Transformation Framework: Application - 7 Pillars of Wisdom
Stephen Davis
Strategy I Value Creation I Transformation I Turnaround I P&L Owner I Management Consulting I Consumer I Retail I Healthcare I Media & Entertainment I Defense I Aerospace
PREAMBLE TO THE TRANSFORMATION
???????????With an understanding of the SSCI Reports’ contributions to transformation, the scope within which we will apply our transformation framework, and the basis upon which we ought measure the performance of the IC, we can begin to offer more specific transformation steps. The following points offer some guidance prior to the application of an essentially GTG-inspired sequence. Naturally, this applies to any business or organization.
First, change the target. The IC must adopt a new ethos. In addition to our value of and enthusiasm regarding the community’s contribution to foreign policy and national defense we must also become a disciplined, performance-based enterprise. Only then will the IC be able to become a premier institution in its industry, widely admired by knowledgeable policymakers, make an indelible imprint on the world in which we live, exhibit multiple generations of chief executives, and deliver high performance though multiple product, service, platforms, and organizational structures.[1] In addition, though we might one day become a visionary enterprise, we ought start a transformation by merely becoming a disciplined one. Striving for a vision is simply too subjective and too far-reaching. Our more concerted focus should be on attaining the performance three times better than any other government agency and non-profit organization (overall market), and any other foreign affairs or defense establishment (industry) for fifteen years or more. This is not to suggest the IC will never make mistakes causing it to dip well below this benchmark. It does mean the IC will perform dramatically better and recover from missteps quicker than it does now.
Second, we must come to terms with the fact that the IC is an inherently measurable enterprise. The IC is largely characterized by a business-to-business relationship between itself and policymakers. Similarly, a large percentage of the IC can be characterized by a series of internal business-to-business relationships between agencies. For example, one agency launches platforms, controls them, captures data, and stores it. Another agency transports, decrypts, and exploits the data. Another agency analyzes and summarizes relevant material, while another still may fuse it with their and other agencies’ products to deliver a final product or service to a policymaker. We understand the initial objection to characterizing the IC in this manner. Of course we do not work for profit. Of course there is some art in the science, business, and process of intelligence. However, we can and must measure what we do. It is an enterprise with supporting mission and business functions. A series of corresponding exchanges must take place in order for the ultimate benefit to be delivered to a customer. Since these exchanges and their outcomes are subject to particular customers, quality, and satisfaction, they and the processes that create them can be measured.
Third, measure the performance of the IC as an enterprise. The ability to aggregate the performance of many processes, products, services, for an overall set of customers is intuitive enough. Just as we can measure an individual aspect of the IC, we can measure the IC as a whole. We will discuses this in greater detail in the Transformation Concept and Hedgehog Concept sections. For now it is worth noting a dual intangible effect of measuring enterprise performance. First, it sends a cultural message that the IC is a measurable endeavor. Second, it provides a means of estimating where the IC lies in its transformation.
This is not to suggest there will not be some difficulty in deciding how to measuring the IC. Measuring the IC may be more difficult than the commercial space. There is no single, central, public, accepted metric, like earnings per share or profit, which render the IC easily comparable to its peers or competitors. That is, there is no real benchmark or performance scale that currently exists. Similarly, money is not alone a sufficient measure. Money is only an input for to the IC, not an input and output like the commercial space. The IC’s output will be something other than money. However, this does not mean the IC cannot be measured. It merely means we will have to give greater thought to regarding what a single, central, enterprise metric, to which the IC can align, should be.
That being said, the type of measurement we institute may not be fundamentally different that that used in the commercial space (e.g. profit, real stock growth, or earnings per share). The point is not to approximate the commercial space per se. Money is merely a means by which the commercial game is measured. The best corporations real focus is on something beyond money. It is merely a means to an end. To that end metrics like profit, real stock growth, and earning per merely represent an enterprise measurement that aggregates a corporation’s ability to efficiently deliver customer benefit such that they continuously maintain and add additional customers.
Absent a sense of anti-corporation conspiratorialism we would have to admit this is an apt measurement of an enterprise’s ability to efficiently deliver products and services that customer want and need. Customers are not typically duped or coerced into surrendering their money to companies. They give it out of choice because of the value they believe they receive compared to other options. If customers do not or cannot do this, the corresponding corporations not delivering value suffer lower return-on-investment, profit, real stock growth, and earnings per share. Deliver too little value and customers leave altogether and the corporation dies. The relationship between the IC and congressionally mandated budget allocation is not entirely different. To the extent we fail to deliver value our budget will fall. To the extent we deliver wide and great value our customers’ sentiments, and the funding they provide, will increase.
领英推荐
Fourth, realize the timeframe for transformation is long. Be patient, diligent, and exhibit moral courage. It may take even the most talented chief executive and set of community leaders up to four years to solidify a single, central, simple, enterprise metric for the IC. Similarly, it may take fifteen years to appreciably change the performance of the IC at the enterprise level. It will take a lot of work and functional conflict to come to such a crystalline concept and for that concept to cascade throughout the enterprise. However, if done well it will cascade. Improvement, performance, and then excellence will come in small areas, then departments, directorates, and agencies. A performance-based culture will spread continuously deeper and wider, even to the extent that it begins to draw and repel the kind of people that compel and resist still further improvement, respectively. As this takes place the ability to measure the performance of the IC should become increasingly apparent.
???????????Fifth, realize the seminal importance of the right people. On the enterprise level, leaders will need to exhibit a great deal of moral courage. The pressure of, and temptation to react to, public scrutiny and congressional oversight may encourage the IC’s chief and other executives to stray from a path known to deliver transformation. As such, leaders will need to engage with Congress to illustrate the proven approach the IC is taking towards transformation and the progress the IC is making in that regard. The IC should provide increasingly meaningful measures of its performance, beginning with a quantitatively-proven means of transformation capable of delivering similarly quantifiable benefits to policymakers, customers, consumers and the taxpayer within the context of the congressional oversight process. Taking this approach helps avoid devolving into an environment over characterized by urgency and action without a sense of what really drives transformation. In short, it helps perpetuate a Flywheel Effect rather than a Doom Loop.
The seminal importance of the right people should compel the use of models that help leverage greater return from the IC’s human capital. If there is a single message in GTG, BTL, and GO research, it is that performance is inherently driven by people. We must realize the need for a pragmatic and precise approach to getting the right executives and managers in place. We must use managers to drive the engagement and performance of the IC’s workforce. We must understand our most critical roles. We must select and place people such that they are fit to the naturally recurring strengths and talents, yielding the highest possible performance. In order to do these things the IC should use proven human capital instruments, such as Q12 and StrengthsFinder, as a means of placing and retaining disciplined people creating a performance-base culture.
Sixth, realize human capital may be one of the hardest areas of change for the IC. The Gallup Path illustrates the essential value chain between strengths, fit, empowerment, accountability, engagement, management, and organizational and enterprise performance. Ensuring that managers have the empowerment and accountability necessary to drive the engagement of their employees may be a difficult situation to create. It is possible the IC is so underdeveloped, such a matrix organization, or consensus-based that it resists clear responsibility and accountability. Conversations during the writing of this thesis uncover a cacophony of colloquialisms like “you know, you can’t change things,” “you can’t measure what we do,” “you don’t want to upset people by [taking away resources],” “you get a head by empire building - amassing people and money - not by increasing efficiency, reducing budgets, and increasing performance” and “managers are incompetent and not held accountable” are all indicative of a culture afraid of a truly performance-based enterprise. It is not that human capital is not the most important thing for transformation. It is not that the IC cannot lead with human capital initiatives. It is merely that the current corps of IC managers may be so internally focused on their own social structure and status quo rather than a rational and pragmatic view of its customer base and performance measures that getting the right people on and off the bus may require wholesale change in the quality of its managers.
We do not merely say this in jest. Rather it is because of two main types of evidence. First, as we highlighted, the number of sentiments in that regard during discussions related to the subject of this thesis. Second, every IC Employee Survey indicates consistent employee affinities and discontents. The most consistent affinity is regarding the mission and calling of the IC and overall workplace environment. However, as numerous years’ IC Employee Survey results indicate, the IC’s employees are less convinced their job is clear, they are measured to a clear standard, and that relative performance is reinforced, recognized, and rewarded. More specifically, nearly fifty percent of the workforce answers ‘disagree’ or ‘strongly disagree’ to questions of this kind. Moreover, this is a condition that shows essentially no difference, and therefore no improvement, in the last several years. In the context of Gallup’s Q12 model this clearly indicates a management problem.
It may be that our managers lack the empowerment and accountability necessary for them to effectively impact engagement such that they could improve overall performance and impact employees engagement. However, that does not mean there is not a management problem in the IC. It merely means the solution to our management problem is not only resident in the managers themselves. In that case, we would have a larger issue, since leaders would not have, for whatever reason, selected quality managers or placed sufficient primacy on managers and their role in driving performance. As such, part of the difficulty of transformation will be in confronting a consensus based enterprise, which has historically lacked central leadership, with the need to move towards a performance-based culture and insisting that specific people and roles are most responsible for a lack of performance. Here, the need for moral courage among IC leadership and a single central measurement to which we can align the community becomes all the more visceral.
Seventh, invest in mechanisms and institutions that support performance-based transformation. These will be discussed in more detail but include several things. Instruments largely relate to leveraging proven quantitative human capital models such as Gallup Organization’s Q12, StrengthsFinder, and similar measurement for customer engagement (CE11), which is proven to explain variation in the most enthusiastic and productive customers. Similarly, a National Intelligence University should be used to teach the core mission, business, and technology frameworks, knowledge, and skills important for the efficient and effective execution of intelligence by a fully developed and competent corps of government managers and executives.
[1] Last, 2.