By Nate on
7/11/2014 7:38 AM
In business, "if you can't measure it, you can't manage it."
When it comes to executing your business strategy, you must first translate the strategic plan into short-term operating objectives or metrics - and progress must be monitored and measured regularly.
To achieve strategic objectives, your organization must develop short-term measurable objectives that logically relate to the company's strategy, as well as a plan for how your organization plans to compete: how you will be different from your competition.
Unfortunately, this is where most strategic planning sessions end; in a 3-inch binder sitting on a dusty shelf.
What needs to occur next is translating your organization's strategy into actionable plans and initiatives, and perhaps most importantly, translate these plans into measurable gradecards or scorecards which are continually monitored. BOTTOMLINE:
Continual monitoring progress toward organizational goals (both short-term and long-term) helps to keep you focused on what's important, which is an integral and vital part of the execution process. The earlier that course corrections can be made, the better.
By Nate on
6/27/2014 7:05 AM
For better or worse, why do so many companies veer off their strategic plan?
Look for a disconnect between strategy and how resources are allocated, say Harvard Business School's Joseph L. Bower and Clark G. Gilbert, in their article "What Really Drives Strategy?"
"Organizations of any size are built around a series of building blocks, and the bigger the company the more responsibility in those building blocks. Today they are called SBUs—Strategic Business Units—or they are country organizations. If you add up what those people actually do, which ideas they choose to bring forward, and which of those get funded, the consequences of that activity is what adds up to the strategy of the company, not words on paper. And once you see that, you begin to ask questions such as: What determines which ideas get sponsored and funded? If I'm the top management, how can I shape that process, manage it, and give it direction?"
That's what their book, From Resource Allocation to Strategy, is about.
BOTTOMLINE: Interestingly enough, the "disconnect" between strategy and how resources are allocated, as identified in this HBR article, is precisely why it's critical to align your resources and systems. Since up to 90% of effectively formulated strategies fail due to execution, it's critcal to understand that it's after the goals are set that companies run into one of their greatest challenges - their own internal systems - processes, policies, technologies, measures and people.
By Nate on
6/20/2014 7:10 AM
What would be your dream job? If money were not a consideration, what would you do?
A recent Harris Interactive survey among almost 8,000 employees over the age of 18 found the following:
- 45% of workers said they were satisfied or very satisfied with their jobs
- 55% of workers said they were not satisfied
- 20% were passionate about their jobs
- 33% believed they had reached a dead end
- 21% were eager to change to something different
The above statistics paint a vivid picture of how elusive passion can be in careers.
Here are some more observations about dream jobs:
- Dream jobs are absolutely personal. Everyone has a different dream.
- Dream jobs are aligned with a person's core passion. Your passion is what you care most about in life. It is what attracts you and gives you energy. It is what inspires you, and what you can not live without doing.
- Dream jobs consistently leverage your core strengths and skills, draw on what you do best and most naturally, let you do what you are really good at doing.
- Dream jobs minimize the down sides, the things you don't like to do or don't do well. They accentuate the positive allowing you to focus your work time on activities you love to do.
- Dream jobs offer enough compensation to sufficiently support a life style that is acceptable and feels good. If a minimum level of income is not there, even an otherwise ideal fit may not be the dream job.
- Finally, dream jobs are not perfect jobs. Even when the fit is right, every job has some drawbacks
BOTTOMLINE: Stop "dreaming" - start doing. Take stock in yourself, identify your core skills, research the market - and go back to your passion.
By Nate on
6/13/2014 7:48 AM
"A brilliant strategy, blockbuster product, or breakthrough technology can put you on the competitive map, but only solid execution can keep you there. "
So begins the Harvard Business review article "The Secrets to Successful Strategy Execution" written by executives from management consulting firm, Booz Allen Hamilton, Inc .
According to the authors, "Execution is the result of thousands of decisions made every day by employees acting according to the information they have and their own self-interest."
Their research identified four fundamental building blocks executives can use to influence those actions:
- Clarifying decision rights (setting expectations)
- Designing information flows (making sure people are on the same page, have the right information to do their jobs)
- Aligning motivators (recognition and rewards consistent with attitudes, behaviors)
- Making changes to structure
By Nate on
6/6/2014 7:33 AM
The best performing small businesses have five factors in common:
- A strong leadership team
- The ability to attract and retain quality people
- A disciplined approach to their business
- The ability to strategically use technology
- The wise use of trusted outside providers
Top-performing organizations rate not just a little better in these five areas -- but at least 100% better. This whitepaper looks at the results of the research, and identifies five factors that the top 25% of all high-performing organizations have in common.
By Nate on
5/30/2014 7:54 AM
In general, strategic plans can fail for two types of reasons: inappropriate strategy and poor execution.
Inappropriate or ineffective strategies can occur due to:
- Failure to define objectives correctly
- Incomplete SWOT analysis with respect to the desired objectives
- Lack of creativity in identifying possible strategies
- Strategies incapable of obtaining the desired objective
- Poor fit between the external environment and organizational resources - infeasibility
More often than not, however, it's not that the strategic plans fail - it's theexecution that fails.
Here are some common reasons how or why execution falls short of the strategic plan:
- Over-estimation of resources and abilities
- Under-estimation of time, personnel, or financial requirements
- Failure to coordinate
- Ineffective attempts to gain the support of others or resistance
- Failure to follow the plan
- Loss of senior management focus and continued sponsorship
- Inability to predict reactions from competitors
- Over-estimation of resource competence
- Poor communications
- Failure to manage change
- Lack of focus
BOTTOMLINE: Failure to execute (following the plan) is the primary reason why strategic plans fail.
By Nate on
5/16/2014 7:12 AM
"The Keys to Strategy Execution: A Global Study of Current Trends and Future Possibilities", was a research study commissioned by the American Management Association and conducted by the Human Resource Institute.
The research identified the leading obstacles that hinder strategy execution and what companies can do to overcome them.
The following is a quick review of some of the main findings:
- Higher performers tend to be better at executing strategies
- Clarity is crucial to the execution of strategy
- Overall, organizations are not achieving clarity to the degree they should
- Higher-performing companies are much more likely than lower performers to provide clarity
- Alignment practices are widely used and highly valued
- Higher-performing organizations are considerably more likely to use certain alignment strategies
- Speed and adaptability are differentiators
- Decision-making speed remains a major problem
- Employee engagement is a concern
- Leadership development seems to be a deficit in the area of execution
- Customer needs/demands and worker capabilities are the most important drivers of execution today
- A lack of resources and the presence of government regulations are the primary barriers to strategy execution today
By Nate on
5/9/2014 7:11 AM
Strategy formulation, while extremely challenging and difficult, is usually not what concerns most small business leaders. In fact, it's not even planning that worried worries them. It's something even bigger and more problematic.
It's the execution of strategy that keeps many small business leaders awake at night!
Why is execution so hard?
Because making the plan work is even bigger challenge than creating the plan: Making strategy work is more difficult than the task of strategy making.
Execution is critical to success. Execution represents a disciplined process that enables an organization to take a strategy and make it work. Without a careful, planned approach to execution, strategic goals cannot be attained.
Developing such a logical approach, however, represents a tremendous challenge - particularly to leaders of growing organizations.
Here are the key take-aways:
- Making strategy work (execution) is critical - and much more difficult than strategy formulation
- Even the best plans still fail or don't meet expectations -- because of poor execution.
- Despite its importance, execution is often handled poorly by many organizations.
The continual problem?
Much more is known about planning than doing, about strategy-making than making strategy work. And business leaders still don't seem to understand a great deal about the execution of strategy.
The obvious questions?
The simple answer?
- If execution is paramount to success, why don't more organizations develop a disciplined approach to it?
- Why don't companies spend more time developing and perfecting processes that help them achieve their strategic goals?
- Why can't more companies execute strategies - consistently?
Because - execution is extremely difficult. We're all taught to strategize, and to plan - but little time is spent teaching (and learning) how to execute!
BOTTOMLINE: From the CEO on down, everyone within an organization must commit to and own the processes and actions related to effective execution. Everyone must learn to be accountable for their activities and projects, and these effort must relate to the goals, and ultimately the strategy of the company.
By Nate on
4/25/2014 7:20 AM
Why do most companies fail?
- Most companies fail primarily because they don’t have the right team of people
- The CEO might not be right, or the CEO hasn’t chosen the right people in the right positions
- Unfortunately, most new CEOs don’t understand the talent level required at each position and the teamwork needed to build a successful company.
- To have a successful company, most businesses need key people in several categories including research & development, manufacturing, IT, finance, marketing, sales, and HR.
BOTTOMLINE: Hiring right (from position description, to sourcing, to interviewing, to selection, to assessment, to hiring, to orientation, to development, to succession planning) - are all keys to building the right team. Done properly and repeatedly, the organization thrives. Ignore it, and the organization is doomed to failure.
By Nate on
4/18/2014 7:11 AM
A previous issue of the Harvard Business Review includes article entitled "Can You Say What Your Strategy Is?"
"Can you summarize your company’s strategy in 35 words or less? If so, would your colleagues put it the same way?"
"Very few executives can honestly answer these simple questions in the affirmative. And the companies that those executives work for are often the most successful in their industry."
"Conversely, companies that don’t have a simple and clear statement of strategy are likely to fall into the sorry category of those that have failed to execute their strategy or, worse, those that never even had one. In an astonishing number of organizations, executives, frontline employees, and all those in between are frustrated because no clear strategy exists for the company or its lines of business."
Leaders of firms are mystified when what they thought was a beautifully crafted strategy is never implemented. They assume that the initiatives described in the voluminous documentation that emerges from an annual budget or a strategic-planning process will ensure competitive success. They fail to appreciate the necessity of having a simple, clear, succinct strategy statement that everyone can internalize and use as a guiding light for making difficult choices.
Understand there are three critical components of a good strategy statement—objective, scope, and advantage. Then, create a great strategy, which requires careful evaluation of the industry landscape, a detailed understanding of customer needs, segmenting customers, and identifying unique ways of creating value for the ones your firm chooses to serve. Then, find the sweet spot that aligns your firm’s capabilities with customer needs in a way that competitors cannot match. Next, leave no room for misinterpretation and cascade the statement throughout the organization.
BOTTOMLINE: "Words do lead to action. Spending the time to develop the few words that truly capture your strategy and that will energize and empower your people will raise the long-term financial performance of your organization."
By Nate on
4/11/2014 7:10 AM
The importance of business planning is frequently misunderstood.
Here are 9 commonly-held myths: about business planning:
- Most small and new businesses don’t need business plans.
- You need an MBA to write a convincing business plan.
- Business plans are only necessary when you need to raise money.
- Business plans need to be long and address every last detail.
- Writing a business plan makes your business less flexible.
- Writing a business plan takes too much time.
- All the details of a business plan are just too confusing for a first-time business owner.
- You can get funding on the strength of a great business plan alone.
- If you’ve already launched your business, it’s too late to write a business plan.
BOTTOMLINE: As Dwight D. Eisenhower once said, “Plans are nothing; planning is everything.” He wasn’t actually saying that plans are worthless, of course. So what did the war hero and former President mean?
It’s the process of planning that is most important: where you consider opportunities and challenges and ways to meet them.
By Nate on
4/4/2014 7:33 AM
In sports, no one questions the importance of having a good coach.
In music, art, science, no one questions the importance of having a good mentor.
If you're running a small business, why should it be any different?
Yet, everyday, leaders of small and emerging businesses continue to waste thousands (if not tens of thousands) of dollars on ineffective means to the end: learning to develop a top-performing business.
We hear it from our clients all the time: "I spent thousands on books, seminars, consultants; we've gone through planning sessions, brainstorming, etc. - and none of it has lasted."
Frustrating? You bet.
Common place? More than we all want to admit.
Are you hoping for the best? Well, hope - is not a strategy.
Well, there's always "business coaching" - but buyer beware: You actually need more than just a "business coach."
You need a holistic approach - a complete program that includes a repeatable business-building methodology, an external business coach (for accountability), execution software that enages every person, every day, and access to a shared learning community for faster adoption and stronger organziational engagement.
Do you - and your organization- need more than a business coach? Are you challenged with any of these?
- A lack of a solid strategic plan - mission, vision, values, strategic position, vital few objectives
- A lack of well-defined goals - specific, measurable, attainable, realistic and tangible (deadlines and attributable responsible people)
- Wasted time and resources - your people are working on things that do not align with your strategy
- Procrastination, distractions and working on "urgent" things - rather than "vital" things
- Lack of individual accountability - and organizational "entropy"
Do any of these sound familiar? How about all of them? You aren't alone. Every client we talk to has one or more (and sometimes, all) of these challenges.
It's time you looked into Six Disciplines....
By Nate on
3/28/2014 7:16 AM
There's a lot of talk going on these days about accountability.
For some, it's important for their professional lives (i.e., setting business goals, keeping on track, being responsible, etc.) For others, it's more personal (i.e., diet, weight loss, exercising, etc.)
Whatever the case, it's important to understand what accountability is, and ultimately, how it works. Here's a short course:
What is accountability? Why is it important? If you walk into a room and ask ten people what accountability means, you’ll likely get ten different definitions. To some, it’s something you make people do, as in “holding people accountable”. To others, accountability means accepting responsibility, but only when a project goes off course, or it’s too late to fix. When it’s all said and done, a workable definition of accountability might include the following elements: Taking responsibility for your own behavior; doing what’s right consistently; demonstrating personal integrity, and actively participating in activities and interactions that support the strategy of your organization.
Now that we understand better what accountability is, now consider what it isn’t. Accountability is not something you “make” people do. It has to be chosen, accepted or agreed upon by the people within your organization. People must “buy into” being accountable and responsible. For many, this is a new, unfamiliar, and sometimes, uncomfortable way to work or live. Learning how to become accountable involves an element of discipline. Most importantly, individual purpose and personal meaning comes from accepting responsibility and learning to be accountable.
Holding people accountable is really about the distribution of power and choice. When people have more choice, they learn to be more responsible. When they become more responsible, they earn more freedom. By being accountable, they earn the trust of managers and coworkers. When they are more accountable, they understand their purpose and role within the organization and are committed to making things happen
How can you learn to be accountable for yourself? In reality, it’s very difficult to be accountable to yourself. Depending on your frame of reference (professional vs. personal) you need to find someone who can help you to stay on track, to stay focused. Accountability can be the catalyst for unlearning old habits, and learning new habits. For weight loss, it's the reason that WeightWatchers is a multi-billion dollar business. It's also no secret that the tremendous growth in business coaching (for example, like Six Disciplines) due to its success in applying the benefits of external accountability coaching.
BOTTOMLINE: Accountability and positive organizational change come through a new set of conversations. So, what are you waiting for?
By Nate on
3/21/2014 7:12 AM
The need for measurement may seem obvious, however, more often than not, it's overlooked as being unnecessary by many leaders of small and midsized organizations.
Let's look at the top 10 reasons why your organization needs to measure its results:
- Measurement clarifies expectations. Measures are a the most transparent and clear means to communicate expectations to employees.
- Measurement directs behavior. Most employees consciously or unconsciously operate on the following assumption: “tell me how you'll measure me, and I'll tell you how I'll behave.”
- Measurement increases objectivity. Measurement is essential to “managing by fact” – otherwise you are left to lead with charm and personality.
- Measurement makes performance visible. If it’s not being measured, it simply can’t be managed.
- Measurement focuses attention. When people are faced with so many competing priorities for their time and activities, what is measured tends to get their attention – particularly when it is linked to a recognition/reward system.
- Measurement promotes consistency. Unmeasured systems tend to be highly variable systems, with all the negatives for quality that implies.
- Measurement facilitates feedback. Feedback in the form of timely, relevant measures is the basic navigational device of any individual or organization.
- Measurement improves decision-making. One of the major causes of failure in decision-making is poor or non-existent use of data. One accurate measure can be worth a thousand opinions.
- Management promotes understanding. Quality guru W. Edwards Deming thought that systematic process measurement led to the “profound knowledge” that was essential to top quality outcomes.
- Measurement improves execution. As former Allied Signal CEO and co-author of Execution Larry Bossidy has remarked “when I see companies that don’t execute, the chances are high that they don’t measure.”
By Nate on
3/7/2014 8:30 AM
The Six Disciplines strategy execution program integrates the business-building elements of strategy, planning, organizing, executing, innovating and learning, and offers a systematic way for organizations to continually improve and achieve lasting business excellence.
You can think of the Six Disciplines Methodology as a series of annual, quarterly, weekly and daily repeatable cycles which, with each successive pass, helps individuals to be accountable, align their activities with organizational goals, and consistently execute on strategy.
So, what are the Six Disciplines?
Discipline I. Decide What’s Important. The foundation of all strategy formulation is deciding what is most important to your organization (and by implication what’s not important) so the allocation of resources—time, money and creativity—can all be aimed toward this end. In this discipline, organizations regularly review and renew their mission, values, strategic position, vision, their most vital few objectives, as well as agreeing what to stop doing.
Discipline II. Set Goals That Lead. Well-defined goals are among the most effective communications tools available to any leader—yet most leaders don’t know how to set goals that lead their people in the right direction. The purpose of this discipline is to produce annual goals that are clear and measurable. Pursuing these goals will lead the people in the organization to align their activities with the vital few objectives set in Discipline I. The result is a brief company goals statement that every team member can understand.
Discipline III. Align Systems. One of the greatest barriers an organization faces in pursuing its goals is itself. For many businesses, the systems that make up the business are often at cross purposes with the priorities of the company. Why? Because most organizations do not have an organized approach to keep their systems aligned with their strategy. Discipline III, taps the knowledge of the whole workforce to identify the areas where the company will get the greatest return on its investment in policies, processes, measures, technologies and people.
Discipline IV. Work the Plan. One of the greatest organizational learning tools ever invented is the quarterly Individual Plan. In this discipline, every person in the company works with his/her team leader to develop Individual Plans for the upcoming quarter. These goals are reviewed and checked for alignment with company goals. This quarterly plan serves as a timesaving template for a Weekly Status report. The result is that every individual in the company learns how to set goals, understand company priorities, takes responsibility for their own activities, and reports progress regularly.
Discipline V. Innovate Purposefully. Innovation is just another name for problem-solving, and everyone in the company has the ability to solve problems. This discipline is unlike the rest in that it provides tools and principles that are used throughout the other disciplines to help people set clear goals and eliminate barriers to progress.. These goals will align with company priorities, and then employees use their innate creativity to meet or beat those goals. Empowering principles, such as Embracing Constraints and Taking Informed Risks, plus tools like the 100-Point Exercise and 5-Step Problem Solving, are but a few examples of what’s included in Discipline V.
Discipline VI. Step Back. This annual discipline helps the whole organization to step back from the pressure of everyday business and gain perspective on the factors that affect business performance. This is achieved through a series of “discovery exercises,” exploring externals (competitors, industry, economic) and internals (goal performance, stakeholder feedback, measures, etc.). In addition to the organization as a whole stepping back, all individual team members are encouraged to do the same by providing input on each other’s performances. This is achieved by completing a 360° and an annual performance appraisal for each team member.
BOTTOMLINE: The Six Disciplines are described in detail in the award-winning book, Six Disciplines for Excellence, available here from Amazon.
By Nate on
3/5/2014 8:08 AM
Most organizations suffer a major disconnect between strategy formulation and its execution.
And while it's more pronounced in larger enterprises because of complexity, smaller organizations need to make sure they do something (anything!) to remove the barriers to execution.
Unfortunately, the research doesn't bode well for most of us. Consider the following:
- 90% of well-formulated strategies fail due to poor execution.
- 60% of typical organizations do not link their strategic priorities to their budget.
- Two-thirds of HR and IT organizations develop strategic plans that are not linked to the organization's strategy.
- 85% of leadership teams spend less than 1 hour per month discussing strategy.
- Only 27% of a typical company’s employees have access to its strategic plan.
- 70% of middle managers and more than 90% of front-line employees have compensation that is not linked to the strategy.
- Most devastating, 95% of employees do not understand their organization's strategy.
Strategy must be managed explicitly, like any other major process in an organization. In most organizations, this process either does not exist or is incomplete. However, 70% of organizations that used a formal process to manage strategy out-performed their peers. What formal process are YOU using?
By Nate on
2/28/2014 8:10 AM
Here's a profound observation from management guru, Gary Hamel:
"If you want to understand the real strategy, look at what people are doing!”
Indeed, more often than not, there are disconnects or gaps between the strategy that is formulated by the senior leadership team, and how the strategy is executed by the rest of the workforce.
Why the gaps?
Could be for a number of reasons:
Most likely, the recognition and reward system that drives the daily activities and behaviors of each person in the workforce is not aligned with the strategy of the organization. How to combat this situation?
- The strategy is not accessible/available to the workforce
- The strategy is not sound
- The strategy is not well understood
BOTTOMLINE: What people spend time on should be based on how well your strategy, goals and initiatives are articulated. Reward and recognize workers based on how well goals were achieved (results), not on how much activity took place.
- Make the strategy as transparent as possible. The mission, vision, values and strategic position of the organiztion MUST be transparent and available to everyone within the organization.
- Establish Vital Few Objectives (VFOs). Most organizations have 2 to 5 times as many projects and initiatives going on than they can possibly address. Reduce the number of key objectives. Keep the VFOs simple - financial, customer, production, people - and let everything else go. Be very focused on a few things, and do them well.
- Make the VFOs measurable. Define measures, targets, and create a small number of initiatives that support the VFOs. Assign responsibility and accountability to someone for each VFO.
- Define an Individual Plan for each person. On a quarterly basis, develop a plan for every individual, assigning activities from each initiative. Have each person track time and progress toward achieving the stated outcomes. Measure progress and update status weekly.
- Align recognition and rewards based on the achievement of outcomes. Recognition and rewards systems are not to be based on activities, but results.
By Nate on
2/21/2014 8:46 AM
Here's a real shocker:
In a survey of 3,300 senior managers and human resource professionals reported by Rob Lebow in his Washington CEO magazine
- 75% of all organizational change programs fail
Why is change so hard
Most organizations say their most important assets are their people, but few behave as if this were true. Change initiatives typically devote most budgets to structural issues such as technology and processes, not staff issues. There is still a whole notion of focusing on tangible assets and their impact on the bottom line, rather than the intangible assets, which are people
.Organizations don't adapt to change; their people do
Constant change in the organizational environment mean that leaders must not only learn about change and its impact on people and systems, leaders must be able to master the process of implementing change
, just as their employees must learn to accommodate change.
Why do most change efforts fail? Here's an analogy: As with a transplanted flower, it initially wilts after the transfer. However, in time with proper care, it stands upright again. With continued good care, it blossoms. The same holds true with the introduction (transplant or transfer) of a new system (a new idea, business-building method, best-practices, business improvement processes), the productivity curve drops (wilts) - but given proper support and care, the productivity curve loops upward on a continuous positive trend.
is little understood by business leaders, but it is a fact of organizational change.
Some misread the downward curve (wilt) as failure, often triggering inappropriate actions; rather then understanding it as transition trauma that is a normal readjustment, realignment and adaptive phase of change
that requires trust, patience and on-going support.
By Nate on
2/14/2014 8:34 AM
What is the difference between a business coach and a consultant?
A consultant completes projects for you based on their own technical expertise. Often, a consultant will provide suggestions and direction for what needs to be fixed, however, rarely will they help the business leader actually implement the fix.
A business coach guides you in growing your business:
BOTTOMLINE: Not every business needs a consultant, but EVERY business needs a business coach.
- Business coaches provide business leaders with awareness, education, and accountability through regularly scheduled coaching sessions and other proven, best-practices business performance tools.
- Instead of getting paid for billable hours or project work like consultants, business coaches get paid for the value they deliver to clients.
- Business coaches help business owners become aware of their blind spots, and leads them to discover the possibilities in their business.
- Business coaches provide information to help build business best practices and close the gaps and accountability to meet performance objectives.
By Nate on
2/7/2014 8:12 AM
Many of the top-performing organizations we work with every day - have expressed a real need to build accountability into their organization.
Take a quick minute – and consider the following key questions:
- Does each of your team members understand exactly what they are responsible for?
- Does your leadership team set consistent expectations for accountability?
- Do your new team members know exactly what’s expected of them – Day 1?
- Are all of your team members self-managing?
- Do you have a standardized way of monitoring progress? Weekly? Monthly? Quarterly
- Does your hiring process focus on attracting individuals who can be self-managing?
Here are some steps to consider when considering organization-wide accountability:
- Understand your company's core competencies
- Validate your team members
- Create a culture that grows and develops its people
- Identify the systems and processes that are now in place throughout your company and rely on your team members to make the systems and processes more efficient and more effective
- Get the right people in the right place
- Get all team members to understand that what they do affects everyone else in the company
- Build a strong second-tier management team that can take the company to the next level
- Hold everyone, including yourself, accountable
- Raise the bar by bringing in top talent
By Nate on
1/31/2014 8:24 AM
Scott Cleveland reports that a managing director of the Palladium Group (think: balanced scorecard) conducted a survey that compared two groups, one with and one without a formal strategy execution process in place.
A formal process in their terminology means "strategy maps, derived projects and process improvements from it, and associated key performance indicators (KPIs) with targets reported in scorecard dashboards and cascaded down into the organization."
- 70% of organizations WITH a formal process were exceeding the performance of their peers in their industry, while in contrast only 27% of those without a formal process were.
: The overwhelming majority of businesses (and particularly, small and midsized organizations) do not have a formal process for strategy execution. They do not have strategy maps, derived projects, process improvements and associated key performance indicators (KPIs) with targets reported in scorecard dashboards and cascaded down into the organization.
What kind of strategy execution process is your
By Nate on
1/24/2014 8:49 AM
Is your organization "drowning" in too many strategic initiatives?
If you're evaluating far more opportunities than your team can realistically handle, it's time to do a serious screening of those initiatives.
According to Robert W. Bradford, President/CEO of the Center for Simplified Strategic Planning, your organization should only take on between 3 - 10 strategic opportunities, depending on the size, breadth of your team and its resources. (We've found the fewer, the better.)
Bradford recommends a senior team exercise in which you simply ask the team to rate each opportunity on two dimensions – resource requirements and strategic impact on the organization.
- For resource requirements, you may want to anchor the rating on a one to five scale. In a medium sized company, a one might indicate resources commensurate with an individual employee’s initiative – requiring little management of either manpower or money. A two could correspond with departmental level resources, a three with two or more departments, and a five would indicate a need for co-ordination of resources across the entire company.
- For strategic impact, we used one for “nice to do”, three for “important” and five for “critical to our future”. Note that we do NOT rate on a purely financial basis, and in practice, opportunities with a strictly financial payoff were generally given a three impact rating – that is, a simple boost to profit is not enough to earn an opportunity high marks on strategic impact.
BOTTOM LINE: "If your organization is plagued by a surplus of incremental projects or “just do it” items that are overwhelming mid-level management, this approach to opportunity screening may give you one more way to rationally say “no” to things that will impede your strategic progress."
By Nate on
1/17/2014 8:24 AM
Are strategic thinking and strategic planning - the same thing?
While they certainly related and complementary, thinking strategically and planning strategically are two different concepts.
Let's first consider strategic thinking
, which involves viewing your organization from a holistic perspective.
Research has determined that strategic thinking can be explained through seven dimensions:
- A vision of the future
- Strategic formulation and implementation
- Managerial role in making strategies
- Managerial role in implementation
- Strategy making
- Process and outcome
Strategic thinking is extremely effective and a valuable tool, and requires developing skills in creativity, problem solving, teamwork, and critical thinking. The good news? It's a skill that can be learned.
Steps in building strategic thinking skills:
- Critically examine and evaluate the existing situation. Understand what is being done, if it needs to be done that way, and fight hard against the "we've always done it that way" mentality.
- Look at your business as a holistic system. Strategic thinkers view their businesses as a whole: its strengths, weaknesses, opportunities and threats.
- Focus on the future. Strategic thinking is future-oriented. Before considering the viability of ideas, consider their potential contribution to the future of your organization.
- Continuously ask for feedback from your customers. Strategic thinking cannot be effective if done in a vacuum.
- Get realistic data for confirmation. Strategic thinking requires making predictions about the future and forecasts must be realistic. Gather reliable data to justify and confirm your predictions.
- Align your thoughts to your organization. Review your organizational structure to determine if the organization and key leaders are in place to fulfill your vision, otherwise it's a pipe dream.
- Be ready to consider change and unexpected challenges. Flexibility is a critical element of strategic thinking.
Strategic planning, on the other hand, is a continual planning process that relies on strong strategic thinking. When done correctly, strategic planning is not a one-time or annual event. It's an on-going process, reviewed quarterly, that affects the organization's initiatives, plans, and activities.
: Both strategic thinking and strategic planning are important - even vital to your organization - and neither can be ignored.
By Nate on
1/10/2014 8:17 AM
“Why is strategy execution so difficult? …Let’s look at managing change. It should be hard: success means growth, growth means change, and change means uncharted territory. If these more obvious changes aren’t enough, every individual in your organization is growing and changing, too. Also the industry and your competitors are growing and changing—and you can’t afford to be left behind. “Without change,” warns C. William Pollard, Chairman of The ServiceMaster Company, “there is no innovation, creativity, or incentive for improvement. Those who initiate change will have a better opportunity to manage the change that is inevitable.”
But, in the midst of all this change, how do you keep everyone on the same page? (My family of five can’t even agree where to go for dinner!) When we consider each business individually, we might conclude that the obstacles to executing strategy aren’t just complex, they are downright daunting.”
- Six Disciplines Execution Revolution by Gary Harpst.
Management leadership is one of five levels of leadership that Six Disciplines helps organizations develop. To learn more about the impact that Six Disciplines has on the five levels of leadership, Click Here
By Nate on
1/3/2014 8:30 AM
While the Baldrige framework offers proven characteristics of world-class organizations, it doesn't provide you with an implementation model that shows you how to develop and maintain these characteristics, behaviors, and processes.
To achieve the benefits of Baldrige faster, Six Disciplines provides the perfect complement to the Baldrige framework, by showing you exactly how to implement a performance excellence program.
By using Six Disciplines, you get the benefits and the value of Baldrige in one unified program: leadership, strategic planning, customer focus, measurement, analysis, and knowledge management, workforce focus, operations focus, and results.
EXCLUSIVE: Watch an extended interview with the CEO of a Malcolm Baldrige Performance Excellence award-winning organization, as he describes the journey and how Six Disciplines helped along the way.