Organizational Grit (#89)
From 2001 to 2014 the McKinsey Institute studied companies that focused on short-term goals and those that focused on long-term goals. Interestingly, the revenue of long-term firms cumulatively grew on average 47 percent more than the revenue of the short-term focused firms. In addition, the earnings of long-term firms also grew 36 percent more than the short-term firms. So, if long-term firms perform better, why don’t all companies focus on the long-term? One of the factors that the long-term organizations possessed was organizational grit. The short-term firms didn’t have it or didn’t have as much of it.
Organizational grit is present in sports, the military, non-profits, businesses, and at the strategic level. Although all groups desire it, some have it and some don’t. Here are five examples of gritty organizations.
Organizational Grit in Sports
In sports, there are thousands of stories of teams that have more organizational grit than talent and are able to beat better teams. The 1980 US Olympic Hockey Team that won the Gold Medal at the Lake Placid Winter Olympics is renowned for its grit. Coach Herb Brooks brought together young college hockey players with drive and desire. Relentlessly, he forged an elite hockey team that was superbly conditioned, passed well, checked aggressively, and had a fantastic goalie, Jim Craig. The exceptionally tough workouts Brooks put the team through created trust in the team. Together this forged organizational grit and enabled the team to beat the more talented Soviet hockey team. This team is featured in the 2004 movie Miracle.
The 1990-1994 Buffalo Bills are another exceptionally gritty team. Coach Marv Levy forged a gritty team behind quarterback Jim Kelley that was able to make it to the Super Bowl four years in a row. The Bills, unfortunately, lost all four Super Bowls. Think about the grit required every year after losing the Super Bowl to get back to the biggest game in professional football? Levy was a master at motivating the team as well as getting the team to embrace the no-huddle offense.
Finally, the 1997-1998 Chicago Bulls won their sixth NBA championship by combining all five elements of organizational grit. The ability of Coach Phil Jackson to create the right culture that enabled the egos of the starting five to work well together, as well as leverage Michael Jordan’s competitiveness and grit was amazing. If you’d like to see it for yourself, the Bulls grit was on full display in the ESPN/Netflix mini-series The Last Dance.
Organizational Grit in Business
Corporate-wise, a gritty company is the Lego Group, a privately held Danish Company. As many of you know, the Lego Group has been making interlocking plastic toy bricks since 1949. Yet, in 2003 the company was in trouble – losing money and $800M in debt. In 2004 Vig Knudstorp, a 36-year-old former consultant from McKinsey, was brought in to turn it around. Vig did it by providing purpose (inspire and develop the builders of tomorrow), a strategy, and rebuilding the company, brick by brick. The strategy dumped things Lego had no expertise in, slashed inventory, reconnected with fans, and finally entered the girl’s market. In short, he infused organizational grit into Lego. The results speak for themselves -- in 2015, the privately owned company overtook Ferrari to become the world’s most powerful brand with a profit of $886M.
Strategic Grit
Prime Minister Winston Churchill was a man of action – as a cavalry officer in three colonial wars, Battalion Commander on the Western Front in World War I, writer of 40 books, recipient of the Nobel Prize for literature, painter, reporter, airplane pilot, farmer, bricklayer, and a Member of Parliament. He served in a variety of positions in the government: Colonial Under-Secretary and Secretary, President of the Board of Trade, Home Secretary, First Lord of the Admiralty twice, Minister of Munitions, Chancellor of the Exchequer, and Prime Minister twice. More importantly he was a gritty leader—of small military units as an officer, of his party in Parliament, of his departments in the executive branch of the British government, and of the country as Prime Minister.
During the dark days of 1940, Prime Minister Churchill provided the British people with purpose and grit at the strategic level when the odds seemed stacked against them. On May 13, 1940 to a packed House of Commons, in the “Blood, Toil, Tears, and Sweat” speech, Churchill gave one of the world’s greatest purpose statements:
You ask, what is our policy? I can say: It is to wage war, by sea, land, and air, with all our might and with all the strength that God can give us; to wage war against a monstrous tyranny, never surpassed in the dark, lamentable catalogue of human crime. That is our policy. You ask, what is our aim? I can answer in one word: It is victory, victory at all costs, victory in spite of all terror, victory, however long and hard the road may be; for without victory, there is no survival. Let that be realized; no survival for the British Empire, no survival for all that the British Empire has stood for, no survival for the urge and impulse of the ages, that mankind will move forward towards its goal.
This speech provided a goal, a purpose, alignment, organizational grit, and resilience for the British people and government against Nazi Germany. Even Churchill acknowledged the impact, saying “The nation…had the lion’s heart. I had the luck to be called upon to give the roar.” The British used their organizational grit to help turn the tide and defeat the Axis Powers in World War II.
Organizational Grit
Personal grit is “the will to persevere to achieve long term goals.” A person’s grit is built upon a goal, their perseverance, their resilience to deal with setbacks, their courage to deal with the fear of failure, and their drive. While groups are a collection of people, organizational grit is different than just the sum of each member of the group’s individual’s grit. Gritty people do help to form gritty organizations. But organizational grit is more – it is “the group’s will to persevere to achieve long term goals.”
After looking at sports teams, the formations I was part of in the Army, corporate examples, and strategic examples I have been able to develop a theory on the formation of organizational grit. I find that organizational grit is forged through:
Providing the team a goal and a purpose
Providing the team a plan of how to get there
Providing the team a scoreboard that tracks the progress
Modeling and growing an organizational culture that values daily small wins (“every day a little better”), self-discipline, and resiliency.
Developing trust in the team that is grown through shared experiences and hardships
There are seven articles coming in February and March that will dig into each facet or organizational grit – purpose, planning, culture, and team building. Combined, they will help you enhance your team’s grit. Go on the offensive in 2021 and enhance your organizational grit by providing the team a goal and a purpose, a plan, a scoreboard, a gritty culture, and building trust in the team.