It starts with you
“We spent time working with really expensive consultants to develop our strategy and plan for the next five years. It looks fantastic. The board approved it in one meeting. All good. Yet six months later we are struggling to gain traction” the CEO said to me in our first meeting.
“How successful have you been in executing your strategy in the past?” I asked.
“To be honest we have not spent much time on developing strategy, priorities and projects other than the spreadsheet of financial projections we send to our superiors, so this is new for us” she replied.
“In that case, how did you and the leadership team decide to lead differently this time given that you wanted a different outcome to previous attempts?” I asked.
“Lead differently”? she asked, looking rather confused.
“It all starts with you, the leadership team. If you don’t lead differently then nothing changes…”
Leadership teams regularly do not get to execute their strategic plans. One study suggested that over 65% of large companies failed in the execution of strategy. Yet we keep producing MBA graduates from esteemed business schools all over the world who study Porter, Prahalad, Hamel and other great writers on how to create strategy. So what is going wrong? Our experience of working with leadership teams who successfully transform their organisations focus on the intersection between their leadership, the strategy they develop for the organisation and the culture they develop to ensure the strategy gets executed. Sounds rather simple, but in reality these are intertwined and interdependent.
There are some key areas these teams get right.
There is a clear destination ahead.
They develop a strategic plan with a visible strategic narrative for the whole organisation to understand. Usually accompanied with clear visuals, the narrative suggests a destination, often in a specified time in years ahead and the specific results to be achieved. These vary depending on the organisation but can include financial results, market share, product releases, market growth, net promoter scores ratings, customer satisfaction ratings and employee retention rates. For the leadership team and their direct reports, this allows a clear cascading of responsibilities down their functional lines.
They build the interdependent project execution plans together
We have all seen great communication plans that are cascaded down the organisation to ensure alignment to the espoused goals. Strategy is communicated via objectives, performance outcomes, balanced scorecards, progress measurements and reward systems. Nothing new here. Therefore, we can assume relatively easily that most organisations at least know how to align the whole organisation behind its strategic intent.
A recently produced study outlined in HBR illustrated how an interesting insight. When surveying over 8000 leaders across 250 companies it was found that the majority of leaders were comfortable in relying upon their leader to deliver what was promised. But only 9% were fully comfortable in relying on their peers to deliver their part of the bargain. This leads to internal delays, duplication of effort, multiple meetings to gain quick decisions, turf wars and overall poor coordination.
To avoid this the leadership team needs to actively oversee the coordination of project execution across the organisation to ensure the blockages that are occurring internally are resolved quickly.
They develop a team operating rhythm that allows them to oversee the initiatives and projects being undertaking and to regularly review progress.
A key mantra of successful leadership teams is “progress over perfection”, meaning we won’t always get it right but we can always seek to improve. Many leadership teams develop great plans but fail to collectively measure their progress or success. This means corrections, tweaks or even project abandonment is difficult.
Innovation teams understand the importance and reality of trialling, testing, reviewing, failing and restarting. Recently I heard the story of why WD40 is called WD40. A small team of three – who were the whole company in 1953 – were focussed on solving an issue for rust prevention in the aerospace industry. WD stands for water displacement. Experiment #1 was called WD1, experiment #2 was called WD2 and so on. Experiment #40 worked. The original secret formula for WD-40® – which stands for Water Displacement perfected on the 40th try – is still in use today.
From a leadership team perspective the notion that all plans and projects will go to plan successfully is of course nonsense. Therefore having measures in place to manage their navigation is an imperative.
They agree together on the importance of performance across the organisation and the consequences for poor performers
Every senior leader, I will repeat that, every senior leader I have ever met says they want to build a high performance execution orientated culture. Great! Lets talk about how you deal with poor performance.
High performance starts with points 1, 2, 3 above. Great execution starts with dealing with those employees and managers who are not executing their part of the deal. That means having clear, frank and transparent conversations. Successful organisations that achieve their strategic aims, skill their leaders in how to monitor performance and deal with delayed actions or inconsistent performance. The really great leadership teams then go on to develop skills in fostering experiments, innovation and cross functional collaboration.
But the most important skill these leadership teams develop is how to handle under performance across the organisation. Improving performance and being seen to tackle under performance is the most important skill leaders develop when transforming an organisation towards high performance – that is high performance, as defined by them.
If your organisation is not achieving what it set out to do, which of the four reasons above resonate for you?
I would love to hear your comments below.