Strategic Leadership and Decision Making

3

INFORMATION AGE AND STRATEGIC DECISION MAKING

The one thing we can be sure of is that the world that will emerge from the present rearrangement of values, beliefs, social and economic structures, of political concepts and systems, indeed, of world views, will be different from anything today imagines.

Peter Drucker "Post Capitalist Society"

As the future is uncertain, the only thing relatively clear is that much of what we will experience in the future will be different from the past. We must understand it is not information or even technology that will produce this unprecedented change, but the impact of technology on all aspects of human life; not computers or even bits and bytes, but the ability to apply and integrate rapid technological change. The focus must not be on the World Wide Web, but instead on how the Web influences values, beliefs, social and economic structures, politics, our view of the world and the way we think and behave.

Futurist John L. Peterson forewarns that, "We are living in a period of time that will produce more change for humanity than any previous era in history." Peterson and many others believe that wholesale change is and will continue to take place in every segment of the world and that the pace of that change will continue at an unprecedented rate, gaining momentum with time. If this futurist is correct, the coming decades will have staggering implications for the environment and present both hazard and opportunity for the strategic leader. In fact, Moore's law suggests that memory capacity will continue to double every 18 months. If senior leaders want to take advantage of this fast paced, changing world and avoid the pitfalls associated with it, Peterson believes they must understand at least three things.

IN THIS NEW WORLD:

Will leaders focus on shaping a fast changing environment to their organization or will they focus on creating an adaptive organization that will adjust to meet the fast changing environment?

Crucial question: "Is the leader of the future going to control technology or is the technology going to control the leader"?

Alvin and Heidi Toffler have been writing about the emergence of a "new civilization" where humanity advances a quantum leap forward to a future fraught with deep social upheaval and massive restructuring. The Tofflers call this new civilization the "Third Wave."

Think about a wave in a large body of water and you will begin to see Toffler's model of change. Multiple waves may exist at the same time, one following another, building momentum and crashing into the shore across many fronts. Often one wave will crash into others creating a violent and chaotic milieu. The global environment also can be turbulent, full of currents, eddies, and maelstroms which conceal deeper, historic waves. Conversely, a wave may cancel out another. In the real world, crests and crosscurrents created by waves of change exist in work, family life, attitudes and even morality. The human race has already undergone two great waves of change, the Agricultural and Industrial Ages. The third, Information Age, wave suggests a new civilization, new ways of working, living, and competing. It will produce new economic structures, new politics, new security issues and new ways of thinking and decision making.

It is important to understand the impact of not only just information and technology on industry or the economy, but about change in all aspects of human life. This "New World" will have its own distinctive outlook, its own way of dealing with time, space, logic, and causality.

WAVE

PERIOD

ACTIVITIES

TIME SPAN (years)

**** Hunter/

Gatherer

Nut/berries/

game

Tens of Thousands
First Wave Agriculture Age Farming Thousands
Second Wave Industrial Age Mass production Hundreds
Third Wave Information Age Specification/info Decades

Alvin and Heidi Toffler see this as a revolutionary period of change. Moreover, they assume that the coming decades will be filled with turbulence, upheaval, and violence. They also believe that the third wave world will not destroy itself but instead transform the way people all over the globe live, work, play, and think. The old ways of doing things simply will not work any longer in this new environment.

The information age is upon us! None of the items in the list below existed just three decades ago.

THE LAST THREE DECADES HAVE PRODUCED:

Cellular phones

Cable TV

Home Computers

Compact Discs

VCRs

Fiber optics

Broadcast satellites

CNN@

Automatic tellers (ATM)

Super Bowl

Microsoft@

Federal Express@

TV@

Internet or the WWW

Laser guided Munitions

Stealth

GPS

M1, F15/16/117, B1/2

If we look at John Petersen's discussions of the future, they begin much like the Toffler's. He also describes humankind as hunter-gatherers for the first 35,000 years, but opens his first period with the agriculture era about 5,000 years ago. Petersen identified this era with the beginning of formal written communications and the first movement of people into towns and cities. Only 500 years have passed since the beginning of the third era, "the industrial revolution," an era much like the second wave of Toffler's wave theory but marked primarily by the invention of the printing press. Peterson, like many others, calls the current era the "information age". He marks the beginning of this era with the arrival of the microcomputer about 25 years ago.

PETERSON'S PARADIGM SHIFTS

25,000 First notational Hunter-gatherer
5,000 Writing system Agriculture
540 Printing press Industrial
27 Microprocessor Information

The 15th and 16th centuries characterized a renaissance, an age of enlightenment. The changes the world had a profound effect. According to John Peterson, the information age will characterize the "super renaissance." Much like the renaissance of the 15th and 16th centuries, the "super renaissance" will have long-term implications:

15th and 16th Centuries 1980 - 2020
Newtonian Physics Quantum Mechanics
Renaissance/enlightenment - Microprocessor
Printing Press -Super Renaissance
  Ecological Threats

One of the most interesting aspects of the Peterson's model concerns the length of each succeeding era. A review Peterson's time pattern implies that the information age might only be 40-50 years long. We may already be half way through the shortest and most explosive era of human history.

TECHNOLOGY AND THE STRATEGIC LEADER

One of the most important functions of any strategic leader is to think and communicate ideas effectively. A leader must understand the basis of today's information systems and the relevance of technology to today's strategic environment.

The basic nature of most organizations is to resist change. Many have not yet recognized that the explosion of technology is forcing a tidal wave of change that is profoundly affecting both organizations and leaders. The national security environment is no exception, and may be feeling the effects of this change sooner than the rest of society as a whole.

Looking at the strategic environment in the information age, we recognize the information age flood of technology has made it possible to provide more complete, accurate, and timely information to the decision maker. Information technologies are being used more frequently as the cost of processing information improves. Many tasks are enhanced by application of computers, communications, and information management systems; yet, random unskilled application of these tools can lead to disaster for leaders and their organizations. Many senior leaders have not yet realized the full implication, both positive and negative, of the evolving technology in the global information age:

Even though some senior leaders initially feel this way, experience shows that when new information technologies are introduced, executives realize the systems indeed help with even the most difficult decision making tasks and issues. Today, computers and information systems are necessary to all aspects of the strategic environment and senior leader work.

INFORMATION PROCESSING

As the Army moved into the late1980s, a major technical report was released to the Chief of Staff of the Army. It was a long-term research program that studied information, and systems theory in large organizations. If you are interested in the detailed research results of the study, you can obtain the complete report (X=H 1979).

Like most leaders then and now the Army was searching for factors or sets of factors that make up the elusive shortfall between "what is" (where we actually are) and "what could be" (the potential of the organization, "Be all you can be").

But what was the factor or factors? They knew it had something to do with "organizational performance." They knew it was also based on how an organization was run, and how its processes were coordinated, integrated, and controlled. It was not just management, leadership, and organizational development. It was all of these factors and more.

They also knew X had to be related to the fact that the organization must work through people. X was the conceptual binder, the thing that provided the synergy, the thing that brought powerful notions together.

WHAT COULD BE (POTENTIAL)

|

X=?

|

WHAT IS! (ACTUAL)

The end result of all of their research and work was that the unknown factor was "H," and H was INFORMATION!! Information made the difference. It was nothing more than the concept of MATTER and ENERGY, ORGANIZED BY INFORMATION. The task is to increase the efficiency and effectiveness of how we use information in our organizations.

The X=H research was conducted by HUMRO over a five year period. It compared over 150 organizational events that clearly demonstrated a direct link between efficiency of information flow and the effectiveness of the organization. Some argued that differenceof information flow is no more than good leadership and that good leadership is nothing more than turning information into action. If this is true, then information management should answer the common sense notions of how to run an organization, as it is the conceptual binder pulling all of these ideas of leadership, organizational development, resource management, command and control and communications together.

However, information as we have described it so far seems to be a specific thing. Bits and bytes. Measure this and measure that. If the clear, precise, and factual cognitive dimension was the only one, then putting H to work to solve for X would be simple and we could use information management alone to get the job done. Consider the phrase:

"SON OF A BITCH"

There are two dimensions at work here. One dimension of this declaration is cognitive and one affective. This phrase used strictly from a cognitive dimension is a clear statement of fact about a hound dog. However, it probably triggered an affective dimension in you giving it a different meaning. The affective dimension is the one that carries feelings, sentiment, and emotion. It is this function of context, culture, and values; group norms, gestures, and expressions; as well as modulations of volume, rate and lag time that gives it meaning. Information is a function of both cognitive and affective dimensions.

How important is the affective dimension in the transfer of information? Research suggests that only about 7% of total meaning comes from words, inflection 38%, gesture and expression about 55%. Since information must flow through people there is always an affective dimension. If we choose to ignore the affective dimension and look at only the cognitive flow of information, solving for X answer is easy. However, one of the most important findings of the research was that the "greatest" breakdown of organization performance was not the cognitive or technical dimension but rather the social and human (the affective dimension). The human dimension is certainly important to the leader for planning and transferring information in the organization. This approach to understanding information processing begins to clarify the important differences between just employing data and information, versus skillful information management.

Amid an ever-expanding availability of information at every level of management, the leader is faced with the responsibility of managing information while providing valuable data to the organization. General Colin Powell, while Chairman of the Joint Chiefs of Staff, shared his thoughts about the important role of information management for strategic decision making.

At the height of the Persian Gulf Conflict, the automated message-processing network passed nearly two million packets of information per day through the gateways in Southwest Asian Theater of Operation. Efficient management of information increased the pace of combat operations, improved the decision making process, and synchronized various combat capabilities. The technology developed to support these networks proved to be a vital margin that saved lives and helped to achieve victory. (Joint Training for Information Managers, 1996)

Col Paul T. Haig discussed the transformation both minds and culture in his article in Parameters (1996). He believes that as technology transforms culture it will also transform the way people think. Information management and manipulation are replacing knowledge acquisition and inference. Experts are defined by their ability to recognize underlying patterns so that more accurate facts can be acquired. It is becoming more important to know what to ask for to avoid being overrun by a variety of answers.

Second, the basis for learning is changing. The battle began over "real world learning" versus the information age "virtual reality." The ability to "what if " learn from mistakes, and repeat the task by computer analysis over and over, has changed the way we learn.

Third, systemic decision making is taking over the use of intuition. If we are not careful technology also can cause paralysis through analysis and incline leaders to neglect intuitive skill commanders use as an important advantage in the often uncertain and ambiguous environment of the strategic leader. Possible over-reliance on automated and structured systems can stunt intellectural growth and limit executive effectiveness in unfamiliar environments.

NATIONAL SECURITY ENVIRONMENT

Admiral William A. Owens, former vice chairman of the Joint Chief of Staff, suggests that three simultaneous revolutions have pushed the national security community and, more specifically the military, toward major change. The first came from the revolution in world affairs brought about by the implosion of the Soviet Union and the end of the cold war. The second, a related revolution, was the reduction of the defense budget, accelerated because of the Soviet demise. The third, called the "revolution in military affairs" or the "revolution in security affairs" at the strategic level, happened in part because of the early investment in technology by the military. That investment has accounted for leveraging improvements in using military force more effectively. Owens suggests that the U.S. military will be the first to pass through the revolution in military affairs, and will emerge with great technological strengths. These strengths will provide an edge across the entire spectrum of contingencies against which the U.S. may need to commit its military forces. This U.S. technical revolution in military affairs is based on a "system of systems" approach and is broken into three major categories:

ALONG CAME THE INFORMATION AGE

What is it about the information environment that makes such an impact on the senior leader/executive environment? In order to better understand the implications of information age and where it may be going, we need to understand how it got here.

It seems that in the evolution process only occasionally has human thinking and intellect developed in historical proportions and quantum leaps. The links between various tools and human thought account for much of it. Dr. Douglas C. Engelbart, at the Stanford Research Institute, Augmenting Human Intellect Research Center, examines these relationships::

More than 20,000 years ago, humans developed spoken language abilities. This allowed them to pass knowledge along from generation to generation. Therefore, people were able to accumulate more knowledge than any one person could learn in a lifetime and allowed people to deal better with more complexity. But the amount of information that could be accumulated was bounded by the memory capacity of any given individual. The use of myths and ballads made memorization easier, but the limits of memory restricted the evolution of intellect. About 6,000 years ago, humans developed the ability to write- not only pictures that represent whole ideas, but also pictures that represented part of ideas. The next jump was in about 3100 BC, when the Sumerians began combining these pictures with phonetics to look like abstract ideas. These written sounds, represented a massive leap in human ability to express complex thoughts in writing. As a result, we were able to be more and more specific communicating complex, abstract ideas.

Writing continued to develop and soon began to match spoken language in its richness. This allowed us to save significantly more information than could be remembered in stories and songs, and in turn expanded our ability to deal with a complex world.

We all know that just over 500 years ago, Gutenberg developed the movable-type printing press, and widespread dissemination of information became possible. In combination with improved communications and trade, the printing press led to the spread of knowledge across social and political boundaries and put books in the hands of the masses. The general education level of the population increased, society could now focus studies on more advanced subjects.

Although technology continued to advance during the second wave industrial world, the birth of the computer and the computer chip has signaled the beginning of the "information age" and the quest for a new era of data, information and knowledge collection.

TOOLS FOR THINKING

The information age has recently begun to develop tools for leveraging, thinking, and decision making. Even though most information systems professionals are concentrating on automating routine transactions, a small group of information systems experts have pursued a different course.

Dr. Douglas Engelbart at Standford's center for Augmenting Human Intellect has begun to develop tools that were not designed to capture more keystrokes or process data into reports, but to help people think. His research led to the invention of many of the devices and tools now considered the leading edge of computing, including the mouse, windows, hypertext, and electronic publishing: all tools designed to leverage the individual's ability to think.

In the 1970s, the idea of enhancing human thought through computers wasn't a popular notion. People saw the computing world through an administrative lens. The environment changed some in the 1980s with the infusion of the PC into the home and business but it was still very much a word processor, or database tool understanding of technology. The view has changed some since the 80s but not dramatically. Many still connect computing with office administration. However, those who truly understand the potential of computers for thinking and communications are doing business differently. These visionaries are proving that improvements in our ability to work with information can lead to significant leaps in intellectual abilities and organizational productivity. Much like the findings of the X=H research, government and industry are leveraging their leaders and organizations with management techniques.

The information age has arrived globally. The Internet is growing by leaps and bounds, and President Clinton's current budget includes a $2 billion dollar technology initiative to connect every classroom, library, and hospital in the United States to the Internet by 2000.

INFORMATION PROCESSING, COGNITION, AND DECISION MAKING

Since senior leader and executive worth is measured by what they know and the success of the decisions they make, a look at how information technology can enhance cognitive capacity and decision making is imperative.

Using systems theory, we'll relate this process to a systems model you will learn in SLDM. (INPUT - PROCESS - OUTPUT) Thinking or cognition can be described as a process of gathering data and information (Input), sorting and relating it (Process), and creatively and critically viewing it to induce or deduce new ideas (Output). Don't forget feedback is an essential part of any system to grow and learn.

Computer and information systems work the same way. They are systems. Input devices bring information into the computer system. The input devices would be the keyboard, the scanner, or various types of drives. The processor (CPU - computer-processing unit) is the computer itself. The output (devices like the monitor/screen or printer) rounds out the system. All computer systems must have these components (like the human decision process) It is the speed and accuracy of the computer executing this process that has promoted its success.

INPUT ------> PROCESS -------> OUTPUT

<-------- FEEDBACK <----------

Like the computer, human processing of information is limited by the capacity of the machine. Human processing is biologically limited by two major factors: First, the capacity of long-term memory (a constraint of how much information we can accumulate without the help of aids such as writing), and second, short-term memory (how long we retain information). The mind is like a mental "scratch pad" that can hold only a limited number (usually 7 to 12 clusters) of thoughts at a time. (And you thought the "chunking" of telephone numbers or the clustering of the SSNs was just an accident.) These constraints of our memory can limit our ability to distill, relate, and view ideas. As we improve our ability to structure and organize symbols (such as language) outside our heads, we expand our ability to think. This ability to manipulate information has far reaching implications for advances in human cognition and decision making. With the help of information technology as a lever we are preparing for the next leap in the evolution of human cognition.

What can computing and information management offer the strategic leader?

As computers began to do more resource intensive processing of data, they allow time for people to process more complex issues and thoughts. And, as computers provide a higher knowledge and comprehension level of information, there also is more time for leaders to concentrate on senior level tasks requiring social interaction and complex information processing.

Computers have dramatically extended our memory capability, and memory and cognitive capacity are the two elements that form the basis of our thinking process. Computers are supplements to this process and, although they will not take the place of strategic leaders, they can become a powerful tool to help senior leaders become more efficient and effective. The correct use of information tools can certainly leverage strategic leadership and decision making when properly applied.

The only hope for successfully dealing with the complex "third wave" global environment is to outsmart it. Intelligence is the best bet for surviving in the complex strategic environment, therefore, leveraging intellect with technology is a must. Similarly, the organizations we construct can no longer depend on size to be successful. Today, small organizations tend to be as efficient and productive as large ones. Small organizations are inherently more flexible and better able to respond to the complex environment. Companies are quickly moving away from mass production toward specialty products, and custom military units like special operations units and cross-attached units for specific purposes are all part of the fast moving "third wave" world. Strategic leaders will encounter an environment that has less bureaucracy, smaller staffs and a faster moving and changing world to operate in.

In the information age, organizations must find ways of increasing intelligence and learning and use various systems of feedback loops to adjust the decision process of the organization. Computer information systems are ideally suited to assist with all phases of the decision making process: input, processing, output and enhancing the feedback of the system.

A primary question a leader must ask is: How do we make our organizations "smarter"? Part of that answer has to be: How do we make our leaders smarter? How do we build on the "Human Capital" that our leaders and experts in our organizations possess? Senior leaders' knowledge depends not only on the power of the leaders' mind, but on their ability to leverage that knowledge with proven tools and methods during the decision making process.

In this post-industrial era, the success of organizations seems to lie in human capital (HC) and systems capabilities of the organization rather than in actual physical assets. The capacity to manage human knowledge-and to convert it into useful products and services-is fast becoming the "critical" leader skill of the age. Despite the growing importance of expertise, few systematic answers to even basic questions are available:

ALTERNATIVE FUTURES?

The Air University's 2025 research team created a number of possible separate worlds for the future. The four most challenging, interesting, and difficult for the United States served as guides for their research. Two additional worlds--an intermediary world with selected characteristics of other worlds and a world that was a partial evolution to the future of 2025, Crossroads 2015--served as baselines for the 2025 analysis. The worlds that emerged follow. That a look at the proposed environments of the future, the unique opportunities and challenges in each world for the strategic leader.

Gulliver's Travels. This is a world of rampant nationalism, state and nonstate sponsored terrorism, and fluid coalitions. Territorialism, national sentiments, the proliferation of refugees, and authoritarian means flourish.

The United States is overwhelmed and preoccupied with such worldwide commitments as counterterrorism and counterproliferation efforts, humanitarian assistance, and peacekeeping operations. The United States is attempting to be the world's policeman, fireman, physician, social worker, financier, and mailman.

This situation forces the U.S. military to devise concepts of operation for meeting expanding requirements while maintaining a high operational tempo during a period of constrained budgets. The U.S. world view is global, the difference in rate of growth and proliferation of technology ( TeK) is constrained-evolutionary, not revolutionary-and the world power grid is dispersed.

Zaibatsu. In Zaibatsu, multinational corporations dominate international affairs and loosely cooperate in a syndicate to create a superficially benign world. Economic growth and profits are the dominant concerns.

While conflict occurs, it is usually through proxies and is short lived. Military forces serve more as "security guards" for multinational interests and property rights. Technology has grown exponentially and proliferated widely. Global power is concentrated in a few coalitions of multinational corporations.

The main challenge to the U.S. military in this world, which is becoming unstable due to rising income disparities, is to maintain relevance and competence in a relatively benign world where the United States is no longer dominant. The U.S. world view is limited as domestic concerns take precedence.

Digital Cacophony. This is the most technologically advanced world resulting in increased individual power but decreasing order and authority in a world characterized by fear and anxiety. Advances in computing power and sophistication, global databases, biotechnology and artificial organs, and virtual reality entertainment exist.

Electronic referenda have created pseudo-democracies, but nations and political allegiances have given way to a scramble for wealth amid explosive economic growth. Rapid proliferation of high technology and weapons of mass destruction provide individual independence but social isolation. The U.S. military must cope with a multitude of high technology threats, particularly in cyberspace. The U.S. worldview is global, technological change exponential, and the world power grid dispersed.

King Khan. This world contains a strategic surprise in the form of the creation of a Sino-colossus incorporating China, Taiwan, Malaysia, Singapore, and Hong Kong. U.S. dominance in this world has waned as it has been surpassed economically by this entity and suffered an economic depression. This has led to a rapidly falling defense budget and hard choices about which national priorities (core competencies) to maintain in a period of severe austerity.

The American Century has given way to the Asian Millennium and the power, prestige, and capability that were once American now reside on the other side of the Pacific Rim. The U.S. world view is decidedly domestic as it copes with problems at home, the growth in technology is constrained and world power is concentrated in a Chinese monolith whose economy, military, and political influence dwarfs those of the United States. The United States has come to resemble the United Kingdom after World War II-a superpower has-been.

Halves And Half Naughts. This is a world in which there are both changing social structures and changing security conditions. The main challenge to the military is to prepare for a multitude of threats in a world dominated by conflict between haves and have-nots. The world has split into two unequal camps: a small, wealthy, technologically advanced, politically stable minority of the states and peoples of the world (roughly 15%) and the poor, backward, sick, angry, unstable vast majority of the world's states with people who have little, and therefore have little to lose, in seeking redress of their grievances.

The U.S. world view is global but only because of the threats to its security represented by these masses. Technology and power are bifurcated exhibiting trends in both directions in the divided world.

Crossroads 2015. In Kurdish areas of Eurasia, the US uses programmed forces from 1996-2001 to fight a major conflict. The choices and outcomes made at this juncture have much to do with determining which of the worlds of 2025 will emerge a decade later. The American world view is global, TeK is constrained, and the world power grid is seen as concentrated but beginning to become dispersed. Potential future conflict centers on events involving disputes between the Ukraine and a resurgent Russia and the reaction of the rest of the world to such a conflict.

The United States in 2015 still has global commitments and concerns, but a constrained rate of economic and technological growth. Whether the US chooses a more isolationist path because of these pressures, or chooses a more activist role with the sacrifices that would require, is the major question to answer in shaping the world of 2025.

CONCLUSION

No one can predict where the information age will lead us. No one can reliably predict whether technology will ultimately enhance or impair the human dimension of senior leadership but one thing is sure-technology is here to stay. Either we master technology or technology will master us.

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