Why strategy execution is life or death at the moment
In a forgiving economic climate (remember that?) you can get away with the fact that, on average, 50% of strategy fails to get delivered. But, in an unforgiving economic climate (ah, sounds more familiar) if everyone and everything is not focused on delivering your core strategy, then you are in trouble. That’s assuming your strategy is a sound one, of course. But, that’s a different subject.
So, here’s the one thing you need to know to maximise strategic execution (i.e. making sure what gets done throughout the organisation is directly geared towards your core purpose, with no wasted effort and resources at a time when you can’t afford any).
The one thing…
Booz & Company consultants collected survey data for almost five years from more than 125,000 employees of 1,000 organizations in over 50 countries.
From this data they distilled - and ranked in order of importance - the top traits exhibited by the organizations that are most effective at executing strategy.
The single most common attribute of such companies is…that their employees are clear about which decisions and actions they are responsible for.
Source: The Secrets to Successful Strategy Execution, Harvard Business Review, June 1, 2008
Book by end of Friday (tomorrow): Last chance to save up to £400 on learning how to put strategy into action from the phenomenal lineup of leaders at Leaders in London. Click on the link and book before Friday October 31st.
‘Storyteller’ posted this as a comment on the Warren Bennis post, below. It’s such a great observation, and the comments aren’t publishing for some reason, so I’ve put it here as a full post for the rest of us to benefit from:
Storyteller writes:
“Warren has a good point. But after a lot of reading on the subject, I happened across Peter Drucker’s take on leadership in the context of what makes an effective executive. After 65yrs consulting with some the best executives, he says they are all over the map in terms of personalities, strengths, attitudes, values and weaknesses. He says that what made them all effective executives is that he realised that they followed the same 8 practices:
They asked: “What needs to be done?”
They asked: “What is right for the enterprise?”
They developed action plans.
They took responsibility for decisions.
They took responsibility for communicating.
They were focused on opportunities rather than problems.
They ran productive meetings.
They thought and said “we” rather than “I”.(Meaning that they have authority only because they have the trust of the organisation.)
The first two practices gave them the knowledge they needed.
The next four helped them convert this knowledge into effective action.
The last two ensured that the whole organisation felt responsible and accountable.
He added another practice and one which he elevated to the level of a rule “Listen first, speak last”.
Some people are born effective, but demand is much too great to be satisfied by extraordinary talent. To do that requires discipline and like every discipline, it can be learned and MUST be earned.
His summary was that for all their differences, effective executives “get the right things done”.
Hence no need to separate the leader / manager - the true leader sees what needs to be done and ensures it gets done - so to paraphrase Warren and Drucker, you can’t manage your way out, you have to see the way out.
Obama, according to Kevin Eikenberry’s leadership competency test. He beats McCain on ten out of the twelve core leadership competencies and is within 1.5% of him on the other two. 750 people rated the two contenders in the test. I’m assuming Kevin took their political views into account somehow in conducting this survey. Here’s one of the key slides:
You can download the complete report here (he asks for your email address).
OK, I normally pour scorn on the ‘Are you a leader or are you a manager?’ question, as you have to be both. they are different modes, not different people. But, Warren Bennis, in ‘On Becoming A Leader’, captures my attention with the opening distinction here, which reinforces the fact that you need to lead your organization to succeed through the downturn: you can’t manage your way out of it.
“I tend to think of the differences between leaders and managers as the difference between those who master the context and those who surrender to it. There are other differences, as well, and they are enormous and crucial:
• The manager administers; the leader innovates.
• The manager is a copy; the leader is an original.
• The manager maintains; the leader develops.
• The manager focuses on systems and structure; the leader focuses on people.
• The manager relies on control; the leader inspires trust.
• The manager has a short-range view; the leader has a long-range perspective.
• The manager asks how and when; the leader asks what and why.
• The manager has his eye always on the bottom line; the leader has his eye on the horizon.
• The manager imitates; the leader originates.
• The manager accepts the status quo; the leader challenges it.
• The manager is the classic good soldier; the leader is his own person.
• The manager does things right; the leader does the right thing.”
Reminder: Reserve your place at Leaders in London by the Friday of this week to save up to £400.
So, we are in tough times. We need every day heroics. From you and from the people you lead. It’s a big ask, you might think. But, as David Beckham points out in this clip, tough times can bring out the best in all of us. Click on the small triangle at the bottom left to view the clip.
For more on how to lead through a downturn, from a powerful panel of leaders, take a look at the Leaders in London Summit, which takes place at the end of next month.
In the current climate there’s no room for lack of clarity. People talk about ‘leadership’ with a whole range of meanings in their heads, most of them out of date. It’s leadership that will navigate you through the downturn and increase your performance as an organization by, on average, 15% (according to Warren Bennis ‘The Dean of Leadership’, The FT). So, get clear yourself on exactly what good leadership is and make sure your managers and people know it too. See below for some help.As for me, I’m with the US Army on this one (see below).
Warren Bennis:
“Leadership is like the Abominable Snowman, whose footprints are everywhere but who is nowhere to be seen.”
Dwight Eisenhower:
“Leadership is the art of getting someone else to do something you want done because he wants to do it.”
Daniel Goleman:
“Leadership is the act of getting something done well through the actions of others.”
The U.S. Army:
Leadership is “Influencing people- by providing purpose, direction, and motivation- while operating to accomplish the mission and improving the organization.”
Yep, I’m definitely with that last one. At the moment, that’s the challenge facing everyone. What about you. How do you finish the sentence ‘Leadership is…‘
Hat Tip:David Hasenbalg, over at The Leadership Hub, provided the definitions.
Well, our adopted Formula One race team here at Leaders in London, McLaren, won again in the Chinese Grand Prix over the weekend. That leaves Lewis Hamilton having to finish in the top five in the Brazil Grand Prix in two weeks’ time to win the Drivers’ Championship.
Then we’ll know if Ron Dennis, the Vodafone McLaren Mercedes Formula One team principal, will be coming to talk to Leaders in London at the end of November with the championship under his and McLaren’s belt.
I used to write newsletters for McLaren and one of the things I remember from that is the incredible competitive pressures they work under - the difference between a winning and losing performance can be fractions of a second per lap. The race to get the car absolutely right in between races is as fast and furious for the people in the McLaren factory as the race on the track every two weeks. And just as critical for success.
The economic environment we are all now in means our operating conditions are as unforgiving as theirs. Where we are focusing on shaving every ounce of unnecessary expenditure off our budgets, they are constantly working to shave every ounce (sorry, gram) of unnecessary weight off the car. The driver helps here, as an aside, by losing a pound (half a kilo) or more of body weight in each race, as the physical exertion of navigating the half ton car around the track is like running a half marathon.
So, what better time to learn from Ron Dennis how to lead in unforgiving conditions, how to create and maintain a world-beating team in the harshest of competitive environments? And if you book by end of this month, you save up to £400 on the summit attendance fee. End of plug. Here’s the summit link if you want to find out more and book online or by phone: Leadersin London
For most of us your company story has to change right now.
I’m reading Christopher Booker’s ‘The Seven Basic Plots: Why we tell stories’. He says there are, as you can tell from the title, just seven basic plots to all stories. While you look at his list of the seven plots, think of your ‘company story’ and which of these it fits most clearly into. (What do you mean ‘we haven’t got one?’ Every organization that wants to go somewhere, that wants its people to be engaged and motivated, has to have a story it tells about itself - who we are, where we are going, why we come into work each morning). Here are Booker’s seven plots:
1. Overcoming the Monster
2. Rags to Riches
3. The Quest
4. Voyage and Return
5. Comedy
6. Tragedy
7. Rebirth
Your corporate story might have been ‘Rags to Riches’ or the pursuit of power (traders and investment bankers), it might have been ‘The Quest’ or the mission, like Harley-Davidson’s “motorcycles by the people for the people”. It might have been ‘Rebirth’ if you are going through a merger or acquisition. But, whatever your story was, you need to adjust it now. Not lose it completely, just adjust it.
For all of us now, the primary story is ‘Overcoming the Monster’.
Now, some would say ‘the Monster’ is the tough trading climate, the impending (or for some, the actual) recession. That’s the story you need to unite people behind, because they are feeling unsettled and powerless in the face of it.
I’d say that’s part of it. But, as we all know, the danger is that in fighting the monster, you become the monster too. How you behave and act as a leader in tough times dictates whether you will engage your people (and I am aware that part of what some of you have to do is let people go, so your ‘remaining’ people, perhaps) to fight the monster.
Or, you can treat people as expendable, put on your hard face, slip into ‘tough times demand tough leadership’ cliche mode, and wield the axe where you can - Cutting what’s easy to cut rather than involving people in working out what’s smart to cut. Once you start doing that, for many on the outside, you’ll be looking monsterish yourself.
What do you think? How should you lead through the current downturn?
It’s quite likely that you have spent the past couple of weeks furiously adjusting corporate priorities to take account of the drying up of credit. It’s quite likely that your focus over the past couple of weeks is cost-cutting measures. So, how do you lead in a way that focuses people sharply on these new priorities?
Core strategic purpose
One proven approach you can try is to sharpen the focus of individuals and of teams, to ensure everybody is pulling hard in the same direction. This helps people re-prioritise, putting to the back burner ‘nice to haves’ that they may have been working on, and redoubling efforts on core strategic purpose.
Here’s a quick exercise to help you achieve this sharpened focus. Joseph Weintraub, a professor of management at Babson College, suggests you review performance by writing down the three most important things a manager or other individual gets paid to do, obviously focussing on the things that the organization needs to do to execute your current strategy.
Reality check
Then you ask that individual to compile their own list of three most important things that they do. And you sit down and compare the lists. “In the majority of cases, the lists look dramatically different, with a ‘hit rate’ of about one out of three expectations in common,” Weintraub says in the Harvard Management Review Update. You can then align expectations more clearly, with the individual themselves, to sharpen the focus on ‘doing the right things’ and help eliminate or reduce work that isn’t sharply focussed on delivering the strategy.
You can try the same exercise with a team: get the team to come up with the three most important things they do to deliver value to the company, then analyze that with them and, with their input, adjust as necessary.
Scale up
Finally, you can scale this approach up if you run a large organization, with a leadership memo reminding everyone of the three core objectives of your current strategy, and how vital it is that everyone focuses on delivering these objectives in their work every day.
Don’t forget yourself
I’d add one thing to Weintraub’s advice: people feel ‘done to’ in an economic downturn; that their span of control is eroded. To ensure this is a collaborative approach that they buy into, don’t forget to ask in your one-to-one interviews for their view on what the three most important things are that you, personally, and the company should be focussing on at the moment.
Then you tell them what the three most important things are that you are ACTUALLY focussing on at the moment. Then, have a discussion to find common ground. You may get useful feedback to focus current strategy on what needs to be done. Or you may get the opportunity to explain why the three priorities you have at the moment are critical, which helps to show that you are going through the same focusing exercise as them.
How long does it take to sharpen focus?
Psychologists reckon it takes around seven weeks to break old working habits and establish new patterns, so assume that you need to get the individuals and teams and their managers to monitor any changes in focus for two months, to ensure direction is being maintained without slipping back to pet projects or other distractions.
So, you’re shut away in your office, in conference calls, in meetings, racing around with an urgent look on your face. Who wouldn’t be as we all have to adjust fast to the credit crisis? But, I just want to remind you that now is the time to slow down and walk like a leader.
I interviewed the CEO of a global organization on Friday. I found him inspiring. Among other things he told me this:
“I was in a meeting in my office with a colleague. She’s going to be a real star and a great leader. When you think people are great, tell them, and always tell them how you think they can be even better. I told her:
“‘You’re going to be a great leader, but watch one thing: you’re always rushing everywhere, looking at your Blackberry, consulting your notes, you’ve obviously got important things on your mind. You’re focussing on ‘the work’ and forgetting that people are the leader’s work. Look up and connect with people. Look them in the eye. Really connect. Do it when you walk. I’ll show you what I mean.’
“We walked down to the canteen for lunch at her speed - fast, urgent, no time to waste. ‘Now, we’ll walk at leader speed’, I said to her on the way back. We walked slow, acknowledging people and stopping to chat half a dozen times.
“It took five times as long to get back. But, we connected half a dozen times with people at all levels of the organization. We chatted about sport, bits of work, all kinds of things. We walked back into my office better connected than when we walked out. And the people we spoke to knew that we weren’t rushing from them to something important. They were the something important.
“I always say to people, think of how slowly Nelson Mandela or Bill Clinton walk to a lectern to give a speech or walk around talking to people. Even when he was young, Mandela didn’t rush. He’s always walked at leader speed.”
So, there you go. Your challenge this week is to stop rushing around importantly and walk at leader speed. You set the tone. How you keep communicating and connected with people is as important in these uncertain times as what goes on behind those closed doors. Tell them as much as you can. Over-communicate. Don’t retreat into a decision-making shell that people feel excluded from. You’ll lose their commitment to what has to come next if they feel excluded from the decisions they are asked to carry out.
The CEO I interviewed is coming to Leaders in London to talk to us from the stage. I haven’t yet checked with him that I can put his name to this story - he didn’t tell me the story for attributed publication - so I’ll add his name in later if he’s happy with that.
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