sam tsima cometsa group

ALIGNING BUSINESS STRATEGY,

TRANSFORMATION & ORGANIZATION

CULTURESAM TSIMA COMETSA METHODS

24th June 2010

The Conference Hub

04/12/2023 04:56:02 AMAligning Business Strategy 2

WHY STRATEGIC INITIATIVES FAIL?

Top five reasons why strategic initiatives fail (ref. Six Disciples – Strategy Execution Coaching)

Strategy not clearly communicated to the stakeholders (Lack of and/or poor Communication)

Lack of support by key leaders in the organization (Lack Leadership commitment)

Decision-makers do not understand the Relevance or are unable to measure progress (Lack of Clarity and Measurements)

Lack of impact of employee compensation (Lack and/or Poor Reward & Recognition & Business Strategy Alignment)

Technology needed for implementation is not available (Lack of Capacity/Resources)


CRITICAL ISSUE IN 2010

For the 20 years that consulting firm i4cp has been conducting research, leadership development has always been a top issue.

In their 2010 research study, however, leadership development has increased in prominence, with a surprising 75% of organizations citing as an important issue.

Other key findings:

Only 23% said they were effective at developing leaders internally – a gap of 50%


CRITICAL ISSUE IN 2010, CONT.

Only 14,3% of high-performance organizations have a process for identifying gaps in leadership development.

Only 25% of the study’s respondents said leadership was effective at managing change, yet 74% said change management was important.

Strategy execution and alignment was another area of concern. Though 79% of respondents said aligning the workforce to business strategy was important, only 33% said they were effective at doing so.


WHAT IS THE BOTTOMLINE?

“Companies should be treating leadership development as both an urgent survival tactic and a business opportunity. The companies that get it right – and several high – performing companies are doing it right already – have potential for great success.”

What defines High-Performance Organization?


HIGH PERFORMANCE ORGANIZATION

What is a high-performance organization?

The exemplars of successful businesses

They represent real world models of a modern managerial ideal: organizations that excel in so many areas that they consistently outperform competitors for extended periods of time.


BECOMING A HIGH – PERFORMANCE ORG

Companies that excel in the following five key human capital domains are more likely to outperform competitors, engage employees and realise line impact (ref: i4cp’s):

Strategy: an organization’s human capital must be aligned to the business strategy so that every employee is focused on the same goal.

Leadership: leaders must communicate performance expectations, develop and promote the right people and convince employees that their behaviours are critical to success.


BECOMING A HIGH – PERFORMANCE ORG, CONT.

Talent: HR strategy must be developed around the business model to ensure that the proper human capital components are put in place to drive business value.

Culture: The values and beliefs at all levels and in all departments must be aligned, and existing and future leaders should be role models for this culture

Market: every employee in the organization should understand the market place and customers; and should know how his or her job impacts business results

Delivery vehicles: Peers, Research, Tools and Technology

STRATEGY – LEADERSHIP – TALENT – CULTURE - MARKET


COMMUNICATE ORGANIZATION GOALS OR ELSE

According to research commissioned by the UK’s Department for Business, Innovation and Skills, only 24% of employees know their firm’s goals for 2010.

Other key findings: 32% even doubted there was a plan for their business at

all

Only 27% of people said they were fully prepared for the challenges they would face at work in the years ahead

NB: Poor employee engagement can put the brakes on improved business performance. If leaders don’t explain where the business is going and what it is seeking to achieve, how can people be motivated or know what they are meant to contribute?


CLEAR GOAL SETTING

Clear goals are a key ingredient for achieving performance and productivity – but worryingly, this research suggests many employers have not yet grasped this.

Renew your organization’s mission, vision, shared values, strategic position, create a short list of vital few objectives, and put together a list of things to stop doing

Develop a strategic plan that outlines a short list of key initiatives that will drive activity toward meeting those objectives. Assign responsibility, key targets, outcomes, and create measures to track progress.


CLEAR GOAL SETTING, CONT.

Communicate the results of points 1 and 2 above to everyone in the organization – in multiple ways, on multiple occasions. (That means two way communication, which includes listening)

Align the organization’s resources (people, technologies, processes, policies, measures) to support these initiatives.

Have each person in the organization develop an individual plan of activities for the quarter, which align with the key initiatives they are working on. Hold short status meetings with team leaders weekly to track progress, to identify areas of risk, and provide enough time for continual course correction.


CLEAR GOAL SETTING, CONT.

Measure results quarterly (not activity), review individual performance (and use 360 feedback surveys), survey stakeholders’ satisfaction regularly, and review internal strengths, weaknesses, and external opportunities and threats.


CHANGE THROUGH CONTINUOUS IMPROVEMENT

The Ten Step Method to Continuous Improvement (recommended by Skip Reardon in Strategic Planning Society)

Continuous Improvement is a type of change that is focused on increasing the effectiveness and/or efficiency of an organization to fulfill its policies and objectives. It is not limited to quality initiatives.

Improvement in business strategy, business results, and customer, employee, and supplier business relationships can be subject to continual improvement


THE TEN STEP METHOD

1. Determine current performance

2. Establish a need to improve

3. Obtain commitment and define the improvement objective

4. Organize the diagnostic resources

5. Carry out research and analysis to discover the cause of current performance

6. Define and test solutions that will accomplish the improvement objective

7. Produce improvement plans which specify how and by whom the changes will be implemented

8. Identify and overcome any resistance to the change

9. Implement the change

10. Put in place controls to hold new levels of performance


EXECUTING STRATEGY

Brian Lassister, President of the Minnesota Council for Quality, posed the age old question: “Why is executing strategy so difficult – especially during today’s tough economic conditions, when strategy is really so paramount?”

He sites a recent study by Minnesota – based Digineer in which they found:

69% of the leaders surveyed are not confident in their organization’s ability to execute strategy

When responding to the question of what was the number one barrier to effective executing their strategy, most barriers reported were INTERNAL issues, not external factors. Top two: (i) company culture; (ii) past habits


EXECUTING STRATEGY, CONT.

All contemporary methodologies for implementing strategy (Balanced Scorecard, etc.) really have five common elements:

1. Focus on a few critical strategic goals

2. Identify key performance indicators that measure progress toward those goals

3. Assess initiatives against a screen of strategic effect and cost benefit

4. Execute programs that deliver the benefits

5. Review progress against Key Performance Indicators targets in real time and adjust course quickly when necessary


WHAT IS THE BOTTOMLINE?

“In challenging times (and really in all times) a key role for leaders is to set and execute strategy – to set a vision for the future and align organizational resources to move (and adjust) toward that vision.

The good news is that these internal factors can be addressed by senior leaders.

The bad news is that they are the same internal factors that have been identified in multiple other studies on this topic for years.


CONCLUSION: CURRENT CRISIS

Companies at Crossroads. Step Stones talent report written in co-operation with the Economist Intelligence Unit

Many businesses are now at cross-roads when it comes to talent management: they can implement success strategies that created and develop global talent pools; or they can choose to ignore the warning signs and risk experiencing an erosion in talent that is likely to result in sustained underperformance.

After two years of cost cutting, trust between staff and management is low

There is increasing evidence of talent drift – as most capable employees head to new jobs elsewhere

Business and organizations must concentrate on people and on their business talent, and do so urgently.

Sharp falls in graduate and entry-level recruitment threatens to create a “perfect storm” for companies

A lack of talented, motivated staff will mean that organizations will find it difficult to implement successful recovery strategies