Short-term thinking is a disease that has infiltrated politics, but it is rife in the business world too. Miriam Lyons from the Centre for Policy Development says this short-termism is driven by a shortened feedback loop, not helped by the rise of social media.
Ian Woolcott from Woolcott Research says we’re also in the age of the opinion poll. Rather than basing our decisions on carefully orchestrated research programs, today many of us are running quick-fix DIY-style research, often using free tools like Survey Monkey. Could the result be that we’re fuelling our quest for short-term solutions with inaccurate information?
So, how do we stop this short-term thinking? Kerry Newton from Directors Australia says it’s the job of a board to take a more strategic view. Even if your company isn’t required to have a governing board, maybe it’s an option, so there is someone there to pull you out of the nitty-gritty of day-to-day operations.
For larger businesses there’s also the question of how the senior management team is rewarded. Michael Robinson from Guerdon Associates says its not uncommon for senior executives to be paid for the upside and not penalised for the downside. That can drive dangerous behaviour, where the long-term growth of the company is compromised for short-term gain. The solution might be deferred bonuses, that ensure that targets are not only met but also maintained.
All that, plus a large sign saying “Don’t Panic” on your office wall!