Category Archives: Best Practices

Successful Strategy Development and Execution: Getting it Right the First Time

As per last week’s series on “What is Strategy? And How is It Obtained?” (parts I, II, III, and IV) and the last two posts on The Secrets to Successful Strategy Execution and Successful Strategy Execution is More Than Lean or Six Sigma, successful strategy development and execution is within the reach of every organization, and there are a number of toolsets that can be brought to bear to streamline development and execution once the basics are understood. However, the real key to avoiding false starts and getting it right the first time is to bring in an external sensei (which, literally translated, means “one who has gone before”) to guide the organization through the process.

Let’s face it, while it is easy in theory to come up with a vision, conduct a gap analysis, create an execution plan, streamline the plan with best practices, acquire the necessary tools and resources, and define the decision rights, information flows, and organization chart that will pull it all together, it can be very challenging in practice — especially if the organization has never done this before. Without a guide, the organization might not even be able to define an appropriate vision. Let’s face it “we will be the most progressive company in our vertical, by providing high quality, customized services to our customers, achieving a measurable difference of success for our suppliers, rewarding the excellence of our employees, and ensuring the long term prosperity of our shareholders“* is not a vision. It is a meaningless collection of buzzwords that’s on par with the drivel created by the Auto Joe-ks Mission Statement Generator that will only result in employees having a good joke at management’s expense as they say “Yeah, right! Who do the nincompoops think they are trying to fool? This is as likely as a monkey flying out of my butt!” After all, it doesn’t pass any of the sniff tests (outlined in part IV). It doesn’t specify what the organization is going to do, where it is going to do it, or why this will help the organization succeed.

Furthermore, it will be hard to conduct a gap analysis if the organization does not know how to define a successful representation of an organizational structure that is aligned to the strategy. Without an expert who knows what an appropriate structure looks like, and how to define the gaps between the current structure and the desired structure, the effort could grind to a halt. Then there is the issue of streamlining the structure, process, and execution plan. This will require someone who understands the core tenets of Lean, Six Sigma, or the foundational Toyota Production System, as well as Business Process Modelling. And the organization will be challenged to select the right tools and resources if the organization doesn’t fundamentally understand what the tools and resources have to do in order to enable the new organizational structure that is required. Plus, the entire effort can break down entirely when it comes to deciding decision rights when mangers mired in traditional mindsets will fight for rights they should never have had and should never, ever, want! And, assuming the organization is able to appropriately divide the decision rights, it might still be stumped on how to define, and enable, the information flows.

That’s why the ultimate key to getting it right the first time is to bring in an experienced guide to lead, moderate, and run the process. An experienced, analytical, and impartial guide will help the organization:

  • focus on constructing a buzzword-free vision that defines the what, where, and why in a manner the employees can truly and whole-heartedly get behind;
  • define a high-level end-state that specifies the who, what, and when;
  • conduct a meaningful gap analysis;
  • develop a process-oriented action plan that will get the organization from its current state to its desired state;
  • select the appropriate methodologies to streamline the processes;
  • identify the right tools and resources to meet the streamlined process needs;
  • categorize the relevant strategic and tactical decisions that will need to be made and assign them to the appropriate personnel (who are affected the most by them and who can generate the most effects from them);
  • streamline the required information flows;
  • create the appropriate organizational chart; and
  • identify the incentives that will have the most impact.

Furthermore, considering that, relatively speaking, consultants are cheap, there’s no reason for an organization not to hire a guide. It just make sense. Why stumble up the mountain when a guide can lead an organizational climber safely to the top?

*So, needless to say, the “leading” Canadian Broadcasting company that decided that it’s vision was to be the most progressive broadcasting company in Canada, by providing high quality, local service to our listeners, achieving a measurable difference for our advertisers, rewarding the excellence of our employees and ensuring long term prosperity of our shareholders wasn’t on the right track … or anywhere close to it!

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A Quick Guide to Crisis Management

A recent article in the CPO Agenda on what to do “when the CPO gets a request for quote” had a great guide on what you should to do when responding to a crisis that is worth a quick review. The five simple steps it put forth can mean the difference between a minor disruption and a major crisis. Simply put, these steps are:

  1. Consult the PlansSpecifically, consult the internal response plan and the external communications plan. Then contact the communications team, who should be clearly listed in the communications plan, to update them on the situation, even if their services might not be required (which will be the case if you can catch and fix an issue before the product reaches the customer).
  2. Arm Yourself with the Relevant FactsWhat really happened? When? Where? Why? and How? (Who is irrelevant as you will have to take full responsibility.) Investigate until you have the answers, don’t make any statements based on guesses or unconfirmed information, and don’t be emotional when you make your report.
  3. Don’t Comment Publicly Without Being Briefed FirstIf the products have reached the customer, or if the media has gotten wind of an internal issue and makes an inquiry, don’t respond without first reviewing the communications policy and contacting the communications team, and, if there are any legal implications, the legal team too. Even if you are the most qualified person to respond and have all the information, if you phrase something in a manner that could be misinterpreted, you could put your company in jeopardy.
  4. Assess the Situation for What it Really IsSometimes it will just be a boy crying wolf in your organization when all it is a utonagan. Furthermore, as Rod Clayton of Weber Shandwick notes, you could be in danger of attaching more significance to a situation or comment and making it worse if you can’t apply good judgment on whether it poses a substantial risk or threat.
  5. Takes Steps to Address the IssueWhen something does go wrong, the company needs to take strong, decisive and corrective action, the details of which will of course depend on what the problem is. And if the product has reached the consumer, the action needs to be quickly and clearly communicated to the stakeholders, media, and public. In doing so, the company will need to show leadership in facing up to a challenge and working to solve it. After all, the public will often forgive a company if they feel it has acted well in trying to address the issue.

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Successful Strategy Execution is More Than Lean or Six Sigma

As per Sourcing Innovation‘s last strategy execution post, which outlined the secrets to successful strategy execution, successful strategy execution requires clear-cut decision rights and information flows, as per Neilson et al., and good business process mapping. Lean is not enough. Six Sigma is not enough. TPS / Operational Excellence is not enough.

While these are very useful methodologies — as they can be used to streamline processes and operations once the organization has mapped out its current processes, identified the gaps, and developed revised processes that it believes will get it to where it needs to be; they are not vehicles for strategy execution in themselves. The very definition of lean is to eliminate waste from a process. That means an existing process is required as a starting point — lean can’t be used to develop a process from scratch. Six Sigma is a management strategy designed to improve the quality of process outputs by identifying and removing the causes of defects and minimizing variability. That means that, by definition, it also requires an existing (or proposed) process as a starting point. The Toyota Production System, the precursor to lean — which a few companies have rebranded “Operational Excellence” in light of the recent Toyota scandal, was a system developed to design out overburden (muri) and inconsistency (mura) and eliminate waste (muda). Again, the assumption is that there is a starting process.

Business Process Mapping is very straight forward, and there are a lot of free resources to be found if one searches for “business process mapping” or “business process modelling“. In addition there are a number of tools — such as flow charts, flow block diagrams, control flow diagrams, Gantt Charts, PERT diagrams; modelling techniques — such as functional modelling, data modelling and information modelling, and simulation modelling; and platforms — including workflow and BPM that can be used to assist the team. And it doesn’t matter which one the team selects — as long as everyone on the team understands it. The whole point of the exercise is to develop a representation of what the business is, and where the organization wants to go, that can be easily understood by everyone on the team and form the foundation of an action plan to get there. If the organization consists of mostly mathematical geeks, it can use directed acyclic tesseracts. It really doesn’t matter.

Strategy execution comes down to four essential elements:

  1. Have a clearly defined strategy. If it isn’t immediately obvious to an average high school student, it’s not clear enough
  2. Have an action plan to get from the current state to the desired state. Goals are not enough.
  3. Have the tools and resources in place to implement the plan. Make sure there is a process (such as lean, six sigma), process support (in the form of new systems and tools), and people ready to go (who must be given access to the support resources they need and trained in advance).
  4. Have the decision rights, information flows, and organizational chart clearly defined.Everyone must know what decisions are theirs, who they get data from and who they provide information to, and who they go to for guidance if a request requires a decision they do not own.

That’s it in a nutshell. It is within the grasp of every organization.

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Don’ts for Procurement Leadership, Part II

A recent article in the CPO Agenda had some good “Dos and Don’ts of Procurement Leadership” that are worth repeating. Today we’re going to dive into the other five don’ts and put an SI slant on them. DON’T:

  • Wish for a Quiet LifeNot only do you have to constantly evangelize the benefits of your procurement, but you have to be in the thick of it day in and day out. After all, any job that’s too quiet is probably on the way out. (You don’t want to be this guy.)
  • Ignore the Power of Networking EventsEven though confidentiality and non-disclosures may prevent your colleagues from sharing all the details of their challenges, you can still get the pulse of what the hot button issues are and what your colleagues are trying to do to address them. You might learn about new processes or (software) solutions that can help you with your job.
  • Ignore TalentAs per our last post, your people are the ultimate key to your success. Nurture their talent and do what you can to attract more talent to work for you. After all, there’s nothing wrong with not being the brightest bulb in the box when it comes to execution when you’re measured on organizational performance. Your analysts should have better data skills, your negotiators better sales skills, and your relationship managers can have a higher EQ. You’ll never be replaced if you’re the one with the best leadership skills who can serve as the glue that can hold the team of chefs together and convince them to work towards the common good and not their own personal goals. (Well, at least not if your boss has any brains at all.)
  • Miss Your Key ResultsYou have to deliver what you promise, plain and simple.
  • Be ArrogantYou should be extremely confident in your abilities to deliver world-class performance, but you shouldn’t step over the line. You’re still the new kid on the block, so you need all the help you can get.