The importance of long-term thinking for businesses

The climate crisis and technological innovation are changing the way we work at a faster rate than we’ve ever seen before, and quick solutions just won’t cut it. Though it may seem easier to prioritise short-term gain, any business leaders wanting to future-proof their organisation need to look at their strategies through a long-term lens, too.

Why do we have a bias towards the short term? 

The organisations we work in often require short-term thinking to keep running year after year – daily problem-solving, quarterly budgets, and monthly goals all come to mind. We tend to have a strong bias towards short-term tasks because the reward comes more quickly.

Author Roman Krznaric refers to this tendency towards instant gratification as our ‘marshmallow brains’. The term comes from the Stanford marshmallow experiment, a study that measured children’s ability to delay gratification when left alone in a room with a single marshmallow. Predictably, very few could resist the marshmallow, but those that did were found to have better life outcomes later down the line.

We’re all guilty of having a ‘marshmallow brain’ and caving in to short-term gratification, even when we know long-term strategies may bring better results. So why is it so hard to resist this gratification?

“There have always been barriers to long-term thinking because there is a perennial push and pull between short-term results – which are easy to track, measure and evaluate – and long-term initiatives,” says Dorie Clark, bestselling author, business strategy coach, and Top 50 Business Thinker. Long-term goals can feel out of reach and hard to measure – this shouldn’t mean that we don’t strive for them, though.

The negative impact of short-termism 

According to Sophie Howe, business consultant at Sophie Howe Associates, “The biggest challenge for organisations and the people within them is finding the headspace to think long term. It’s a self-perpetuating cycle because many of the challenges that have created the polycrisis we're currently in are because of a lack of long-term thinking. We need to find ways of breaking that cycle.”

We know that short-term business mindsets limit economic success. The UK is currently underperforming when it comes to productivity, and this can be traced back to a lack of long-term thinking following the 2008 financial crisis. LSE’s 2023 study showed that the effects of short-termism after the crisis are still hurting us now. Failure to invest in technology, infrastructure and skills back in 2008 has meant that productivity in the UK is now 24% lower than it should be, based on the pre-crisis trend.

It's clear to see that short-term thinking cannot answer all the challenges we face. Now that we’re halfway to 2050, it’s time to look to the future and embrace a long-term perspective.

Benefits of long-term thinking

When you implement long-term strategies in your organisation, you’ll be more resilient, giving you a competitive advantage in an ever-changing business landscape. This is key for sustainable growth and success.

“A long-term lens is essential to create more stable, high-performing organisations now and in the future,” says our CEO Anton Roe. “This approach isn’t just for our business: it shapes the products we create for our customers and the impact we strive to deliver for them.” Having long-term plans in place will also improve your ability to anticipate risk or future disruptions, meaning you’ll be better equipped to tackle challenges down the line.

How to implement a long-term mindset in your organisation

If you want to foster a culture of long-term thinking in your organisation, you’ll need to incentivise it and reward it just as much as short-term success.

Clark notes that the most common trait in business leaders who implement long-term strategies successfully is the ability to be patient and resist instant gratification. When senior leaders adopt long-term mindsets and strategies, you’ll start to see this mindset filter down through your organisation. It’s important that every employee is on the same page, working towards the same goals for the future.

Final thoughts 

Long-term thinking will make your organisation more resilient in the face of disruption and better able to navigate changes to the world of work. The biggest challenge isn’t necessarily thinking in the long term, it’s taking on a dual mindset that addresses daily demands and future possibilities equally. Achieving this balance will unlock new opportunities for both individual employees and entire organisations.

This is a shortened version of an article produced by and published on Telegraph.co.uk – read the full article here.

The world of work is changing, and business leaders need to learn to adapt. To embrace a long-term mindset of your own, register now for our World of Work 2050 webinar series. 

Each month we’ll be joined by industry experts like Tom Cheesewright to discuss how the world of work will change over the next 25 years, giving you the insights you’ll need to stay ahead of the curve.