This is typically looking out 5-9 years. It’s long enough to change everything that needs to be changed—products, markets, strategy, business model, pricing, go-to-market channels, people, production technology, information systems, locations, etc.
• Capture how your customer will behave. Record what they will say about working with your organization and the position you will have in the marketplace.
• Create a list of your best growth opportunities and all of the problems you hope to resolve over the next few years. Describe your organization once you achieve the growth opportunities and all of these problems are resolved.
• Paint a bold, winning and relevant vision. People want to be part of a winning team.  Customers will purchase relevant products and services. And investors will bet on bold growth opportunities.
• Consider the future state and work backward. Identify actions, assumptions, risks, benefits, and other indicators that will lead to these winning outcomes.

Once your employees, customers, and investors can all clearly see and feel what it means to achieve the set goals, they will be better able to backcast the details of what it will it take to get there. To have a great future, think from the end: envision the future and work backward.