RT @boardeval: RT @boardeval: See the FRC 2016 corporate governance review at our website https://t.co/vKv91G0Xvu Interesting reading!!

Great in practice but will it work in theory?

Jean Pousson looks at typical killers of strategy implementation

The above quote (attributed to Madeleine Allbright, Bill Clinton’s Secretary of State) is but one example of where executives know what the strategy is, they (possibly) have a clear vision, but for a range of different reasons, they cannot execute that strategy.

What Allbright was alluding to was the suffocating effect of bureaucracies. The word bureaucracy comes from the French “Bureau”, meaning desk, and was first used by Colbert in the 18th century to mock and criticise government officials. Bureaucracy literally translated means “government by desk”.

C. N. Parkinson in 1955 in the Economist magazine described it as “work expands so as to fill the time available for its completion”.

Bureaucracies are like quicksand, they will absorb, slowdown, undermine, and ultimately kill. Executives must, therefore, be very mindful not to allow bureaucracies to develop because, if left unchecked, they will mushroom! The early tell-tale signs: creation of more and more project groups, meetings and more b****y meetings, full diaries, increasing committees, nothing happens until the consultants’ reports, the admin contingent begins to swell…Work does indeed expand and bureaucracies take on a life of their own!

Poor or unclear communication. Whilst it would be easy to blame communication for any organisation’s malaise, in my years of consulting experience, I have seen many manifestations of this. The vision is not clear. “To be the leading, most admired, bla bla” means different things to different people. Likewise, “to provide excellent levels of service” again would receive a range of very different interpretations. That’s why vision/mission statements have to be decomposed, i.e. everybody must be left in no doubt as to the exact strategic and operational meaning of those words and phrases. There has to be absolute clarity on sense of direction, markets we compete in and, by implication, markets we do not compete in, products, pricing, not to mention the organisation’s values and norms of behaviours.

All stakeholders have to be engaged in the vision and the strategy. If they do not believe in how the organisation is choosing to compete, blockages will soon surface, good people will leave and numerous tensions will appear at all levels within the organisation.

People manage what they get measured on. Fact! It is, therefore, imperative that Key Performance Indicators (KPI) are directly aligned to the strategic Key Success Factors (KSF). What needs to be understood and measured is not just results, but what drives results. Far too often measurements are set in the context of last year’s and driven too strongly by financial metrics. The result is a disconnect between what people are measured and rewarded on and what actually matters strategically. In our consulting work we often ask to see a few budgets, personal objectives and KPI’s at various levels. From this information we have to be able to “smell” the strategy and certainly understand very clearly why these measurements are in place.

“We need to change the culture!” How often have we heard this statement from Chief Executives. A pre-existing culture is usually the result of decades of behaviours, norms, practices and beliefs. A ten slide Powerpoint presentation, no matter how convincing, is not going to achieve that change. Culture change takes an eternity and, if the proposed new strategy does indeed require some kind of cultural adjustment, executives need to understand the enormity of the task at hand. So often this effort is underestimated.

“When I was at…” can be a dangerous preface for any executive in attempting to solve a problem. What is happening here is that a solution used in a previous situation is being recalled as it seemed to work first time out. While this may well be true in a medical context, in an organisational context the chances are that dynamics are different second time around and applying the same solution is misguided. It is, therefore, no surprise to see Chief Executives screw-up when they return to an organisation that they have served before. They think that they already know the problem(s) and fail to appreciate that (like them) the organisation has moved on. Steve Jobs of Apple is a rare exception, but then he had been gone for about thirteen years.

Walk the talk. Whilst this seems pretty obvious, executives often fail to appreciate that they are “on show” all the time. Everything they say and do is observed, decoded and analysed. Checking Blackberries during a meeting or interview is not only rude but highly unprofessional. It highlights an addiction and an inability to delegate effectively. As Oscar Wilde remarked “the World’s cemeteries are full of indispensable men”; enough said. There used to be a running joke within GE that whenever an executive said that he/she wanted a cup of coffee, somebody went out and bought Brazil. Informal behaviour is potentially more damaging as executives can be caught off guard. A car park conversation very rapidly becomes policy.

I could go on about so called strategy passion killers. I guess my key point is that it is insufficient to have a clear, succinct and potentially successful strategy arrived at after going through a solid and robust process. A construction project is not guaranteed success because of a brilliant design by the architects. Much, much more needs to happen. It’s the same with strategy.

Strategy after all has to degenerate into work! (Peter Drucker. Adapted)


Good luck!