Executing the 2023 Plan

We are in the last two weeks of 2022. By this time, or in the next few days, most companies will likely have finalized their integrated plan (including scenario playbooks, contingencies) for 2023. Come January, and it will be all about the 2023 execution. While there is varying opinion about the recession and its depth in the coming year, there is an overwhelming consensus that there will be much uncertainty in the macro environment.

Managing this uncertainty and executing within it requires designing and setting the approach and operating rhythms, connecting strategy to execution, and leadership to act on what matters most. Using a 3D framework – 'Deliver, Data, Discussions' - ?is one such approach to managing an effective process.

1. Are we Delivering? While most companies will review financials and performance scorecards monthly, a few additional elements described below will help track execution and support the proper discussions (some of which could be part of the scorecard package at appropriate intervals).?

a) Laser focus on the ~5-7 initiatives that matter. These key initiatives could consist of businesses that disproportionately need to deliver to plan, meaningful fee/rate increases to grow revenues/profits, new risky and significant investments, and other risks (for example, sizeable digital talent needs for execution). The initiatives that matter must be reviewed in a cross-cutting manner at the overall enterprise level every month.

b) Reallocate/adjust momentum by:

Using milestones – on/off target. Most plans will have a view to "what by when" by initiative. These could be reviewed quarterly and provide a good yardstick to measure progress. Typically, this view is about achieving specific outcomes, giving insights into on/off target. The most critical initiatives should be reviewed more frequently to see if early intervention is required.

In one situation, and for an important initiative, weekly reviews were held, and the market turned upside-down within weeks. The initiative required quick re-calibration and early intervention to manage outcomes.

Using scorecard performance – sometimes "green" needs attention: When reviewing the scorecards, the attention goes mainly to "yellows and reds" and the path to getting them on track. If it is an important initiative, also discuss the "greens," which might be at a point of inflection in some cases. Accelerate the priority with resources, as it might be a unique window to drive momentum.

In one case, the trajectory of a new business (one among the critical initiatives) was out of the charts and needed additional resources to address the momentum. The CEO's call, in this case, was to make a timely business decision to capture the momentum vs. purely thinking about yearly budgets.

Tracking OKR trajectory. At the highest level, this is about translating the objectives (qualitatively described and called priorities/imperatives in some companies) into key results (quantitative measures to see if the objective was met).?

Getting the O and KR well-defined/written is critical here. For example, in one situation, the company wrote its objective as "Be the pre-eminent platform for X services." The teams made multiple assumptions around the metric for pre-eminence, e.g., market share, revenues, the number of customers, etc., leading to confusion and lack of alignment.

If a company has five priorities to achieve its strategic goals, it may have ~15-20 metrics to measure progress. Each of these metrics should have an accountable primary owner and any other co-owners who need to support them. The OKRs at the highest level of the organization can be shared with the Board regularly. The targets are set for the year with quarterly reviews on the trajectory and resources adjusted (if need be) based on those reviews.

c) Regularly review the company's talent to execute the plan. When talent markets are in turmoil, there are new opportunities for finding and retaining the best talent. Identify your organization's most critical roles. Closely monitor top talent excitement/dissatisfaction, their time in a position, their contribution to meetings/discussions, etc. Get the dialogue going early to address retention risks and simultaneously implement succession plans, as some could be mission-critical roles. Also, talent is not only about senior leaders but also about the vital enabler roles at every level of the organization that is critical for driving execution, including areas where there is a massive, short supply of talent in the marketplace. These dialogues could be small group discussions involving the CEO, CHRO, and other leaders and could happen on a monthly/bi-monthly basis.

2. Are we using the right Data to measure??

Underpinning all the above is the need for data and the "one source of truth." In more than one situation, we have seen data not available for months to measure in the manner that will facilitate the proper discussions. In another case, we have seen multiple versions of the same data floating around in the organization, creating confusion.?

Get the data/analytics team involved early in the effort and provide them with sufficient time to help build the infrastructure from where data can be trusted and used repeatedly.?

3.??Are the Discussions happening, and how effective are they?

?If the overall objective is to stay agile and be bold about resource shifts, then it all culminates in the quality of the discussions. This includes three things, two of them at the highest levels of the organization and the last one regarding teams. The first two are 1) how the leadership team works together and 2) the trust that is integral to having trade-off discussions at the enterprise level. The third one is about building an open environment to allow teams to acknowledge the challenges and highlight the solution path forward rather than solving it top-down.

Overall, discussions need to be forward-looking and solution-oriented, not "gotcha." They should be more about how to solve together as One Team in uncertain times.?

? ??????????????????????????????????????????????????????????***

The above elements help us get ready to execute in 2023. There will be uncertainty, but remember, we managed businesses through a pandemic. Get quickly to another "D" that needs to be the outcome of all the above: Decide. With the correct data, discussions, and team dynamics, making decisions quickly, pivoting as needed, and owning the outcome will be critical as we navigate 2023.