Here’s the link to my February 2017 column on Defence Leadership in

 

Here’s the link to my April 2017 column on Defence Leadership in

 

Here’s the link to my June 2017 column on Defence Leadership in

 

Here’s the link to my July 2017 column on Defence Leadership in

 

Strategic Readiness Bulletin Number 3 – 16 October 2017

Are We Entering a Post-NAFTA World?

By Richard Martin, founder and president, Alcera Consulting Inc.

Richard Martin issues Strategic Readiness Bulletins on an as needed basis to clients, key decision-makers, and other influencers, to highlight recent or evolving risks, threats, and opportunities for companies and organizations resulting from chaotic change as well as international and national situations of a political, economic, technological, or social nature.

The Strategic Readiness Issue

© Michał Barański | 123RF Stock Photo

With the current NAFTA negotiations underway it’s hard to tell yet whether they will be a net positive or a net negative for companies doing business across the Canada-US and Mexico-US borders.

My aim isn’t to assess the probabilities either way at this stage, but rather to highlight the need for prudent risk management and contingency planning to address various post-NAFTA—or “new” NAFTA—trade arrangements between Canada and its most important trading partner, specifically the US.

The diagram on the right below summarizes the strategies for risk and threat management. When we work to lower or eliminate the probability of occurrence of a risk/threat, then we’re in the realm of PREVENTION. However, if prevention fails, we still must have measures and plans in place to contain its most damaging consequences. This is where MITIGATION comes into play.

© Alcera Consulting Inc.

Businesses with NAFTA exposure must be aware of the risks and threats arising from potential changes to the trade agreement. This is prudent and may even lead to the identification of unique opportunities whether Canada-US trade relations continue much as before or change in a significant way.

Who Can Be Affected?

  • Manufacturers and other businesses that depend on imports and exports
  • Transportation and logistics companies with cross-border operations
  • Federal, provincial, and local government agencies and departments
  • Ports and border-crossing facilities
  • Tourist and travel related businesses
  • Sectors that are highly sensitive to changes in tariffs or trade restrictions

Assessing Your Situation

If you haven’t already done so, it’s time to consider the probabilities and potential impacts of the risks and threats your company faces if there is a change in the trading regime under NAFTA, or even just between Canada and US. This isn’t alarmist, it’s common sense and prudent leadership.

I can help you, but you can get a head start by considering the following questions.

  • What is your current dependence on imports and/or exports to the US (in terms of total revenue, volume, profits)?
  • What business lines or activities are in areas of HIGH POLITICAL SENSITIVITY (soft wood lumber, auto manufacturing, aerospace, etc.)?
  • Can you “immunize” to a certain extent against disruptive changes by diversifying your clientele or supplier relationships?
  • How sensitive are your prices and costs to small changes in trade restrictions and decisions?
  • Have you developed contingency plans for supply, transport, or logistics?

About Richard Martin

Feel free to contact me to discuss this and related strategic issues.

Richard Martin is an expert in identifying, assessing, and preparing for strategic risks, threats, … AND opportunities, so companies and organizations can exploit change, instead of passively reacting or succumbing to it.

Richard.Martin@alcera.ca

www.alcera.ca

www.exploitingchange.com

www.facebook.com/exploitingchange

(514) 453-3993

Previous Strategic Readiness Bulletins

The North Korean Nuclear Threat

Is Canada Facing an Incipient Refugee Crisis?

by Richard Martin

I facilitated a business continuity planning meeting last week with one of my clients, a mid-sized life insurance company. One of our objectives was to examine scenarios with business continuity impacts.

Upon consideration, it was apparent that several departments in the company had already encountered similar situations and developed informal processes and procedures to deal with them. However, it was also apparent that much of this valuable experience was dormant within these groups, and there was no ready way to extract the knowledge and share it throughout the company.

© faithie | 123RF Stock Photo

Such information is typical of what I call “unknown knowns.” This is knowledge that exists somewhere in the organization, usually informally and in the experiences of individuals or small teams, but that remains unknown by senior management and the wider organization. I developed this idea as a result of extending former US Defense Secretary Donald Rumsfeld’s musing about known knowns, known unknowns, and unknown unknowns.

If you build a two-by-two matrix you end up with a fourth quadrant, the unknown knowns. This is potentially highly valuable knowledge that is partially dormant and inaccessible to the whole organization. It can be useful for readiness, risk management, and business continuity preparation. But even more, there can be a treasure trove of client information, competitive intelligence, and operational know how that goes unexploited and unimproved, simply because there are no active means of accessing it and sharing it, much less improving it and exploiting it in a systematic manner.

As a military leader commanding peacekeeping forces, I found that the best information was often resident right within my unit. I had only to ask my troops what they had seen in their patrols and by talking with the local populace and I could generate enormous quantities of grassroots intelligence. That’s why military commanders prize ground truth so much.

There is a lot of knowledge and information resident in the minds of employees and managers in a company. There are salespeople visiting customers and prospects. Others are constantly interacting with suppliers, distributors, retailers, and even competitors. There is a lot of knowledge that goes unexploited simply because company leaders are unaware of everything that is known within their respective organizations.

Are there things you or your organization/team may know, but that you are not already aware of? What can you do to find out, or to promote this kind of sharing and awareness?

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.

 

by Richard Martin

Copyright: faithie | 123RF Stock Photo

There are an infinite number of ways to be wrong, but only one way to be right. Trial and error is the process of evolution, science, business and innovation. We produce many more “errors” than “successes,” so we must continually experiment with new ways of doing things.

Readiness is the product of this trial and error process. If we continually are working to improve our understanding of our surroundings and what will work to get us to our goals, then we can’t help but adapt to the constantly changing conditions by mitigating threats, and exploiting gaps and opportunities.

I like to think I’m in illustrious company, as shown by this sampling of aphorisms and quotes. I’m particularly fond of the approach of the great philosopher Karl Popper.

“Experience is the name everyone gives to their mistakes.” Oscar Wilde

“What is today called ‘negative feed back’ is only an application of the general method of learning from our mistakes-the method of trial and error.” Karl Popper

“The first principle is that you must not fool yourself-and you are the easiest person to fool.” Richard Feynman

“Reality is that which, when you stop believing in it, doesn’t go away.” Philip K. Dick

“Our whole problem is to make the mistakes as fast as possible…” John A. Wheeler

“Criticism of our conjectures is of decisive importance: by bringing out our mistakes it makes us understand the difficulties of the problem which we are trying to solve.” Karl Popper

“All our knowledge grows only through the correcting of our mistakes.” Karl Popper

“The more we learn about the world, and the deeper our learning, the more conscious, specific, and articulate will be our knowledge of what we do not know, our knowledge of our ignorance. For this, indeed, is the main source of our ignorance – the fact that our knowledge can be only finite, while our ignorance must necessarily be infinite.” Karl Popper

© 2017 Alcera Consulting Inc. This article may be used for non-commercial use with proper attribution.