Navigating by Dead Reckoning

Over the years, I've sat through more strategy reviews than I can remember. Most were thoughtful, well prepared and intellectually rigorous. Looking back, I think many of them, including those I was part of, shared the same habit: we spent far more time measuring progress against the plan than asking whether the assumptions behind the plan were still true.

It took me years to realise this wasn't simply a management habit. It was a navigation problem.

Long before ships could determine longitude, sailors relied on a method called dead reckoning. Starting from their last known position, they estimated where they should now be based on speed, heading and time elapsed. It was logical, disciplined and, for long stretches, remarkably effective. Its weakness was subtle: every small error compounded into the next estimate. The longer a ship sailed without an external reference point, the more confidently it could be navigating from the wrong position.

That weakness became tragically clear in 1707, when four ships of the Royal Navy, commanded by Sir Cloudesley Shovell, struck the rocks off the Isles of Scilly after returning from the Atlantic. Somewhere between fifteen hundred and two thousand men drowned within sight of England. The fleet wasn't undone by poor seamanship or a lack of discipline. Quite the opposite. It was led by one of Britain's most experienced admirals. The problem was that the navigators believed they were safely west of danger, and nothing available to them could tell them otherwise.

That story stayed with me because it captures a pattern I've seen repeatedly in organisations. The tools have changed. The dynamics haven't.

Seven years later, Parliament created the Longitude Prize. I wrote in an earlier piece about the outsider who eventually won it. What I did not say is what the prize was really for. It was not for a better plan. Every ship already had an excellent plan. The prize was for a way to take a fix: a live correction against a reference point outside the ship.

Over the years I've realised that most organisations navigate much the same way. The thought didn't come from maritime history; rather through strategy reviews where every answer came from the previous version of the plan. I've spent much of my career trying to build the equivalent of better navigational instruments, which is probably why this analogy refuses to leave me.

The most familiar ritual in corporate life

Consider the quarterly forecast we all go through. A number is produced, which descends from the plan, adjusted by run rate, seasoned with judgement, formatted beautifully. Everyone in the room treats it with respect. And almost everyone in the room privately knows what it is: last known position, plus assumed speed, plus assumed heading. Dead reckoning in a spreadsheet.

I remember one steering committee where every chart showed green, every milestone had an explanation, and every discussion revolved around whether we were ahead or behind the plan. It struck me afterwards that nobody had asked a simpler question: are the assumptions behind this plan still true? We were measuring ourselves against our own projection.

The same is true of the 3-year strategy, the transformation roadmap, the annual plan. Well, I do not say this with contempt. In fact, these artefacts are necessary, and I have written more of them than I care to count. They are how large groups of people steer together, and steering together is genuinely hard. The problem isn't planning. It's what we choose to consult when checking whether the plan still reflects reality. In most organisations, the answer is the plan. Progress is measured as variance against our own projection. In effect, we compare the ship's log with...the ship's log.

You already own the counterexample, and it lives in your pocket. A printed road map is a plan: accurate on the day it was made, but soon becomes blind ever after. Your sat nav is something else entirely. It does not trust its own projection for more than a second. It takes a continuous fix against satellites, reference points that are outside the car, indifferent to where the driver believes the car to be. When you miss a turn, the map does not defend the route. It recalculates from where you actually are.

Nobody would navigate a city with confident projections from their last known position. But we continue to navigate billion dollar enterprises that way for years at a stretch.

Information, signal, and the thing worth steering by

Whenever I raise this idea, someone points to the dashboards, research subscriptions or market intelligence reports. It's a fair challenge. Modern organisations aren't short of information. They're drowning in it.

This is where a distinction matters, and the innovation conversation keeps collapsing it.

Information has become so abundant that scarcity is no longer its defining characteristic. Attention is. Most information never changes a decision.

A signal is rarer: a piece of the outside world that actually bears on your position. It could be in a competitor's quiet hiring pattern, or a regulation drafted in another jurisdiction. Perhaps it is in a technology crossing a cost threshold. Signals exist in the information flood, but they often arrive weak, ambiguous and inconveniently timed, and they drown easily in the noise of everything else.

Then there is a third category, and it is the rarest asset in any economy. A validated signal is one that has survived honest interrogation by people with different vantage points and no incentive to be polite about it. Not an analyst note or a headline. But critically speaking, a claim that has been in a room with sceptics from outside its own world and still come out standing. That's a signal - vetted and genuine enough to pursue.

Now this difference is not academic. I once sat with a leadership team that had planned around a comfortable assumption: a particular capability was five years away from being practical in their industry. It was in the strategy, priced into the roadmap, repeated in almost every deck. Then a session put them at a table with operators from an adjacent sector, and one of them said, without drama, that his business had deployed that capability the previous year. He described the vendor, the cost and the six months of pain. You could feel the room take a fix. The chart said one position but the apparent North Star said another. The room was sceptical at first. Questions followed. Which vendor? At what scale? What didn't work? Within half an hour the conversation had shifted from whether the capability was viable to why we'd assumed it wasn't. Nobody had discovered a new technology that afternoon. We'd simply discovered our map was out of date.

That is celestial navigation for enterprises. Plans help you steer. Validated signals tell you whether you're still where you think you are.

What this is not

Let me concede the obvious before it is raised. Plans still matter. Dead reckoning is how a ship steers between fixes, and no crew can take a fix every minute. The failure mode is not planning, it's sailing for years without a single correction from outside the hull, while the confidence of the chart grows and the accuracy of the chart decays.

Nor is this scenario planning wearing a new coat. Scenario planning is a fine discipline, but it imagines alternative futures from inside the same room, drawn by the same people, bounded by the same sky. A scenario is still your own projection. A fix is different in kind: it imports a reference point you did not generate and could not have generated, because it lives outside your vantage entirely.

And no, signals are not hindsight dressed up as foresight. The signals are almost always there in advance, dated and documented, held by someone. The question is whether anything in your operating rhythm ever puts that someone in your room.

Dead reckoning organisations

Once you have this lens, you start sorting organisations by it.

They're rarely poorly run organisations. In fact, many are exceptionally disciplined. That's precisely why the drift is hard to notice. Discipline can reinforce yesterday's assumptions just as effectively as it executes today's priorities.

Dead reckoning organisations are recognisable at a distance. Their calendars are full of reviews that compare the plan to the plan. Their external input arrives pre digested, through reports commissioned to reassure. Their forecasts are precise to the decimal and wrong by the mile. They are frequently excellent, disciplined and confident, exactly as Shovell's fleet was, and their position error is compounding in silence because nothing they consult exists outside their own hull.

Organisations that take fixes look different in small ways. Someone in them is paid to notice weak signals rather than to summarise strong ones. Outsiders with no reason for politeness get regular access to the actual assumptions, not the investor version. When an external reference point (and hence an emphasis on genuine partners) contradicts the chart, the instinct is to replot the position rather than to defend the projection. Their plans are humbler documents, revised more often, trusted more appropriately.

The gap between the two has always existed. What has changed is the cost of it. In slow seas, a dead reckoning organisation could drift for a decade and correct at leisure. The seas are not slow now. In my experience, the issue isn't that organisations review strategy too infrequently. It's that they rarely expose the underlying assumptions to people outside the organisation who have permission to challenge them.

The instruments for taking fixes exist, just as the marine chronometer eventually did. Most of them are not technologies. They are arrangements of people: deliberately mixed rooms, protected candour, outsiders granted access to real assumptions. Building those arrangements is unglamorous work, which is perhaps why so few organisations have anyone whose job it is.

So here is the question I would put to any leadership team, and I ask it of myself as much as anyone.

When did your organisation last take a genuine fix? Not a forecast review. Not a variance report. A moment when a reference point from outside your hull corrected your position, and the chart was redrawn because of it.

If you can name the moment, you'll probably remember what changed afterwards. If you can't, it may be worth asking whether your organisation has been navigating by projection for longer than anyone realises.