Leading vs. Lagging Indicators

Discovering Insights at the Edges

In this episode, Rich Horwath sits down with Dr. Rita McGrath, Columbia Business School professor and one of the world’s foremost experts on strategy and innovation. Known for her books including, Discovery-Driven Growth, The End of Competitive Advantage and Seeing Around Corners, Dr. McGrath reveals how leaders can identify the early signals of change and shape organizations that thrive through disruption.

From checkpoint-based planning to the power of systematic disengagement, Rita explains how today’s most successful leaders move beyond rigid planning and instead experiment, learn, and adapt. She explores the value of leading indicators, resource reconfiguration, and discovering opportunity in emerging “arenas” rather than static industries.

Together, Rich and Rita discuss why true strategic clarity demands courage—the willingness to stop doing what no longer serves and the foresight to invest in what could be.

🔑 Key Quotes:

“My friend Sharon Price-John, who happens to be the CEO of Build-A-Bear Workshop, has a great way of framing this. She said, stop doing stupid stuff.”

“And what an inflection point does is it changes that envelope of possibilities. So now you can do things you never could before.”

“And if you think about things like a mission, Patagonia would come to mind as a firm that’s centered on that. So I think the first choice you need to make is—what are we sort of centering ourselves on?”

“And if you don’t invest in creating the conditions for those future choices, you just won’t have those choices to make.”

“A leading indicator is giving you some clues about what could be—not necessarily will be—but what could be in the future.”

“And I think strategy is really critical, because how else are you going to have the clarity to say, yes, I’m doing this and not that?”

🏆 Winsights: 

This week’s Winsight comes from Reed Hastings, CEO of Netflix, who reminds us: “If you are not genuinely pained by the risk involved in your strategic choices, then it’s not much of a strategy.”

Real strategy requires trade-offs. It’s not about doing everything—it’s about deciding what matters most, and having the discipline to say no to what doesn’t. Great leaders make those choices consciously, knowing that clarity comes with discomfort.

As Hastings suggests, the anxiety we feel when we commit to one path and close off others is the signal that strategy is working. If every decision feels easy, we’re not being strategic—we’re just being busy. This week, reflect on the trade-offs you and your team are making. If you feel that tension, you’re likely heading in the right direction.

🔗 Links:

Connect with Rita Mcgrath:

 

Website: ritamcgrath.com
LinkedIn: Rita McGrath on LinkedIn

Books:

Seeing Around Corners: How to Spot Inflection Points in Business Before They Happen – Amazon Link

The End of Competitive Advantage: How to Keep Your Strategy Moving as Fast as Your Business — Amazon link

Discovery-Driven Growth--Amazon Link

The Entrepreneurial Mindset: Strategies for Continuously Creating Opportunity in an Age of Uncertainty — Amazon Link

🚀 Resources from Rich Horwath, Host of Strategic Minds:

🌐 Strategic Thinking Institute Website
👤 Rich Horwath on LinkedIn
🎥 Rich Horwath on YouTube
🐦 Rich Horwath on X
📸 Rich Horwath on Instagram
📘 STRATEGIC Book
🧠 Strategic Fitness System
📬 Free Strategic Thinker Newsletter
🧪 Strategic Quotient (SQ) Assessment
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