ALIGN YOUR ORGANIZATION AROUND ITS VISION

Aligning the organization around the vision enables or facilitates not only the formulation of the most effective strategies, but also establishes the process through which those plans are executed effectively and efficiently.

 Essentially, the vision can be considered the primary output of the Business Model and should guide the organization like that beacon of light in the fog that keeps ships from running aground. Vision is a dream and it is statement of strategic intent that highlights the aspiration of an organization. It shows where the business will be in future. The vision should act as a litmus test (along with the purpose of the organization) against which all decisions, investments, resource allocations, priorities and initiatives are reviewed and legitimized. That is, in each case the question should be asked, “Are we being true to our organizational purpose and will taking this action move us a step closer to achieving our vision?” This is how you stay on track – focused and moving toward achievement of the vision.

Mara(2014) identified few of the mistakes that can diminish the power of creating a vision and aligning the organization around it:

1. The organization’s vision is not on the employees radar screen – it is not even on management’s radar screen! According to Mara(2014) What do I mean? I have gone into so many organizations where I have challenged the Management Committee to write down their vision. Less than 10% can do it and usually only as a group effort – not individually. Sad – yes. An example of Lucite management? Put a plaque on the wall with a great sounding vision and that gets it done, right? Well hopefully if you put it in the reception area or lobby some of your customers will notice it and think it sounds great and possibly your employees as well! Too often the vision, like the plans or strategies, is developed as part of an esoteric process to which only selected senior managers are invited and then it is ceremoniously handed downward to employees.

2. The vision is not exciting or inspiring. Employees, customers and suppliers read it and begin to yawn.

3. Even if senior management knows the vision, they fail to communicate and continuously reinforce it with the people in the organization who are the very ones who ultimately must take the organization to that destination!

4. No one understands the vision – not even senior management! In going into the credit card operation of one of the UK’s largest banks some years ago and talking to the employees, (Mara2014) posits that he found that no one really knew what the vision meant or the employees told him, “No, we don’t do that around here”. This is not at all uncommon in my experience. Or if you ask the Management Committee to come up with a simple way of explaining the vision to the people in their organization, each of the 15 members of the MC – or however many there are – will interpret it differently!

5. Senior management is unsure about what it will take to achieve the vision – oh no, we’ve created a monster! They are also unsure regarding the timeframe in which they hope to achieve it.

6. Senior management has not communicated what they expect from employees and therefore the employees are uninformed about what their contribution needs to be to help achieve it. Or senior management simply ignores trying to reach the hearts and minds of employees and instead takes the Neanderthal approach of command and control, in effect, substituting autocracy for leadership: “Around here we pay you to work, not to think. If you can’t get the job done, then we’ll get someone who can” – people after all are just tools, right? When management asks them to jump, their only response should be “how high?”

7. Senior management has not ensured people in the organization have the capability or requisite competencies they need to help achieve the vision.

8. The members of the leadership team themselves have not bought-in 100% to the vision and therefore are not 100% committed to making it happen.

Previously it was mentioned that some original research was done in the UK and Ireland called the “7 Deadly Sins of Management”. It is interesting to note that CEO’s and Managing Directors interviewed agreed that “lack of a vision and alignment of the organization around that vision” was the number one most serious failure of senior management – guaranteed to ensure the organization under-performs or ultimately fails.

Critical Components of Alignment

Vision is that part of business model \ where the planning is carried out ie both formulation as well as the execution of the plan. Consequently it is essential that it be done and done right for the sake of the business now as well as for the future. The right things need to be done for the business – not just those things which make the organization look good on paper or to the financial markets, shareholders and investors or ensure larger bonuses for senior management.

The first element of Vision Alignment is determination of what are called the Critical Success Factors (CSFs).

There are two easy ways to think about critical success factors – those factors which will ultimately determine whether you will succeed or fail at achieving your vision.

Here they are:

1. Talk with your Management Committee (MC) members and ask each one of them to identify those things which your organization must do and do right day in and day out in order to achieve the vision. Or, on the flip side, failure to do any one of these things right may well jeopardize the organization’s ability to achieve the vision. Then share among your team and come to agreement. Ideally you should have three to five critical success factors (CSFs). In fact fewer are better but with an absolute maximum of five to seven. Try to get focused. Look at issues of interdependence between the ones you identify as there may be overlaps. Try to keep them as mutually exclusive as possible – it won’t be entirely possible as everything in one way or another, large or small, links to everything else. These will tend to be relatively high level factors. This is NOT an exact science; OR

2. Again, discussing with your MC, have each person identify those items which they believe to be the most important factors the organization MUST focus on, invest in or emphasize continuously to achieve the vision – relentless pursuit would be a good phrase. Again, share and come to agreement – 100% agreement! And 100% commitment.

Often in practice, these CSF’s are areas such as “providing innovative solutions” or being “intensely customer and market focused” or making “people make the difference” a reality in the organization by investing in your human assets – generally high level domains, which in the second step we will start to get underneath.

Another good exercise, from experience, is to ask each member of the MC what contribution they individually as well as the part of the organization for which they have responsibility can make to each CSF. While this will become refined as you go through the process, it begins to move the organization, at least at the senior level, toward establishment of ownership and accountability early in the process. It also

ensures that you are working as all one team toward a common goal, namely achievement of the vision and focused on doing what’s best for the overall organization. It may also be instructive to ask the MC members for their opinions as to the barriers or vulnerabilities which could prevent attainment of the vision and come to agreement on how to mitigate them.

Mara(2014) identified the following as critical success factors:

? Powerful business development

? Excellence in human resource management

? Strategic stakeholder management

? Enterprise resource planning

? Operational excellence

? Continuous improvement, innovation and learning

? Alignment with our organization’s vision

The second component of Alignment is referred to as Drivers of Performance.

The CSFs are high level – more strategic in nature. Now let’s drill down a bit to get to those areas which can be more easily acted upon and around which strategies can be also more easily and clearly formulated. This will make the process of moving forward and achieving the vision more manageable. So, the challenge here is that you and MC members must ask themselves the following question:

Looking at each CSF, what would you say are the one to two factors preferably which, more than any others, drive or will drive our performance as an organization in each of those three to five critical areas identified above such as providing innovative solutions or continuous improvement, innovation and learning?

You do not want more than three factors or drivers so prioritize, prioritize, prioritize. Here the focus must be on the absolute essentials – the vital few not the nice to haves. Again, ultimately you must set objectives and define strategies. You can easily end up with 20 or 30 if you are not careful. With this number, it is humanly impossible for an organization to achieve forward traction as there just not enough resources available to make it all happen. Focus!

Examples include “talent management/succession planning” or “employee engagement to ensure higher emotional attachment and commitment” or “designing specific relationship strategies for the top ten most important accounts or most important strategic stakeholders” or “design and implementation of a customer and supplier lab to test new innovative concepts and gain additional ideas for differentiating our products and services or adding new ones to the portfolio”. The list can go on, but a word of caution no more than three Drivers for each CSF please!

Once again, taking an example from SME systems integrator, the drivers for one

CSF (Strategic Stakeholder Management) were:

Strategic Stakeholder Management

? Build secure customer relationships by establishing unique relationship strategies which deliver exceptional value.

? Carefully select strategic alliances and business partners – building and strengthening our working relationship and collaboration with them.

? Align key business objectives and strategies with an understanding of stakeholder expectations and our goal of adding value in the relationship.

Continuing, the third component would be the Key Business Objectives (KBOs).

The purpose is not to take you through the basics of Key Business Objectives – how they need to be measurable, with specific, achievable, realistic and timebound. You’ve been there before and you are well beyond these basic issues. Once again, no more than one to two KBO’s for each Driver of performance! Otherwise you will soon have 30 KBO’s and be unable to deliver on few of them due to the finite resources available.

The unfortunate thing is that many organizations will have, in fact, as many as 30+ KBO’s.. The KBO’s had been developed in an isolated set of work activity without any reference to the vision. So one has to ask, “Why was the vision created in the first place if it was going to be ignored and if everything the organization was trying to accomplish was unrelated?”

Key Business Objectives

? Identify, approach, and establish a relationship with ten target accounts which have been assessed as value oriented based upon our criteria (e.g., have a strategic orientation, want a supplier they consider as a valued business partner and is an organization that focuses on value added not price) in the next three to six months.

? For existing value oriented accounts, develop and execute a specific relationship strategy in the next three months for each of the top 15 (based upon our criteria) that will enable us to go deeper and broader within that account and ensure profitable growth over the next three years and beyond.

The fourth component is the Business Strategies/Action Plans.

Now, for each KBO, you need to define a strategy or action plan on how you will achieve it – something which you can monitor progress against as well as its impact on a monthly basis. It should have tasks identified, timing, ownership/accountability, interdependencies highlighted, potential barriers and how to overcome them and measures of success well defined.. Again, these business strategies or action plans together should comprise the overall business plan for the organization.

Looking at the example of the SME systems integrator and now focusing on KBO #1 above (e.g., new value oriented target accounts), the following could be considerations for developing the action plan/strategy:

1. Who owns this KBO? Who can contribute most to its achievement?

2. Is there a need for a sponsor – a member of the leadership team or a domain Council to act as a sponsor?

3. Should we form a cross-functional Strategic Business Improvement Team (SBIT)

to execute the action plan/strategy? Who should be on the team? Who should be the team leader? How do we ensure we use this experience for development of people on that team? Is there a need for any further training/knowledge/learning to take place to ensure team members have the capability to succeed?

4. What are the steps which must be taken to ensure this KBO is achieved?

5. How do we ensure flawless and complete execution?

6. What are the timing of the activities/steps required for achievement?

7. What are the interdependencies? That is, what other groups (departments, functions, divisions, or even external business partners or suppliers) are we most dependent upon for ensuring we are successful in achieving this KBO?

8. What will be our measures of success (qualitative and quantitative indicators)?

9. How soon should we implement our quarterly relationship review process and

gain feedback to determine how well we are doing in the eyes of our new account

and how we compare to other suppliers they may be utilizing?

10. How will we assess the value we are delivering and to whom? Is it recognized?

11. How will we monitor progress? How often will we monitor progress/look for a

status update? Who will be involved?

12. What do we perceive the barriers to achievement to be and how do we mitigate them?

13. What is the communication plan to keep our people and our stakeholders

informed?

Just a quick word based upon my experience. Because of the extremely dynamic nature of markets today – the turbulence, it can be helpful to have an 18-month rolling plan with a three year horizon. This will not fit all situations! But if you review the plan on a trimesterly basis – looking at progress over the past three months (you still have monthly progress reviews against action plans and looking at measures of success) and then adding another three months out each time (to keep the 18 months forward and three year horizon), you may find that this can work effectively and efficiently for you.

Also, it is critical that the right questions be asked during the reviews. These reviews must not be interrogations, painful, or brutal exercises. They need to be constructive. Also, because the MC is all one team, one senior executive’s problem is everyone’s problem and potential suggestions and solutions should be sought from everyone on the MC. Too often one MC member gets caught in a difficult situation and his or her organization’s performance is not meeting planned targets/objectives while the others just watch him or her struggle.

The last component of Alignment is the Infrastructure.

If you want to get your plan implemented as flawlessly and completely as possible and as efficiently as possible, you may need to consider having the right infrastructure. In other words, it is suggested that you create a selective number of Councils responsible for key plan elements – they become the focus and the owners – accountable for results.

It can be challenging, particularly in a national or global business, to get the whole leadership team together and get decisions on issues quickly even at the normal monthly review meeting so instead the suggestion is to establish four Councils as part of the overall approach to aligning the organization. Each Council will have a subset of the MC members – the CEO will be included in some of the Councils (one to two potentially) as well.

The focus is on speed and agility here as well as reducing the demand on senior management’s time. Do not always pick the usual suspects as members of the Councils listed below – get some diversity of membership – diversity of thinking and experience. So, just as an example, the Human Performance Excellence Council may have the CTO or CIO as a member and so on. Don’t be afraid to mix and match – it will work out for the best in the end – trust me! Sometimes it is useful to have the objectivity or someone asking the naive questions or playing devil’s advocate which can cause people to rethink their positions or what they are about to do. So here are the initial set of Councils I suggest for your consideration:

1. Human Performance Excellence Council – anything and everything related to people – engagement, recognition, communication, building a community of trust, career planning and the list goes on. Making sure people are reaching their full capability to contribute to the success of the organization and that barriers to their success are being eliminated!

2. Operational Excellence Council – anything and everything related to business process, efficiency, productivity, 6-sigma/lean, and the list goes on. Making sure that the routine things get done and done right, first time, every time – reliability must be a top priority!

3. Competitiveness and Growth Council – anything and everything related to new product/service/support development and launch, R&D, innovation, learning, adaptability, agility and the list goes on.

4. Relationship Mastery Council – anything and everything related to building

exceptional relationships with any key stakeholder group from customers to suppliers to the community and beyond – and some overlap with Human Performance Excellence as the leadership team needs to know how to develop exceptional relationships with the people in their own organization (as well as with stakeholders) – making their people want to be followers!

Each of these four Councils must be supported by a Strategic Business Improvement Team (SBIT) composed of three to five team members. They must be cross-functional and all should be high-potential individuals. Part of the purpose of this process is to develop these individuals and watch their performance so they can be moved into appropriate and higher level positions later on.

These SBIT members must now, often for the first time, take a holistic view of the organization – not just their departmental, functional or divisional view. They may need some training in basic skills such as process management, quality tools and techniques or others – so be prepared to provide it. They may also need help with their presentation skills as each month they will be asked to present progress and results to their respective Council. Their performance in this role must be considered in their overall performance evaluation for the year as well as in assessing their leadership potential.

Councils should meet once per month with their respective SBITs and there should be one combined meeting of all Councils once per month so that everyone has a chance to see, discuss and challenge progress and results. Just as an aside, it is true that structure should follow strategy. It is also true that successful strategy execution is much more about process, people and culture than any other factors. It may well be that some of the initiatives or strategies needed to

achieve the KBOs will require structural changes as well. If so, the SBIT supporting the appropriate domain Council can be very useful in terms of gathering insight and information, talking with others in the organization and laying the groundwork and support for change in a very participative and constructive way. The idea is to get out in front of any potential change and communicate, communicate, communicate and involve as many as possible in the change process.