In advance of our third child arriving in June (be on the lookout for a guest RKCA Insights writer that month), my wife and I are “glamping” in southeastern Ohio. As I write this from the porch of our cabin with a fire going, I’m both wondering why I brought my laptop and also reflecting on the recent miles we put in hiking. We’ve been fortunate between some hail and rain (in April) to get miles in on the adjoining hiking trails. For my wife and I our shared goal on these hikes has been to get time out in the fresh air and to disconnect from the busyness of life. It’s also provided me time to reflect on our business at RKCA, and The 20 Mile March.
The 20 Mile March
The 20 Mile March is a concept developed in the book Great by Choice by Jim Collins. Through his research when writing the book, Collins studied businesses that went through turbulent times and what made them successful. One recurring theme in his research was later called The 20 Mile March. This theme centered around businesses that self-imposed a rigorous performance mark to hit consistently. The argument being that by having a performance mark to hit, it imposed discipline and focus amid the chaos of running an organization.
Now if you think about it, think of it as like walking across the United States (or hiking trails in Adams County), and you’ve got two approaches:
- One is every day I’m going to get up and do 20 miles, no matter what. Good conditions, bad conditions, wind in my face, hot, cold, whatever is in front of me I’m going to march forward.
- And the other is, well….depending upon the conditions, I’ll either do big days or hide in my tent and wait for conditions to improve. I’m not on The 20 Mile March, I’m erratic based upon the conditions around me.
And what Collins found is that the more turbulent the environment, the greater the results accrued to those companies that have a 20 Mile March and stay consecutively with consistency on their 20 Mile March.
The Key is Consecutive
Both within our nine portfolio companies and during our sell side engagements, we look to understand a business’ 20 Mile March through our T20MM Evaluation. It’s my opinion that a successful 20 Mile March isn’t necessarily about a growth rate and hitting it every single year, although it’s easy to read this and get trapped up on the idea that this is just about compounding growth. It could be: we’ll be profitable every year, no matter what, as Southwest Airlines had for 40 years.
It’s my opinion that the key to The 20 Mile March is the word consecutive. Going back to Southwest Airlines, imagine you were there in the 1970s and the organization had a March where they stated “We have a March where we want to be profitable every single year for 40 consecutive years, without a miss.” All right. Now how would that impact your decision-making? Suppose your decision is that you must hit something for 20 consecutive years without a miss. Well, that means that if you don’t make your investments or think about new things you have to be doing in the future today, you might maximize your short-term results today, but you’re going to miss at 7 or 10 years in the future. It is my opinion that the very commitment to say that we’re not going to miss, ever, forces you to be doing all sorts of things today that change your timeframe and put you ahead of disruptions.
It’s my opinion that the great irony is that the short-term focus of “We can’t miss today, but we can’t miss any for the next 20 years, 30 years, 40 years,” means that you have to be constantly investing for down the road, or else you’re going to miss somewhere down the road (hiking trail).
If you’re interested in having your business’ 20 Mile March evaluated through our T20MM Evaluation, email me: email@example.com.
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