According to renowned television producer and writer Norman Lear, short-term thinking, or the inability to think any further ahead than the here and now, is a ‘societal disease’, an obsession that has no bearing upon a company’s success or even its present. While his comments were made some time ago, his observation is no less correct today, with business after business blinded by commerce and immediate profits, and incapable of planning for the long-term. In addition, having enduring goals has always been seen as a somewhat risky and unobtainable business model. Businesses must get out of this mindset and into the future if they hope to succeed. The long view is a business concept that can significantly affect the way businesses think about themselves and their future – why think small, when businesses can be thinking big, and towards the long-term?
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A brief guide to the long view: what is it, and why is it imperative in business?
In business terms, taking the long view refers to venturing down the road to sustainability. It’s a concept that reminds business owners to think about the effects that their actions will have on the future rather than the present, and to create a brand with its long-term potential in mind, rather than always aiming for the quick sale or easy profits. The long view is all of those rewards that can be garnered along the way, and a way for businesses to achieve long-lasting success, rather than burning themselves out for trinkets and prizes in the meantime. It also refers to reinvention, and to recognizing what does and doesn’t work. The long view is a means to restructuring failing business models and to embrace new opportunities – in short, it is a way of considering a business in terms of its future, not its present. Every business has the prerogative to change if it’s in the best interests of the future, after all.
There is, of course, an equal share of pros and cons to taking the long view, and not every business will immediately see it as an advantage. The world of business is always changing and it can be incredibly difficult to think that far ahead, or to ignore opportunities in favor of those that will be most beneficial later on.
The long view is best explained and demonstrated by Ken Fisher, the founder of Fisher Investments, which was established in 1979. Fisher asks: “What is the most common investor mistake? Trading: getting in and out at all the wrong times for all the wrong reasons.” Having taken his time to perfect his own business model, Ken was frustrated by the number of fellow investors and entrepreneurs that were too focused on achieving success in the short-term. He argues that taking the long view is important for success, and whatever the type of business or financial transaction, more people should take their time with decisions and stick with them, rather than fluttering between business models. Such models can always be reinvented, after all.
An innovator in investment strategy, Ken slowly built his business upon his theories and the strategies he devised over time. Since 1979, Fisher Investments has continued to expand, reinvent, and ultimately, take the long view. Now personally worth $3 billion+, it would seem that Ken does know a thing or two about successful business models and the time they take to cultivate.
Success stories and studies: the long view in action
It can be difficult for businesses to take the long view at face value, or to understand what its concept really means for them. It is therefore always worth them looking towards those who are currently implementing the long view, and identifying their triumphs in business:
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Pascale Witz says: “You don’t go to the national championships if you haven’t qualified first. Having a long-term vision and a long-term goal is important for motivating people and that actually energizes them on a day-to-day basis.” Having had experience of working in France, the US and the UK, Pascale has seen a variety of business models in play. Listed as one of the Top 20 Most Powerful Women in EMEA by Fortune, and now involved with a company boasting a €6billion portfolio, there can be little doubt that Pascale knows what she’s talking about – and little point ignoring the success of the long view as demonstrated by her tenacity.
Japan M&A acquirers: Those working in such an industry not only create and follow their own business model, but are aware of the trends around them. They’re able to base their actions on what other companies are investing in, and how quickly they make such decisions. Akin to a waiting game, this profession is disciplined and involves studying markets and watching other companies as they make often-rash decisions; the price they pay is never as important as their plans for the long-term. In this respect, taking the long view is not just about planning for the future, but also making allowances for it.
Ken Fisher once said: “Buying only what you know can end in disaster.” Directly answering Peter Lynch’s statement that businesses should stick to what they do best, his retort tells businesses that they must look beyond their own horizons in search of diversification and reinvention, or always be stuck in the past. Having taken his time to strategize and create a business model that best suited him, Ken is now listed among the 250 wealthiest people in America – a surefire indication that taking the long view works when it is applied properly.
Applying the long view to business models
Taking the long view is all about reformation and applying a little foresight to a company’s current business model, rather than starting again from scratch. These are tips for those fed up with living in the here and now, and who are keen to expand into the future – and even beyond:
Business should be approached as a marathon, rather than a sprint. It’s not a race to be the first to make profit, but a journey that should be carefully planned so that there is always enough momentum to keep going. Owners and managers, therefore, should adapt their business models to assume a steady pace, never dwelling too long on short-term objectives – the world of business is ever changing, after all. In addition, the training for a marathon takes months, and even years, to complete. The long view is all about planning and preparation, rather than immediate action.
Companies need to assess their assets and analyze strengths and weaknesses, and work out how each of these is likely to be a help or hindrance in the future. Now is the time to assess a business’s goals, thinking about what they are and what action should be undertaken to achieve them. The long view is about adapting business models to achieve such goals, constantly working towards them rather than dwelling on the present.
- The long view involves everyone, from owners, managers and stakeholders, down to the workforce; it cannot be achieved unless every department and individual is on board. Adopting the long view is not a means to steamroller everyone within the business to think the same, but to encourage a new means by which to do business – it should motivate and inspire, rather than control the meek few.
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This list of tips is by no means extensive, but it’s important for businesses to recognize that taking the long view is very much a personal journey for every company. It must be adapted to each business model in order to be effective, and its very mention merely serves as a guide for the ways in which businesses should be conducting themselves. The long view is a company’s opportunity to look forwards rather than back, to prepare for every eventuality and to create a list of goals that they can strive to fulfill over time, rather than a collection of short-term goals that gather incredible pressure. Even now, too many businesses are conducted in the short-term; it’s time to think a little further ahead.