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Seven Must-Do’s for Better Strategy Execution

how can you collect leading and lagging indicators

A 2005 survey identified seven factors necessary to close the strategy-to-performance gap and those factors are valid for strategic initiatives launched in the present day. The survey 197 senior executives at companies with sales of at least $500 million. You can read more here. The survey asserted that,

Companies are delivering only about two-thirds of their potential due to failures in planning and execution.

The survey asked the executives what should be done to close this gap, and there were seven ranked-ordered responses. This article lists those factors and provides links to selected articles that provide useful practices.

Priority 1 – Effectively communicate the decision(s) made as part of the strategy

In this article. I discuss the communication of a decision into the strategic initiative program, and throughout the organization. You have to be clear on the decision itself, the value that is created, and especially on the future impacts on the organization and its competitive environment.

Priority 2 – Identify specific actions in the form of initiatives, programs, projects

One important element is to recognize the definition of a strategic initiative is that it is a program designed to close a performance gap.  Programs are different than projects and portfolios.

I think it is particularly important to emphasize that an organization should keep the number of strategic initiatives to a few. This article provides some evidence for why that is important.

Priority 3 – Establish milestones and track progress against them.

Timelines and project controls are useful starting points, but there is much more that is necessary for excellence with strategic initiatives.

Use program management and project management disciplines. Understand the differences between programs, projects, and portfolios.

This article describes why you should not be concerned about deadlines, and this article discusses small wins .

Priority 4 – Foster accountability so that individuals know and agree with metrics

I’ve also written on the topic of the metrics that matter .

Priority 5 – Give people the resources, authority to execute.

This article describes a helpful rule of thumb (allocate 20% of your time) for assuring that you’ve allocated enough effort.

Another important point is to develop an effective working relationship between the program manager and sponsor, as described in this article .

Priority 6 – Get the right people involved from the beginning

The program manager  (a.k.a. strategic initiative leader) is probably the number one success factor, but it’s also important to have the right support expertise  involved.

Priority 7 – Measure individual performance and make it more consequential.

Accountability is the willingness to have your performance measured. You can learn more in this article .

What do you think about these findings? Would you rank any of the priorities higher or lower?

Strategy as Problem Solving: An Example from a Large Technology Organization.

By Craig London, Guest Contributor

I am a technology project manager for a major financial-services company (MajFin). I’d like to share how I took the concept of “strategy as problem solving” and applied it to my own organization’s strategic problems.

As I endeavored to take a strategic perspective, I found my question keying on this challenge: how do we create a strategy that both identifies the critical problems to be solved and creates a strategic journey to solving them? I came to see this in the following terms:

Critical Problems to be Solved

In MajFin, we have a large group that we call the Operate Team. It is dedicated to supporting the production environment, the large and complex computer systems that run the day-to-day business. The Operate team tends to be dissatisfied with the work they deliver. Too, many people perceived that customer satisfaction was also low.

I thought about how to define the situation. There were many symptoms and three of them seemed very important. They were (in priority order):

  • Unappreciated. The Operate Team members often worked very long, and sometimes irregular, hours in resolving critical system issues. Team members often feel that their contribution isn’t valued.
  • Reactive. Much, if not most, of the work performed by the Operate Team is in reaction to some problem or event. While everyone is glad to see the problem fixed, there is often discussion as to why the group can’t anticipate more problems.
  • Opaque. Due to the nature of that work, the amount of work performed by the Operate Team can be very difficult to measure. The Operate Team’s work is largely unseen by most in the broader organization.

These symptoms were important to us and worthy of problem solving effort. I felt they are not just the result of some inaccurate perception or lack of understanding about the work being performed by the Operate team. Perceptions could be changed through better communications between the Operate Team and the broader organization; key problems needed solutions and this meant that there needed to be a strategy.

Defining the Strategy Pillars and the Strategy I mplementation

The critical problems led directly to defining the strategy pillars :

Based on the problems identified, the translation from “problems” to “strategies” became clear. Unappreciated is transformed into value added, reactive to proactive, opaque to transparent. I had been told that strategy was a specialized kind of problem solving. This personal realization made it relevant.

As I looked at how I had initially ordered the problem, I saw I was focusing on the most salient part of the story (the customer did not appreciate the efforts of the Operate Team). What I had done was focus on the most painful symptom, the Operate Team was unappreciated. Naturally, I saw the highest strategic priority being “value added.” But, as I looked deeper, I saw that there was a “strategy story” that with the flow of elements as shown in this graphic.

I began to grasp the issue: our opaqueness (the work being performed is both unseen and poorly understood) was creating a reactive organizational response and behavior. This, in turn, creates the overall feeling of being unappreciated. This was my first cut. I needed to think about things not in terms of their emotional impact on me and the Operate Team, but rather in terms of X causes Y.

Once I drew the graphics, the approach seemed obvious. Keep in mind that my situation at MajFin is like many other complex operating environments: there are many moving parts and everyone is busy focusing on all those moving parts. It is hard to find a good perspective, and hard to focus.

The key lesson. Understand the linkages between visible symptoms and root causes. While I want to move to “value added” as quickly as possible, it became clear that I need to focus on the leading indicators. My most important strategic objective, Value Added, cannot be achieved without obtaining the benefits from the other two predecessor goals.

As we charter this as an initiative, it has become clear that we need to identify basic incremental metrics starting with the Transparency Pillar. We will deliver those benefits incrementally. As we demonstrate progress, we expect more support that will lead to the Operate Team’s “value add.”

Do you work in a complex environment? How do you gain a strategic perspective?

Five Mental Anchors that Impede Your Strategic Initiative

Mental anchors are reference points that people use in decision making. As an example, people tend to be loss avoiders when making decisions because they are anchoring to the things they already have.

Anchoring to the past or present allows the status quo to perpetuate. Strategic initiatives, by definition, are programs that intend to be transformative. Consider then, the challenge of cultural change is this:  how do we change the reference points? How might we loosen up the anchors to the present and strengthen the anchors of the future?

Here are strategic initiative leadership five actions you can take:

Identify those beliefs that have become distorted. Here is an example: IBM’s Lew Gerstner faced a challenge with a corporate value called “respect for the individual.” When originally formulated by IBM’s founder (Thomas Watson), the idea of respect for the individual was simply that: show respect to others, and expect it in return. Over time this worthy idea devolved to create a culture of entitlement, with no accountability. Your organization likely has distorted beliefs that take away the focus on strategic imperatives. What are they?

Be sensitive to habits and routines. Every established organizations has them. Sometimes they are quite useful, but in too-many cases, they are inertia that blocks progress.

Frame decisions as “carriers of future value.” Decisions are made in the present, but affect the future. Stated differently, a decision to perpetuate the status quo has a different value than a decision to invest. Since all resources become obsolete, a decision to carry on with the status quo may actually have negative value.

Be open minded. Imagine the decisions, thoughts, and feelings of others. In particular, I find it helpful to imagine a “next generation” in the organization, and how they would view the significance of my strategic initiative.

Be careful about announcing anchors for schedule and benefits. People want dates, budgets, and results. Whatever they first hear will become an anchor and set an expectation. Obviously, think it through and consider the presence of risks in the program. Too, be wary of accepting due dates and expectations;

analyze their feasibility and if you don’t agree, make it part of your issues management approach.

What are some other anchors?

Five Must-Know Patterns of Disruption

Strategic initiatives are tools for achieving industry leadership positions, or for defending leadership positions. Strategic initiatives are game-changing programs. In this article, I explore some concepts that will challenge your assumptions, and make you a better strategic thinker.

1. You’re either an incumbent or a disruptor

Over history, very few institutions have held together. Those that have sustained have had to adapt: churches, governments, militaries, etc. Technological change and social change and environmental change are just a few of the causes of this disruption. Given that, I offer these propositions:

  • A mature organization is usually an incumbent, and is vulnerable to disruption.
  • Any organization has the potential to disrupt other organizations.

2. Incumbents are disrupted when their attention is elsewhere

Distractions are a problem. I’m reminded of Tolkien’s Lord of the Rings Trilogy. Sauron’s evil eye scans across all that can be seen. A small party (Frodo, Samwise, and Gollum) are sneaking right into the heart of Sauron’s power. Sauron’s eye occasionally notices them, but events elsewhere distract the eye. In the end, Sauron is destroyed – disrupted – by the small halflings. They were noticeable, but the incumbent power did not pay attention. Here are three more examples:

  • Kodak invented digital photography, but was unable to exploit it as it kept focus on traditional film-based technologies
  • Xerox invented many of the technologies that are now common in personal computers, but failed to exploit
  • Microsoft missed opportunities that were later exploited by Google, Facebook, and others

Stated differently, lack of attention to small existing forces allows disruption to sneak into your incumbency.

3. Disruptive innovators have open minds and open objectives

Innovation happens when a “hub” brings together disparate knowledge networks. Christopher Columbus’ time in Lisbon during the 1480s was critical to capturing all of the necessary elements of a strategy to sail west across the Great Sea to open new trade routes.

Thus, an important idea of disruption is that there is an unpredictable, serendipitous nature to it. It occurs at the micro level, when an individual (actually, it is more commonly two or more individuals) notice something interesting. That interesting thing sparks an insight.

Here is what does not work:

  • Predefined and narrow objectives for deliverables.
  • Keeping people in silos
  • Asking the same questions (or even worse, asking no questions)

 4. A disruption life cycle exists

Steven Sinofsy points out that disruption has a lifecycle pattern:

In the first phase, the potential disruptor introduces a new point of view for achieving a task: it is generally a simpler stripped down product that might be at a lower price point. Although incumbents generally notice the new entrant, they offer only a tepid reaction. I should point out that we only know something is truly disruptive in retrospect.

In the second phase, the incumbent now notices the product but continues to compete in uninspired ways, claiming “here’s how and why we’re better.” The disruptor gains strength, and competes on more dimensions (for example, more than price). It is now an established competitor with a unique and evolving value proposition.

The third phase is one of a new equilibrium. The incumbent and disruptor have parity.

The end game, which may take many years, is where one of the parties retreats and/or one or both parties enter into a new “blue ocean” space to practice a new kind of disruption.

5. The strategic initiative leader and team have important responsibilities

Too often, strategic initiative leaders function as program managers tracking and following up on the projects and the deliverables, and communicating to the stakeholders. Sometimes they are even more aloof, simply acting as executive sponsors.

A strategic initiative leader needs to keep the incumbency-disruptor question high in awareness: which one are we? Another important question is one of patterns: are we seeing small put salient signals? Are we ignoring important things?

And, of course, the leader can’t do it all by himself or herself. The team of people who are in tune with the situation and who fell empower is also an important part of the pattern of disruption. We don’t know when disruption will strike.

Do you agree that disruption has patterns? Do you agree that the strategic initiative teams and leaders need to be alert for small signals?

Beginners Guide: Competent Strategic Initiatives

Do you want to become more competent in the arts of strategic initiative leadership?

I distinguish competency as a concept that holds a middle ground between being a novice and being an expert. Novices are still trying to learn basic concepts and are typically preoccupied with discovering best practices. A competent person can perform in a way that requires no “hand holding” by a senior person; they can structure and energize the strategic initiative with a sense of grounded confidence. Competent people understand the importance of the context, and pay little attention to best practices (because best practices typically only exist in the eyes of novices or people who want to see you something). Experts are those who push the boundaries of the filed (for example, write books or invent new ways of doing things).

The “conscious competency” model of learning says that we are first unconsciously incompetent: we don’t know what we don’t know. Then, we become consciously incompetent: we know that we don’t know. Then we are consciously competent: we know that we know something. (Confidence is an important element of the strategist’s perspective.) The ultimate stage is unconscious competence: we know so well that we don’t have to think about it.

That model is lacking for strategy work. The below model from Will Taylor is a better model, because it sets up a “learning journey.”

Will Taylor’s Five Stage Model

Taylor points out that

“one is inevitably ignorant of many things one does not know (i.e. we revisit ‘unconscious incompetence’ repeatedly or continually; i.e. ‘consciousness of unconscious incompetence’). Repeatedly, we are continuously rediscovering ‘beginner’s mind’.

Leaders of strategic initiatives always start out with some kind of useful knowledge. It might be in the industry, with project management techniques, or with strategy. They need to replace erroneous knowledge and add new knowledge as the move the strategic initiative forward. Many people are unconsciously incompetent. They don’t know strategy, they don’t know that a strategic initiative is a distinctive kind of program, they don’t know how benefits differ from deliverables, and they don’t know the tools of program management.

Here’s the applied part for leaders of strategic initiatives. Taylor writes,

“We revisit conscious incompetence, making discoveries in the holes in our knowledge and skills, becoming discouraged, which fuels incentive to proceed (when it does not defeat). We perpetually learn, inviting ongoing tutelage, mentoring and self-study (ongoing conscious competence). We continually challenge our ‘unconscious competence’ in the face of complacency, areas of ignorance, unconscious errors, and the changing world and knowledge base.”

Notice on the far right side the presence of “discouragement.” Most learning models don’t admit that people do get discouraged and revert to their old ways.  It’s a predictable milestone on the learning journey. And it’s an important leadership idea: the leader will occasionally feel discouraged, but so will the team members.

(Courtesy of Will Taylor, Chair, Department of Homeopathic Medicine, National College of Natural Medicine, Portland, Oregon, USA, March 2007. Please reference the diagram accordingly if you use it.) The source of the graphic and Will Taylor quotation is here .

The amount of things you need to know, and master, might seem a little overwhelming. This blog (in addition to my seminars) provides some excellent starting points for you. If you think you are missing some of the basics, here are a few articles and links:

  • Launching a Strategic Initiative? Here are Three Good Practices (follow this link )
  • The Purpose of a Strategic Initiative (follow this link )
  • Four Things Strategic Initiative Leaders Need to Know About Requirements (follow this link )

I encourage you to explore the many articles on this site. They will help you better understand strategic initiatives, program management and leadership. You’ll tools for turning vision into action.

Reflective Competence

The eye-catching part of the Will Taylor model is the large colored circle, titled reflective competence. As contrasted with formal, text-book oriented learning, reflection involves the learner mentally reviewing his or her experiences. Your reflection should be on these three areas:

  • Knowledge-in-action. How well did you apply knowledge? Perhaps, you failed to retain the knowledge to begin with, so you floundered.
  • Reflection-in-action. Were you aware of your own thinking?
  • Reflection-on-action. Did you apply the knowledge optimally? How might you do it differently the next time?

You can’t know everything there is to know, nor can your team members or sponsors. Yet, you’ve got to start with what you know: do you have “right knowing?” Examine your actions: are practicing “right doing,” with a conscious regard for harmonizing your actions with competent knowledge?

This article gives you a way to look at your own learning journey. How will you use it as an improvement tool?

Category: Forex

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