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Competing Through People
News & Views on Building Strategy-Capable Organizations
 
Keys to A Successful Strategy
Michael Couch, President
Michael Couch, President

  

It's that time of year again.  For many organizations, arrival of the fourth quarter means its time to review, update, or develop strategic plans. 

 

 Unfortunately, many companies are not pleased with their planning process and do not feel that it's worth the time invested.  This doesn't have to be the case. 

 

Here's some tips that can help make your process energizing and well worth the effort.

 

Protect the Plan 

No plan is perfect. No forecast is perfect. Every contingency can never be completely addressed. However, the right people and process can identify the potential threats to a plan, assess their likelihood and impact, and develop specific actions based on how likely the threats can be detected. This is like a Failure Modes and Effects Analysis (FMEA) for the Plan.

 

The same should be developed for the upside. What could potentially cause us to be above Plan and, if so, what can we do to try to capitalize on it?
 
Assure that the Organization is Capable
 
Once the strategy is developed, senior leaders must assure that the organization has the capability to handle the demands placed on it by the strategy.

The demand the strategy places on the organization must be assessed (i.e., What are the mission critical functions and capabilities, What are the pivotal positions?, What type of work culture does it suggest), the organization capability must be analyzed (i.e., Do we have the right people in the right roles doing the right things, Are we filling the talent pipeline, Does our culture support the strategy?) and any gaps addressed by a detailed organization development action plan (i.e., reorganize, recruit, key talent retention and development, culture change initiative).
 
 Use A Comprehensive Deployment Process 

 

For effective execution, the strategy and value drivers must be obvious to all key stakeholders. The best examples of this in action are in companies committed to Lean Manufacturing/Six Sigma. The Strategy Deployment techniques utilized by these firms assure a clear linkage from strategy to annual business plans to department/process objectives down to individual employee performance plans (What Toyota called the "catch ball" process). Key process and performance measures are prominent in all communications tools including company and process dashboards. Even the agendas for regular business review meetings are built around components of the strategy.

 

(Read more about Keys to a Successful Strategy)

 

The Right Time
   

Retaining talent is a hot topic after the engagement-challenging years we've recently experienced.  However, it would be a mistake in this economic climate to emphasize retention over the broader issue of employee productivity.  Improving productivity requires retaining the right employees in the right roles and assuring they are doing the right things.

 

The right employees are those who understand the business, drive change, build commitment in others, and consistently achieve results.  They have demonstrated that they are learning agile and have shown potential to take on broader scope or handle greater responsibilities. 

 

The right roles are the mission-critical or pivotal jobs that can have a direct impact on key business results.  Typically, pivotal roles are not related to organization hierarchy, equire unique skills that are scarce in the marketplace, and are not a large percentage of the employee population. Employees in these roles usually exhibit a wide range of performance - not everyone can do these jobs well.

  

The right things are the projects and objectives linked to key strategic priorities.  Employees need a clear line of sight between their performance objectives and the direction of the business.  Research shows that this linkage improves employee engagement - a key factor in retaining top talent.

  

Do you know which of your employees are right?  Where the right roles are?  Does every employee know the right things on which to focus?  If not, now would be a great time to find out.

 

The 9 Box - Used and Abused

 

"The nine-box category system is crude and clumsy." 

That's a quote from a professor in the UK on a system that is used by many companies to create a summary picture of their talent.  It is often called the Performance Potential Matrix (PPM) since performance and potential often make up the axes that form the box.

In general, I would agree with the learned professor.  For 90% of companies that us it, the 9 box is rude and crude.  However, its not the poor old 9 Box's fault! 

My experience is that the Box gets this reputation because not enough emphasis is placed on gathering data in an objective and reliable fashion.

We completed a study for a large retailer that compared the results of their executive assessments (full day of testing by third party), their internal 360 assessments, their performance reviews completed by managers, and the results of talent reviews that we designed and facilitated. (Click here to learn more about Talent Reviews) It just so happened that the results were summarized in a 9 Box that we call an Organization Capability Matrix. 

The results - The performance reviews and 360's were so skewed and truncated that the results were useless for decision-making. The executive assessments were rich but tough to interpret by managers and viewed as too costly.

In contrast, the talent review and the executive assessments were highly inter-correlated (those in the reviews were not privy to the assessment results) and both were the most predictive of future performance and advancement. From a "face validity" standpoint, the leaders preferred the facilitated talent reviews because the results were clear cut and the follow-up organization action plans were very specific. In addition, the process helped create a common language and leveled/calibrated the talent perceptions across the organization.

If you focus on the data gathering, the talent review with the simple 9 box summary can be a very effective, reliable tool. Even more, put the 9 box data in business intelligence software and you can answer almost any question about the capability of the organization through multi-dimensional slices'n'dices of the data.

In This Issue
Keys to a Successful Strategy
The Right Time
The 9 Box - Used and Abused
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