Great strategy but nothing is moving?

by Arjan Molenkamp | Jul 15, 2018 | Mastering Implementation and Execution

Great strategy but
nothing is moving?

Make a clear distinction
between What and How!

A couple of months ago, I attended an excellent strategy session. The entire executive team shared this excitement after realizing the potential they still had ahead of them. They could hardly wait to get into that brave new world that would benefit all of them! Towards the end of the meeting, the chairman, however, made it clear that the outcome was highly confidential as otherwise, competitors may soon know about the ambition and direction of the organization.

Management assumes ‘what’ and ‘how’ is clear

On Monday morning, staff came to one of the executives asking questions on how the session went as there was a lot of whispers on the importance of this meeting. She explained that it was very positive and highly inspirational but that at this stage she was not allowed to talk about it. Weeks went by and after approving the minutes of the meeting, an extremely watered down summary was shared with staff and nothing changed.
In my view, the crucial mistake that is being made here is that management assumes that once the ‘What’ question is clear, the ‘How’ question will automatically follow. That is however not applicable to competitors nor to employees so let’s have a closer look at two assumptions that probably need some correction.

A good strategy is leveraging on strength

The first assumption is that explaining to a broader audience ‘What’ the future organization will look like, will allow competitors to get their quicker. This logic can be doubted as a good strategy is leveraging on unique strengths and should therefore not be that easy to copy. It also assumes that the competition will not have their own strategy session and just copy-paste whereas in reality they probably want to be different and develop a distinctive proposition. The biggest mistake, in summary, is the assumption that explaining the ‘What’ also gives a clear roadmap on the ‘How’ which is never the case.

Employees need to understand the strategic direction

The second assumption is that employees can get inspired and have a clear picture on ‘How’ to change and develop without even knowing the ‘What’ of the strategy. Even more than executive management, employees need the inspiration that comes from a well communicated clear and appealing strategy. If they do not see the purpose, understand what their benefit will be or get an idea how they can contribute, then it is very unlikely that they will buy-in. Employees need to understand the strategic direction to know what is expected and be able to to see for themselves how they can contribute.

As a result of poorly communicating the strategy, many organizations have missed the opportunity to create staff-excitement, getting their buy-in and ideas for implementing the strategy which could, in the end, result in a failed strategy implementation. It is the responsibility of management to explain what the long-term strategy means for the organisation for over 10 years, in 3 years and even what it should like in the next 12 months. Once this What question is clear and endorsed, staff should immediately be involved in coming up with some ideas on the ‘How’ of implementing the short-term strategic goals. Empowerment is allowing people that have to do the work to give input on how the work should be done.

Implementing is as important as developing

Developing a strategy is important but it is recommended to agree upfront on how implementing the strategy will take place even before developing the strategy. It’s not efficient to give a lower priority to the implementation or to assume that people that were not present at the strategic meeting should take ownership for implementation without proper engagement. Once an organization realizes that the ‘What’ question can be filled in by Management but the ‘How’ question always needs engagement with employees, much faster implementation of new strategies and new developments can be expected.

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Raising the bar by pushing for perfection?

by Arjan Molenkamp | Apr 12, 2018 | High-Performance Organisation

Raising the bar
by pushing for perfection?

Pushing hard is not efficient
so use iterations instead!

‘Good is not good enough’ and ‘You’re only as good as your last results’ are common management phrases indicating that the bar will be raised again and again. Whereas it may be good to stretch employees both for personal development and revenue/profit, it may become counter-productive if a manager starts stressing people instead of stretching. I have personally most felt such an aggressive push to raise the bar during budget negotiations. Even when I thought that I already showed quite some ambition to aim high, it always seemed to be too low. Top-management wanted to make it look like that the budget approach is ‘bottom-up’ whereas in reality, they already have an idea on the numbers they want to see. As a result, a lot of effort is wasted by lower management to come up with a proposal, thereafter still being overruled. Giving the mandate and then withdrawing the mandate, can ruin the whole intention of developing ambition and taking ownership at lower levels.

Stretch but not too far

This kind of top-down push may also result in other side effects. It could be that in the next budget cycle, employees and lower management will make sure that their first proposal is as low as possible to create a better negotiation position, by putting more emphasis on threats rather than opportunities. A forced commitment could also result in staff just pushing the numbers for the sake of pushing the numbers not bothering about sustainability or risks. Raising the bar could thus in both cases have a negative impact on long-term sustainable performance. The question is therefore how to stretch but not stress employees to avoid this kind of resistance? How can managers improve good performance while increasing staff involvement?
Before I will answer these questions, I will share some examples of a completely different approach to increase results based on my personal experience when attending a strategy session. It was already pretty special to participate in a strategy session as mid-level manager as most companies perceive strategy development as a highly secretive, very exclusive job for the very top of the organization. Later on, top-management wonders why the strategy is not working, only then realizing that not all relevant aspects have been taken into consideration and low involvement resulting in poor acceptance by lower levels. Asking management and staff ‘below’ for their input and engaging them in the strategy development process can have created a better strategy that will have more support and ownership throughout the organisation.

Apply iterations to improve the outcome

There were also some other valuable insights that I gained during the strategy session that proves that working smarter is more effective and fun than working harder. The organizers of the session explained that the whole process during the session would be based on iteration. Research has shown that stretching becomes harder when approximately 85 % of the perfect outcome has been reached ( ‘the law of diminishing returns’). The last 15 % for reaching 100 % could be as a hard as getting to the 85 %-level. Instead of pushing harder, and harder, striving for perfection, we had to apply iterations to improve the outcome. That implies that we had to aim for 85 % of the goal in a relatively short timeframe. Thereafter the direction would be adjusted with a new assignment again aiming for 85% of the perfect solution. This is similar to ‘sprints’ in ‘agile-working’ as in both cases the goal is not to develop the final perfect solution but rather some tangible outcome that can be tested and used for further improvement.

During the strategy session, we already made a number of these steps when we reached the phase where we had to simulate a presentation of the plan so far to the Board. The group was split into three teams, each having to deal with different requests from the Board; The first team was challenged to see what could be done if the Board would double their budget; the second team was asked to see what could be done if the Board would cut their budget by half; and the third team got the challenge to see what could be done with the budget as requested but in 6 months instead of 12 months. It was interesting to see that different assignments for improvements could have such different results. The team that got additional money lost track as they started fantasizing about the wildest ideas; the team with money constraints, started threatening to kill the most important projects in some kind of revenge but later came up with some good ideas; the team with time constraint was able to further reduce activities and was most focussed on short-term delivery. There is no right or wrong here but the observation is that different assignments could strengthen the outcome in different manners. The process of iteration creates a new impulse for additional input on the available strategic options.

Change the approach good progress has been made

After incorporating these new insights, we moved to the next round of iteration. This time we had to simulate a town-hall presentation to all staff as presenting the strategy is a crucial step in implementation. If the presentation is not crisp and clear or fails to create some excitement than it is not likely that executing the strategy will be quick and smooth. So we worked hard on the presentation making it clear what the positioning, the segmentation and the proposition were considering macroeconomic developments. While we were busy with the preparation using all these fancy business-buzz words, the workshop organizers warned us that the audience to assess the quality of our presentation was extremely capable to give direct feedback on the clarity and excitement of the presentations. We did not worry too much as we believed that we were well prepared with our power-points slides and beautiful graphs… But then they brought in a group of children between 10 and 12 years old! You can imagine that this iteration step resulted in quite a drastic review of our presentation as this critical audience felt that our presentation was not excited nor clear and they made it very clear that they were bored until we could visualize how the experience of engagement with our organisation would become much more exciting.

So how to make sure that employees do not show resistance for stretching? It is recommended to change the approach a bit after some good progress has been made rather than repeating and pushing for perfection. This can be as easy as changing the goals or the conditions a bit. What can we do more, better or different when it comes to the end result? Or could it be that we that we can challenge ourselves by imagining what we would do with fewer resources? It is quite remarkable that less can create more as the strategy workshop showed that getting less time to execute the strategy brought the biggest improvement in drafting a strategy that works!