Help Leaders Be Less Useless at Strategy

By Roger Martin

At some point in the formulation of a strategy, its creator must review his or her work with the leader, either by choice or by procedure.

If the strategist is a CEO, the reviewer is the board (or a committee thereof). If the strategist is a business unit head, the reviewer is the CEO, and so on down the organization. Regardless of the specific players, the process looks much the same; typically, we wait, and wait, and wait until the strategy feels iron tight. Once it is ready, we go in to the meeting with a perfect slide deck and lots of points in defense of our view.

The goal is to get a big gold star for having produced a wonderful, perfect strategy. Anything less is a disappointment. The creator and the reviewer both know that this is the desired outcome — and they know that the other knows it too. Hence, the creator presents as if everything in the strategy is obviously and unassailably true. And the reviewer most of the time provides the gold star or offers minimal and easily incorporated feedback on small aspects of the strategy. He or she knows that if any criticism is levied or shortcoming pointed out, the creator will be dismayed, if not entirely disillusioned.

This approach to strategy review has the unfortunate effect of rendering the leader in the review position almost useless. If they give the gold star, they have added absolutely nothing of substance to the strategy. And, even if they offer reservations and feedback, the timing of the conversations renders those all but useless too. As W. Edwards Deming taught the production world, inspecting outputs at the end of the production line is the most ineffective way to improve quality.

If these leaders are in their positions legitimately (and if they are not you have a much bigger problem), then strategists should want to use the leader’s judgment and experience to the maximum to improve the strategy. That means going to the leader early and often. Don’t want until your strategy is so polished that you don’t want anything more than a pat on the back. Instead, construct a more productive series of interactions on strategy:

• Go early with the framing of the strategy challenge that you want to tackle. Ask your leader whether there is a different way he or she would frame the challenge that you should be working on.
• Go back with the possibilities you generate. Ask your leader whether there might be different possibilities he or she would consider or ones on your list that he/she sees as unacceptable on their face.
• Return a third time when you have reverse-engineered the possibilities to determine what you believe would have to be true and have identified which of those things that you feel are least likely to hold true. Ask the leader whether there are additional conditions that would have to hold true and about which are they most skeptical.

If you do these things, three great things will happen:

1. You will get insights along the way that will shape and improve the way you are thinking about the problem at hand;
2. You won’t be sent back for time-consuming and expensive rework at the end of the process;
3. You will have a leader who is enthusiastic about the outcome because he or she genuinely helped to shape it.

How To Make Sure Strategy Doesn’t Kill Your Business

By John R. Childress

Strategies are meant to carry companies onwards and upwards to lofty performance and competitive advantage. Sadly, in the majority of firms, big and small, strategies are rarely delivered and often die a silent death on a dusty shelf in the corner office, along with failed strategies from years gone by.

In a recent McKinsey & Co. study of 197 companies, despite 97 percent of directors believing they had the right “strategic vision,” only 33 percent reported achieving significant strategic success. Other studies confirm this wide gap between strategy and execution.

How is your company’s track record on execution? Are you long on plans and PowerPoint decks but short on results? What is the level of confidence among middle management and supervisors (where real work gets done) about being able to deliver on a major change program or aggressive set of business objectives?

So What Gets in the Way of Strategy Execution?

Recent studies have shown that besides the obvious, lack of funding and a bad strategy, there are several “invisible” yet powerful barriers to strategy execution. And most senior executives don’t know they exist.

• Execution is usually an afterthought rather than an integral part of strategy formulation
• Many initiatives are not directly linked to key strategic objectives. Too often we see pet projects wasting resources on disconnected initiatives.
• Few employees have seen or understand the strategy. Without an understanding of the company strategy, employee engagement and new ideas are limited.
• Corporate culture often acts as a barrier to the levels of teamwork. Openness and innovation are required for effective strategy delivery.
• Disciplined governance of strategic initiatives is notoriously lacking, and day-to-day operations problems often hijack the attention of the senior team away from strategic issues.
• Too often the strategy is developed by an outside consulting firm (after interviewing executives, of course), delivered to management in a dazzling presentation and a thick deck of slides, but with little real ownership by those left behind to implement it.
• Poor alignment at the top and heavy silo focus leads to sub-optimization and resource conflicts, wasting valuable management time.

The Perfect Storm

These and other barriers often combine to create the perfect storm, where an otherwise good strategy winds up being abandoned as too difficult, or in many cases, business-as-usual objectives get substituted for strategic objectives. As a result the company makes incremental progress when it really requires breakthrough performance.

How to Improve Your Strategy Execution

1. Breaking Down the Silos

Because of the traditional silo-focused structure of most organizations, the CEO is about the only individual who has a horizontal, enterprise-wide perspective. The rest of the senior team focuses on maximizing functional operations and meeting budgets. What is required is a shift by the senior team to focus on strategy alignment and execution, and delegate operational issues to managers.

2. Time is the Enemy of a Competitive Strategy

This refocusing of the role of the senior team has two key advantages. First it puts those who have the most authority at the center of the strategy delivery process, so that when a problem is discovered, the focus of the entire senior team is on fixing the problem, rather than the current scenario of endless meetings called by the program office to coordinate between groups and recommend a solution, which then must go upstairs for approval, to result in another set of meetings. All wasting precious time.

3. Downsizing Your Senior Team

The second advantage in making the senior team accountable for the strategy instead of departmental objectives is that it naturally leads to a reduction in the size of the senior team, something all CEOs struggle with. In the normal silo-focused organization, everyone wants to be on the senior team so their department will be represented, especially at budget time. Everyone is looking out for their silo and not the overall business strategy.

By shrinking the senior team to a few key decision makers whose job it is to support the delivery of the strategy horizontally across all organizational boundaries, decision making becomes faster and the ability to reposition people and corporate assets to better suit the enterprise is far easier. This realignment of the senior team also helps grow the next layer of management, who now must step up to assume a bigger role in running the day-to-day business.

Remember, Strategy is an Ongoing Process

Strategy is not static; it is not something that first gets developed and then implemented, precisely as laid out in the binders. Strategy and execution are intertwined, and understanding how they work together is the key to a successful strategy execution.

Bio: John R. Childress is a senior executive advisor with more than 35 years experience working with senior executive teams and global organizations on the role of culture, performance, leadership and strategy execution.An effective public speaker, Childress is the author of FASTBREAK: The CEO’s Guide to Strategy Execution. His writings bring best practices into a synthesis of sage advice for the CEO and business leader committed to improving culture and performance.His new book, LEVERAGE: The CEO’s Guide to Corporate Culture will be released on 01 December 2013.

7 Keys To Crystal Clear Communication

By Lee J. Colan, Ph.D

Question: What’s the one thing we do more than anything else, but we also do it less effectively than anything else?

Answer: Communicate.

Deloitte & Touche conducted a study that found communication was the best predictor of employee commitment. And commitment results in discretionary effort that drives results. So, to get better results, here are seven keys to crystal clear communication:

1. Relevance

There are lots of things to communicate about. To ensure you are talking about what is most relevant to your team, answer these four questions for them:

• Where are we going? (Strategy)
• What are we doing to get there? (Plans)
• What can I do to contribute? (Roles)
• What is in it for me? (Rewards)

Ensure that you are answering these questions before communicating about other topics. When these questions are not answered people tend to fill in the blanks with their own assumptions, and their assumptions are typically worse than reality.

2. Consistency

The same messages should come from your various communication channels and from all levels of leaders. Your team will sniff out inconsistency like a cat sniffing out a mouse. Provide your leaders speaking points and visual aids about new projects, organizational changes, company values and strategic direction to ensure consistency. Things will change, and that’s okay. Just ensure that everyone’s messages also change. If not, you will start to violate the third key.

3. Transparency

It can also be challenging to decide what to communicate to our teams and what to withhold. It’s easy to say (usually to ourselves), “They don’t really need to know all that” or “My team won’t really understand” or “I don’t think they can handle that news right now.”

Remember this: Leaders who underestimate the intelligence of their employees generally overestimate their own. To the extent you can responsibly share information about your business (unless SEC regulations restrict you in certain situations) you build leadership credibility and a sense of ownership to make a difference.

4. Multi-Channel

Your communication channels might include: memo/email, video, Twitter, chat groups, newsletter, company Facebook page, town hall chats, training sessions, team celebrations, bulletin boards, running banners on PCs, video conferences, etc.  Don’t go crazy adding channels just to add them. Select those that are perceived as most reliable. Keep it simple and stick with it!

Remember, the message is in the medium. So, if you are announcing an important new business unit, sending an email might be perceived as matter-of-fact and that the new business unit is not critical to the business. Alternatively, company-wide or departmental meetings with a presentation and opportunity for asking questions suggest to employees that the time, effort and preparation to hold these meetings is related to the importance of this new business unit.

5. Real-Time

Speed rules in today’s business. It is often the only competitive advantage that smaller businesses have over the 800-pound gorillas. So real-time updates, feedback and dialog are key. This also applies to the not so fun stuff. Don’t sweep the tough performance discussions under the rug. The issue won’t go away with time; it will only rear its head in uglier ways. Communicate in real-time — in good times and in bad.

6. Multi-Directional

Communicate downward, upward and horizontally. This means that listening is just as important as talking, if not more so. Asking questions is the most underutilized, yet most powerful, leadership tool. Excellent leaders listen at least 50 percent of the time. After we listen to peers and employees,  we can more effectively communicate a message or idea that is more likely to be well-received.

7. Informality

In addition to scheduling formal meetings and communiques, budget five or ten extra minutes before a meeting to zig-zag your way to meetings, the restroom or lunch. Pop in on your team and ask them how you can help them, what their biggest frustrations are, what big idea they would like to work on, etc. These informal dialogs often yield rich insights.

Joseph Pulitzer (you know, the Pulitzer Prize guy) knew a few things about effective communication, and he reflected several of the seven keys when he said, “Put it before them briefly so they will read it, clearlyso they will appreciate it, picturesquely so they will remember it, and above all, accurately so they will be guided by it.”

Apply the seven keys and you will not only communicate with crystal clarity, you will also more fully engage your team and drive better performance.

Bio: Lee J. Colan, Ph.D. is a leadership advisor. He co-founded The L Group, Inc. in 1999 to equip leaders to execute their plans and engage their teams. Colan has authored 12 books. His soon-to-be-released book, 
Stick with It: Mastering the Art of Adherence 

Concocting The Right Business Strategy

by Joe Evans 

A cornerstone of corporate strategy is knowing your organization’s true value proposition and using that knowledge to innovate the business model so that existing customers can be better served and share of markets can be extended. Developing effective strategy requires business leaders to examine their value statements and to learn how to utilize and navigate the Organizational Value Quadrant (OVQ)¹ model. The four quadrants of organizational value define distinct operating models that relate the company’s positioning relative to the markets served by the business. Knowing which quadrant your business lives in and understanding how to navigate within the OVQ form the backbone of every strategic plan. This article explains the organizational value quadrants, and what they mean to a business in terms of strategy and investment.

Value Proposition; how well do you know it and live it?

For any business, understanding the company’s value proposition is the first step in strategy formulation and must be addressed as a key input to the OVQ discussion.

A value proposition can be thought of a business or marketing statement that summarizes why a consumer should buy a product or use a service. In essence, this statement should help the firm connect with a potential target market in a way that differentiates a particular product or service as to how it will add more value or solve a problem better than other similar offerings.

 

The purest three elements of a value proposition are:

The connection: What is it that makes the product or service inspirational and innovative? The connection must compel the customer to want the product and say, “I need this”.

The differentiation: What is it that makes the product or service indispensable? The differentiation should help eliminate the thought of substitutes in the mind of the buyer.

The substantiation: What facts can you state about the product or service to help create credibility and trust? The substantiation should help the potential buyer to believe in the product or service and take action.

Organizational Value Quadrants

Businesses operate on models designed for value creation that are in alignment with their stated value propositions for each class of products and services. While the value proposition helps communicate the marketing and sales message, the business model must deliver the value promised. That leads to the discussion of value quadrants.

Strategists should always be thinking in terms of value quadrants when considering their firm’s competitive positioning. Method Frameworks focuses on four primary quadrants to classify the business model a company is following. The quadrants are  shown in the graphic below:

 

Each quadrant represents the focus of a company or business unit and can be thought of as the strategy and business model generally being followed. Below is a synopsis of each quadrant:

The Customer Intimacy & Synergy Quadrant

Companies operating in the Customer Intimacy & Synergy Quadrant focus on the customization and tailoring of products / services. Their missions are geared toward know their customers well, delivering what specific customers want and “personalizing” the experience.

Customers of businesses in this quadrant have the expectation of a close relationship that is solution-based for their needs. In return, they are willing to accept a higher cost for the goods or services they are purchasing.

The Operational & Organizational Excellence Quadrant

Companies operating in the Operational & Organizational Excellence Quadrant focus operational efficiencies, supply-chain optimization, maintaining low overhead and accomplishing more with lean structures. Their missions are focused on creating predictability in delivering quality, low price, no-hassle purchase experiences and ease of use.

Customers of businesses in this quadrant have the expectation of low cost and best pricing. In return, they are willing to accept less in the areas of service and relationship intimacy.

The Customer Enrichment & Fulfillment Quadrant

Companies operating in the Customer Enrichment & Fulfillment Quadrant focus on helping their customers reaching and fulfilling their potential. Their mission themes relate to creating better lives for their customers and the opportunity for self-actualization.

Customers of businesses in this quadrant have the expectation of enjoying an experience and learning through exploration and discovery. In return, they are willing to accept a higher cost for the goods or services they are purchasing.

The Product / Service Superiority & Innovation Quadrant

Companies operating in the Product / Service Superiority & Innovation Quadrant focus on creating superior or unique “One-of-a-Kind” value-add services or products. Their missions are geared towards innovation and creating the best products and services available in their class.

Customers of businesses in this quadrant have the expectation of receiving high quality and benefiting from innovation in the products or services being purchased. In return, they are willing to accept a higher cost for the goods or services they are purchasing.

Utilizing The Quadrants In Strategic Planning

Each quadrant groups companies relative to their value propositions and respective customer expectations. Most companies standardize on a business model and force a fit of that model to all their customers. Although it may seem illogical to combine a strategy of individual service (custom-tailored and expensive) with a model of operational excellence (where cost-minimization requires a high degree of process standardization), it can and has been done successfully. A business does not have to be entirely committed to an exclusive relationship with only one category and can use strategy to navigate and position themselves in different quadrants of the OVQ.

Sales organizations have developed impressive sophistication in analyzing their customers and segmenting them appropriately. Likewise, CFOs are highly tuned into profit analysis and many have developed the equivalent of “heat maps” for profitability. Together, they have analyzed their sales and profit data and have developed a clear understanding of which customers are providing them with high sustained profitability. With this combined insight, customer segmentation can then be applied to strategically approach these profit areas with segment sub-strategies. Segment strategy can be applied to invest resources in securing and growing key customer relationships through integration of the company’s operations with those of the key customer’s in a tailored  and effective approach. When this approach is followed, the investments can result in lowering key customer’s cost while increasing the profits of the supplier business.

Customer integration within a value quadrant can be accomplished by tuning customer inventories, smoothing order patterns and even deploying substitute products in carefully-selected situations. The key is to partner with key customers and shift the focus of supply chain efficiency initiatives from optimization solely within the organization’s supply-chain ecosystem to an optimization of the joint vendor-customer supply chain domain. This shift creates enormous new efficiencies for both organizations and helps increase the cost of switching vendors for the customer in the future.

The example above illustrates how an organization can straddle both the operational excellence and the customer intimacy quadrants. With strategic positioning companies can begin to dominate in other quadrants through the creation of other differentiated serving models for important customer segments. Through careful strategic planning and follow-though in execution, a business can actually implement and sustain multiple parallel service models to operate successfully across quadrants.

Recap

Business leaders must begin with a clear and realistic understanding of their value proposition, the first step in strategy formulation that must be addressed as a key input to the Organizational Value Quadrant analysis. A value proposition can be thought of a business or marketing statement that summarizes why a consumer should buy a product or use a service.

The purest three elements of a value proposition are the connection, the differentiation and the substantiation. While the value proposition helps communicate the marketing and sales message, the business model (represented by quadrants of the OVQ model) must deliver the value promised. Each quadrant represents the focus of a company or business unit and can be thought of as the strategy and business model generally being followed. The four primary quadrants to classify the business model a company are:

- Operational & Organizational Excellence

- Product / Service Superiority & Innovation

- Customer Enrichment & Fulfillment

- Customer Intimacy & Synergy

Most importantly, a business does not have to be entirely committed to an exclusive relationship with only one category and can use strategy to navigate and position themselves in different quadrants of the OVQ.

Suggested Reading:

-  Organizational Authenticity

-  Corporate Strategy: 5 Critical Alignments To Assess

-  Value: Create – Capture – Share

-  Corporate Strategy: Multinational Organizations

^{1 – Organizational Value Quadrant based on the work of Edgar Papke}

Leading Strategic Transformation: The Three “I”s / “Eyes” of Change

by Joe Evans 

A majority of companies say they struggle with strategy execution and even those that don’t admit it find it challenging to do. Problems in execution is sometimes due to poor mapping of strategic goals to projects and tasks. That lack of detailed planning certainly undermines execution, but there is often a more subtle reason at play as well responsible for organization’s struggles with execution. It has to do with failing to properly manage change.

That failure may be the result of not engaging employees in the planned transformation, from overly complex plans or changes that are introduced too quickly and ambitiously and therefore begin to unravel during execution. This article discusses the three “I”s of change and how they can help set execution on the right track and smooth the transformation process from beginning to end.

The First “I” of Change: Introduce

Introduce: Managing change begins with sharing the vision of the future-state with those who will be effected and need to know what is afoot. Information and communication are essential in order to help ease resistance to transformation. Introducing change through a well constructed communication plan is the first critical step in the transformation process.

Change that is introduced without setting the proper vision falls flat in terms of being accepted. This happens because employees (and even management) must see a reason and an urgency behind such initiatives; one that motivates them to accept changes to their daily routine. Even with a shared vision and good communication plan, expect change to be feared, resented or passively rejected by the workforce.

So how should change be introduced in order to succeed? The answer to this question is slightly more complex. One viable solution is to create “personas” for the different audiences where change is being introduced. A persona is a sample profile of the target audience, containing the basic attribution of someone the change leader will be communicating with as the business introduces change. Change leaders need to know their audience well enough to understand what various aspects of the changes being introduced will mean to them.  The idea is to get inside their shoes and try to see it from their perspective. Think of personas as a tool used in developing our messaging for our target market. Once messaging is ready, it must be disseminated in cycles to reinforce key points and make sure that the audience has internalized the information. This is the first “eye” of change, seeing it through the employees eyes.

The Second “I” of Change: Implement

Implement: Implementation is the roll-out of planned changes. It may seem at first blush that implementation would be straight forward, enough so that no other explanation is needed. There are, however, actually a few points worth mentioning about how implementation should work.

Implementing change would be easy, if it were easy. Unfortunately, it is not and it confounds many businesses that find themselves in the midst of failing to do it well. That is because organization’s get over zealous and try to do too much too fast.

“We’re going to implement this program, so let’s jump in and get it done now.”

Enthusiasm for accomplishing a goal is terrific, but it is crucial to break up transformations into smaller chunks that can be accomplished and touted as successes along the way. This lessens the complexity of the change roll-out while helping build momentum for the transformation. Positive momentum gradually helps breaks down resistance to change. This is the second “eye” of change. Employees must see accomplishment with their own eyes and the accomplishments need to come often and at a steady pace.

The Third “I” of Change: Institutionalize

Institutionalize: In order for change to stick, it must become the new routine. This means fighting against human nature, which is intent on resisting change and returning to “normal” as quickly as possible. Remember that lasting change is a continuous process; to make change and a new vision part of an organization’s core, the leadership team must keep the vision at-hand. New employees need to be trained and shaped around the vision in order for it to become institutionalized.

To help change persist and becoming part of an organization’s fabric, talk about progress often. Recognize success frequently. Publicly recognize those who contribute so they feel valued. Finally, as key leaders who helped institute the change move on, create a replacement plan that will keep their contributions going.

This also brings up the third “eye” of change. Employees must adopt the vision of the changing environment, accepting it and becoming passionate about it. Without passion the old ways might creep back in – undoing the changes accomplished thus far.

Summary

Managing change begins with sharing the vision of the future-state with those who will be effected and need to know. Chunk up change into manageable pieces and tout successes frequently along the way. For change to last, it must become institutionalized and become the new norm.

Stand In Your Employee’s Shoes and View Change Through Their Eyes

Help those that will be touched by the transformations throughout the organization truly see the vision and understand it. Plan change through there eyes as well, so that obstacles to acceptance can be understood and anticipated. Allow the organization to see changes happening and accept the small success along the way as evidence that the transformation is working. Continue to train and educate about the change program so that employees adopt the vision of the changing environment and see ownership of their own role in accomplishing lasting transformation.

Summary of the Three “I”s	Meaning
1. Introduce	Unveiling of the future vision and publicizing it through well thought out messaging; perhaps developed using personas.
2. Implement	Implementation must be done in small chunks in order to show successes and claim victories along the way. Momentum is important; therefore a steady pace of completed transformational steps along the way helps get buy-in.
3. Institutionalize	For change to last, it must become a way of life. This is what is referred to as institutionalizing change. The implemented change must become the new normal in order to avoid reverting back to the old ways.

Corporate Strategy: 5 Critical Alignments To Assess

By Joe Evans

As businesses muddle out of the recessionary hangover, the fundamentals management matter more than ever. For multi-national enterprises and small businesses alike – it is all about the results. With the pressure to perform ratcheted up to an all time high, corporate strategy and crisp execution are top of mind with business leaders. Crisp execution requires business strategies to be aligned with methodically planned actions. This article addresses five of those key areas where alignment to corporate strategy are essential to business effectiveness.

1.  Strategy and mission alignment

If organizations cannot succinctly explain what they do, how will their marketplace consumers understand it? An organization’s mission statement must be defined broadly enough to allow room to maneuver, yet be direct and purposeful in defining the market(s) served, the products and / or services provided by the firm and the distinguishing characteristics of those offerings.

Let’s look at Target’s mission statement as an example and then break it down into parts.

Target’s Mission:  “Our mission is to make Target the preferred shopping destination for our guests by delivering outstanding value, continuous innovation and an exceptional guest experience by consistently fulfilling our Expect More. Pay Less.^® brand promise.”

What are the key elements?

-  Market Served: economy and quality minded shoppers

-  Contribution: exceptional guest experience

-  Distinction: outstanding value, continuous innovation and an exceptional guest experience by consistently offering more for less

This same information must align with the strategy of the organization. Strategies are broad in scope, but should also be capable of being summed up in strategy statements that employees will understand and embrace. A strategy statement, while being simple in structure, must also anticipate the need for adaptability. Too much specificity in the statement will undermine flexibility down the road.

At a minimum, for strategy to yield competitive advantage, it must address three key questions:

- “What do we do?”

- “Who are our customers?”

- “How do we do what we do better than our competitors?”

The aligned strategy statement “shell” for one of Target’s brands might be stated as follows:

“Our strategy is to _____ by offering _____, at a cost that brings value to our customers unmatched by our competition through  ___ and ____.”

Note the alignment of elements in the mission and strategy:

Contribution = “What do we do?”

Market Served = “Who are our customers?”

Distinction = “How do we do what we do better than our competitors?”

2.  Strategic goals and core values alignment

Strategic goals and organizational core values are both extremely important aspects any business, so overlooking the alignment of these elements is a serious mistake.

Strategic goals should define the outcomes the organization desires to accomplish in measurable terms.

Core values serve as the compass to help steer strategic decision making. Businesses should know what these values are and state them in no uncertain terms.

If a core value of the organization is to respect employees and promote quality of life, then setting goals that are unrealistic and are sure to drive employees into the ground is a violation of that core value. Such a violation represents an alignment issue. While super-human feats may bring about short-term benefits, sustaining them over time is not realistic – therefore, no long-term advantages will be gained.

3.  Strategic goals and operational capacity alignment

The best way to ensure alignment between strategic goals and operational capacity is to face realities during planning and do not allow over zealousness projections to take over. Ask questions.

-  Do our internal systems have the ability to support goal achievement?

-  Will suppliers, distributors and partners be able to keep pace in support of goal attainment?

-  Can our managers and employees step up to the added workload an pressure we will be asking of them?

4.  Strategic goals and core competencies alignment

Strategies should follow a simple alignment rule related to business core competencies. Compete where you have an advantage, otherwise do not. Do the skills and knowledge exist in the right levels within the organization to accomplish the strategic goals? In strategy development, the question of “what should we do” is a corollary to the “what we do” question.  This perspective relates to building competitiveness in your offering and exploring tangential markets that might be exploited, provided that the barriers to entry are not too high and organizational capabilities match the opportunities being evaluated.  Truly gauging core competencies is key to ensuring alignment exists in this area.

5.  Strategy and operational execution tactics alignment

Operations-level planning describes the tactics of execution, correlating strategy to action. Misalignment often occurs here, primarily because companies skip over operational planning altogether or do a poor job of paying attention to details.

The goal of the operational planning is to create realistic and comprehensive work breakdown structures (project plans) for the work entailed in all identified initiatives related to the strategic goals of the client. Additionally, accountability and responsibility structures get established at the initiative and project levels when operational planning is done correctly. This activity has an important alignment to budgets, as it affects resource plans, infrastructure and schedules that might have downstream consequences to sales, marketing and other functions.

In conclusion

It is critically important to build alignment into strategic plans as they are constructed and each time they are refreshed. Alignment refers to sensibly attaching strategies to actions while remaining true to the organization’s mission, core values, actual operational capabilities and core competencies along the way.

6 Habits of True Strategic Thinkers

You're the boss, but you still spend too much time on the day-to-day. Here's how to become the strategic leader your company needs.

By Paul J. H. Schoemaker | @inc

In the beginning, there was just you and your partners. You did every job. You coded, you met with investors, you emptied the trash and phoned in the midnight pizza. Now you have others to do all that and it's time for you to "be strategic." 

Whatever that means.

If you find yourself resisting "being strategic," because it sounds like a fast track to irrelevance, or vaguely like an excuse to slack off, you're not alone. Every leader's temptation is to deal with what's directly in front, because it always seems more urgent and concrete. Unfortunately, if you do that, you put your company at risk. While you concentrate on steering around potholes, you'll miss windfall opportunities, not to mention any signals that the road you're on is leading off a cliff.

This is a tough job, make no mistake. "We need strategic leaders!” is a pretty constant refrain at every company, large and small. One reason the job is so tough: no one really understands what it entails. It's hard to be a strategic leader if you don't know what strategic leaders are supposed to do.

After two decades of advising organizations large and small, my colleagues and I have formed a clear idea of what's required of you in this role. Adaptive strategic leaders — the kind who thrive in today’s uncertain environment – do six things well:

Anticipate 

Most of the focus at most companies is on what’s directly ahead. The leaders lack “peripheral vision.” This can leave your company vulnerable to rivals who detect and act on ambiguous signals. To anticipate well, you must:

• Look for game-changing information at the periphery of your industry
• Search beyond the current boundaries of your business
• Build wide external networks to help you scan the horizon better

Think Critically

“Conventional wisdom” opens you to fewer raised eyebrows and second guessing. But if you swallow every management fad, herdlike belief, and safe opinion at face value, your company loses all competitive advantage. Critical thinkers question everything. To master this skill you must force yourself to:

• Reframe problems to get to the bottom of things, in terms of root causes
• Challenge current beliefs and mindsets, including your own
• Uncover hypocrisy, manipulation, and bias in organizational decisions

Interpret 

Ambiguity is unsettling. Faced with it, the temptation is to reach for a fast (and potentially wrongheaded) solution.  A good strategic leader holds steady, synthesizing information from many sources before developing a viewpoint. To get good at this, you have to:

• Seek patterns in multiple sources of data
• Encourage others to do the same
• Question prevailing assumptions and test multiple hypotheses simultaneously

Decide

Many leaders fall prey to “analysis paralysis.” You have to develop processes and enforce them, so that you arrive at a “good enough” position. To do that well, you have to:

• Carefully frame the decision to get to the crux of the matter
• Balance speed, rigor, quality and agility. Leave perfection to higher powers
• Take a stand even with incomplete information and amid diverse views

 Align

Total consensus is rare. A strategic leader must foster open dialogue, build trust and engage key stakeholders, especially when views diverge.  To pull that off, you need to:

• Understand what drives other people's agendas, including what remains hidden
• Bring tough issues to the surface, even when it's uncomfortable
• Assess risk tolerance and follow through to build the necessary support

Learn

As your company grows, honest feedback is harder and harder to come by.  You have to do what you can to keep it coming. This is crucial because success and failure--especially failure--are valuable sources of organizational learning.  Here's what you need to do:

• Encourage and exemplify honest, rigorous debriefs to extract lessons
• Shift course quickly if you realize you're off track
• Celebrate both success and (well-intentioned) failures that provide insight

Do you have what it takes?

Obviously, this is a daunting list of tasks, and frankly, no one is born a black belt in all these different skills. But they can be taught and whatever gaps exist in your skill set can be filled in. I'll cover each of the aspects of strategic leadership in more detail in future columns. But for now, test your own strategic aptitude (or your company's) with the survey at www.decisionstrat.com.

Is Your Business Telling You It Needs A Break?

Via @vistage by Joe Evans

We must listen to the signals our business is sending us. Organizations get tired and need rest cycles too. Not quite the same as we humans need rest, but instead, organizations cannot endlessly expend energy without replacing it along the way. Like humans, businesses need cycles of work and then rejuvenation. Constant full-speed acceleration, without maintaining the organizational pistons, will wear out the engine and momentum will slow. This means that balance is needed between the need to constantly move the organization forward and the need to recharge energy and celebrate successes along the way.

The relentless charge creates fatigue and burnout within the organization and can lead to an exhausted and ambivalent workforce that is detrimental to growth, innovation and operational excellence of our business. That does not mean that we cannot push or should coast along and slack-off in regards to advancing the betterment of our businesses. However, it does mean that we have to have a formula mixed correctly in order to fuel our business for the long-run. We need to think in terms of running a marathon and not a sprint. Given that, the formula must be calibrated our culture and it must also be attenuated to our business strategy and goals.

This may all sound a bit warm and fuzzy in our hard-driving business environments, but even in the engineering world of thermodynamics, this property is acknowledged as an important consideration. Entropy is a property that can be used to determine the energy available for useful work in a thermodynamic process, such as in energy conversion devices, engines, or machines. Such devices can only be driven by convertible energy, and have a theoretical maximum efficiency when converting energy to work. During this work, entropy accumulates in the system, which then dissipates in the form of waste heat.

So how can this engineering principle be applied in business? There are several ways in fact.

Channel Focused Energy To Avoid Waste

We must focus the uses of energy. In the psychological world, ADD (attention deficit disorder) is diagnosed when an individual meets certain criteria for hyperactivity, impulsivity, or inattention.  Likewise, in the corporate world, organizations can exhibit ADD-like behavior when they mistake activity for effectiveness; when they lose focus on established objectives; and when they respond haphazardly to environmental changes.

Many well-meaning managers and leaders assume that because members of the organization are “active” that they are also “effective.”  In reality, activity does not equal effectiveness; and it’s not representative of indispensability. Rather, effectiveness is the result of “doing the right things, right”. And the right things are those activities and actions that make organizational goals a reality.

Ensure You Have The Right Type Of Energy

A 2003 MIT Sloan study identified four corporate energy zones that can either stimulate or handicap competitiveness. This in-depth study proved that organizational energy and focus is a critical component to success.

Some key points that arose from the MIT study are worth considering:

• After more than 50 years of largely ignoring soft factors, like emotions and feelings, organizations are recognizing the powerful role that emotions play in shaping corporate behavior.
• Corporate leaders are responsible for unleashing organizational energy and guiding it toward key strategic goals.
• Organizational energy is the combination of the company’s emotional, cognitive, and physical states.  While difficult to measure, organizational energy is evident in the intensity, endurance, and innovation processes of a company’s work.
• Individual energy, especially of leaders, influences organizational energy. Likewise, the energy state of the organization affects the energy of individuals.

It is the intersection of intensity and quality that determines an organization’s energy state, which usually falls into one of four categories – “The Four Energy Zones”:

• Aggression zone (responding to threat)
• Passion zone (responding to an exciting goal)
• Comfort zone (coasting dangerously on past success)
• Resignation zone (has nearly given up)

Expend It Wisely, Then Replenish Energy and Renew Excitement

Renewal of organizational energy comes from celebrating the achievement of milestones, then refocusing energy again on the next milestone. Therefore, milestones must be defined in order to be recognized when they are met and rewarded if they are accomplished according to performance acceptance criteria. Large strategic objectives can be broken down into many milestones, so there should never be a problem of advancing the business goals through milestone cycles of hard work and real celebration.

You Can't Analyze Your Way to Growth via @harvardbiz

The biggest enemy of top-line growth is analysis and its best friend is appreciation. Sure, in a small minority of companies and industries, like the smartphone business these days, there is explosive growth, and if an analysis is done of past trends, it shows lots of opportunity for top-line growth.

But in the majority of businesses, if the available data are crunched, it shows a slowly growing industry — one growing with GDP or population. That generally convinces the company in question that there aren't really opportunities for top-line growth, and that in turn becomes a self-fulfilling prophecy.

The fundamental reason is that analysis of data is all about the past. Data analysis crunches the past and extrapolates it into the future. And the past does not include opportunities that exist but have not yet happened. So, analysis conspicuously excludes ways to serve customers that have not been tried or imagined or ways to turn non-customers into customers.

Thus the more we rely on data analysis, the more it will tell a dour story on top-line growth — and not give particularly useful insights. The data analysis of P&G's home care business — hard surface cleaners, dish and dishwater detergents — would have indicated that there weren't many opportunities for top-line growth circa 2000. These categories were growing at something between population growth and GDP growth, clearly candidates for harvesting or maybe sale.

If instead, the core tool is not analysis but rather appreciation —deep appreciation of the consumer's life — what makes it hard or easy; what makes her (in this category) happy or sad — there is the opportunity to imagine possibilities that do not exist.

For instance, suppose your consumers have to clean floors. It's easy enough to appreciate that mopping a floor is a fairly miserable task. Think about what it involves: getting out and filling a bucket, dragging the bucket around and repeatedly jamming the mop in and out of it, and then dumping out and cleaning the bucket. If you appreciate your floor-cleaning customers, you'll be looking to help them avoid having to go through this experience every time they have to clean a floor — because not every floor will need such a heavy-duty approach. It was out of this appreciation-triggered insight that the electrostatic Swiffer anti-mop was born and produced massive top-line growth, approaching $1 billion in sales in a decade.

A similar thing happened with Febreze.

There was a slowly growing market for air fresheners that masked odors emanating from hard-to-clean household items like furniture, drapes, and carpets. However, odor masking was hardly an optimal solution for the consumer. Appreciation of the consumer's feelings would have revealed that genuine odor elimination was the underlying desire.

Out of that appreciation came Febreze, which captures and eliminates the odor molecules in fabrics. Not surprisingly, it also produced spectacular top-line growth where the conventional analysis showed that there wasn't much to be had.

Organizationally and behaviorally, analysis and appreciation are two very different things. Analysis is distant, done in office towers far from the consumer. It requires lots of quantitative proficiency but very little experience in the business in question. It depends on data-mining: finding data sources to crunch, often from data suppliers to the industry. Appreciation is intimate, done in close proximity to the consumer. It requires qualitative proficiency and deeper experience in the business. It requires the manufacture of unique data, rather than the use of data that already exists.

In my experience, most organizations have more of the former capabilities and behaviors than of the latter and hence most struggle with top-line growth. The biggest issue isn't the absence of top-line growth opportunities but rather the lack of belief that they exist. And that is driven by the dominance of analysis over appreciation.

ROGER MARTIN

Roger Martin (www.rogerlmartin.com) is the Dean of the Rotman School of Management at the University of Toronto in Canada. He is the author, most recently, of Fixing the Game. For more information, including events with Roger, click here.