The Language of Strategy 2 Execution

Better Execution: Change Your Strategy? [Part 1]0
ronald.lamb posted in Execution of Strategy, Challenges, Performance Improvement, Organization Change, Expectations, Improving S2E (Strategy to Execution), Life Lessons & Execution, Strategy on September 20th, 2006

Rob May of BusinessPundit.com, poses a really interesting question in a Blog posting.

““Does Change Help Link Strategy and Execution?”

He’s curious about how companies can improve the link between the two. The key question he poses is:
By consistently changing your strategy, do employees become more focused on the execution of it? Do changes in strategy lead to better execution?
I’m going to give my response to his interesting question in three parts.

Part 1:

• Too frequent change in strategy hurts execution success.

Part 2:

• Employees don’t become complacent about execution due to infrequent change in strategy.
• You can’t master a strategy.

Part 3:

• A famous Harvard University study, known as the Hawthorne Effect, may actually suggest that you can get better execution if you change strategy often.

Part 1

“By consistently changing your strategy, do employees become more focused on the execution of it? Do changes in strategy lead to better execution?”

This is a great question. It may seem like the answer is straight forward, but there is an interesting wrinkle based on a famous, Harvard University study. I’ll return to this study after reviewing the obvious response. I think most people would immediately answer that changing the strategy frequently will lead to poor execution. Here’s are some reasons why:

1. Uses up key Resources: Creating a coherent strategy is management intensive work. It eats up leadership time and focus. Refinement of a strategy is fine since it supports existing momentum. Changing strategy requires serious analysis, building of the end state and all the efforts necessary to gain agreement, communicate it, and build the plans to achieve it. Execution suffers due to management focus on the strategy rather than execution.
2. Wait and See: Critical work and decisions get delayed during strategy formulation work, as employees “wait and see which way the strategy goes”. “There is no reason to start some critical initiatives if they are associated with the new strategy, is there?” Execution gets delayed.
3. More Project Start-up Time: In many organizations a large majority is project oriented and doesn’t know what the strategy is. What they want is a good definition of the project they’re supposed to accomplish. Changing strategy means changing requirements. Execution suffers as projects associated with the former strategy have to get turned off and project resources released. New projects take time to get started as resources become available. Value isn’t achieved until the project team is providing deliverables that combine with other projects to create value. Execution suffers.
4. Feeling that You’re Delivering Value is Destroyed: Teams like to accomplish their project scope, on-time, on-budget. It’s what they get rewarded for. Changing people’s projects regularly doesn’t let them accomplish much. It is hard to be proud of being part of continuously partially completed projects. Execution suffers as team member’s sense of the value of accomplishment is destroyed.
5. This Too Shall Pass: When strategy changes frequently, it is tough to measure people and the value they are delivering. They start to understand that they’re not measurable. They realize that management has no ‘stick-to-it-ness’. People nod at all the right places when asked to change, but then do nothing. No one will check and they believe any change won’t be sustained anyway. It will go back to business as usual. “This too will pass” becomes the reaction to requests to change.

Part 2 Continues tomorrow.

break through business context Challenges change execution Execution of Strategy Expectations Guiding Principles Improving S2E (Strategy to Execution) life lessons & execution Life Lessons & Execution Organization Change performance improvement strategy

Business Context Changes Faster Than You Can Execute Anything Important.0
ronald.lamb posted in Execution of Strategy, Challenges, Performance Improvement, Resource Management, Relative Importance, Getting Everyone on the Same Page, Expectations, Qualities of Execution, Improving S2E (Strategy to Execution), Guiding Principles, Strategy, The Language of Strategy to Execution on August 1st, 2006

One of the primary guidelines I share with clients is;

Business context changes faster than you can execute anything important.

How relevant is that?

I just had a long term colleague depart from a senior corporate position. I asked him if he saw any warning signs. Apart from the reorganization that was the triggering factor, he saw a recurring theme.

The CEO would set out a new initiative for his department. They would work on it, and as they were nearing completion provide some initial feedback to the CEO. The CEO would let him know that it was no longer that important, and set out a new task. After enough of these episodes, he lost a sense of accomplishment and contribution.

This scenario is not unique to my colleague. Many organizations have similar issues.

Here are five lessons to be learned by any organization for dealing with the speed of change.

1. You can’t successfully operate a business with executives focused on initiatives. They need to be focused on targeted outcomes, which is a translation of how the strategy can be achieved. A strategy doesn’t change nearly as often as initiatives.

   With a defined, narrow, set of high-level targeted outcomes, it is possible to define the additional necessary interim outcomes. An executive can then determine the initiatives necessary to achieve that outcome. As conditions inevitably change, the executive can shift to more appropriate initiatives. This makes better use of key resources.

2. Use a shared method to communicate the agreed upon relative importance of the top-level targeted outcomes. No organization has enough resources to achieve all the outcomes necessary to carry out a strategy. There must be agreement on the starting point for the relative importance of outcomes. This is what in turn points you towards the initial set of approved initiatives. The problem is that business context changes faster than you can execute anything important. Midstream you’ll to have to shift resources to the initiatives that support the now more important outcomes.
3. Changed business context forces a change in execution behavior. For example, after some business change, you might be required to achieve the original targeted outcome:
1. With an even higher level of performance
2. sooner,
3. at a lower cost, or with reduced management attention,
4. with greater certainty of success,
5. with a wider reach to increase the area of impact
6. with greater buy-in,
7. with increased sustainability or
8. with greater measurability and transparency of progress.

I call these “Qualities of Execution”. Any change between behaviors you used when you started execution to one of the new Qualities of Execution™ requires potential shifts. These shifts can be in many areas e.g. behavior, process, technologies, partnerships etc.

4. Keep everyone on the same page. People learn about change at different times, in different ways. Their managers interpret the impact of change for their team members, and they interpret what their manager has told them. The organization must have a method to identify and communicate how a changed business context impacts the high-level outcomes and Qualities of Execution. Otherwise targeted outcomes will not be achieved. That’s what seems to have happened with my colleague. Failure statistics for strategic programs are well over 50%.
5. Manage down conflicting execution behaviors. Based on continuous interpretations of new business context, managers and team members change their expectations on how execution will occur and what the final results should be. Hopefully this means team members will change their execution behaviors. We all have met those people who don’t or won’t change their behavior regardless of the situation. They’re not reading this anyway and will randomly disrupt execution when their behavior is at odds with the desired Qualities of Execution.
   

   You must keep everyone on the same page as per the point above. You can then identify the desired Qualities of Execution for everyone at the same time, in the same way. You now stand a chance of having complementary behaviors and increase the chance of successful execution.

   Seeing conflicting behaviors is more often the case. You can imagine team members or a sponsor working differently to achieve an outcome;

   • as fast as possible, and another
   • at as low cost as possible, and another
   • with as much buy-in as possible.

These conflicting behaviors lead to dysfunctional inter-actions and increase the likelihood of failed execution.

Here are six steps you can follow to deal with the speed of change.

1. Start with everyone on the same page. Create an Outcomes Roadmap. Translate strategy into targeted and interim outcomes. They’re more executable than a thick strategy binder or PowerPoint presentation.
2. Assign outcome coordinators to ensure accountability. Outcomes use resources from all over the organization. One person needs to coordinate achievement of each outcome on behalf of the whole organization.
3. Focus on the most important things. Identify the relative importance of outcomes and the initiatives that support them. Attach resources to the most important outcomes. Manage how importance changes over time and shift resources as needed.
4. Keep everyone on the same page. Use multiple types of media to communicate the updated Outcomes Roadmap. Use gaps in achievement of targeted outcomes rather than initiatives as the focus of status reports and meetings.
5. Manage changing expectations and desired behaviors for success. Change occurs and is communicated through the Outcomes Roadmap. Use it to identify the Qualities of Execution that drive desired behaviors for execution success. Talk about the desired execution behaviors in your teams as they are required to change.
6. Translate wins into normal operations. Deal with diminishing returns when nearing completion of an outcome. Be prepared to capture value and shift resources. Make management status meeting more effective by reduced reporting on historic important outcomes as outcomes of higher importance eclipse the old.

I’ve introduced these steps to many clients. They can be adopted by individuals for their own targeted outcomes, by project teams on a targeted outcome, or for an organization trying to manage multiple competing critical outcomes.

All of the above is required. The days of completing a project before the business context changes are long gone.

Challenges Execution of Strategy Expectations Getting Everyone on the Same Page Guiding Principles Improving S2E (Strategy to Execution) performance improvement Qualities of Execution Relative Importance Resource Management strategy The Language of Strategy to Execution

The Language of Strategy 2 Execution Blog Manifesto0
ronald.lamb posted in Execution of Strategy, Business Transformation, Challenges, Performance Improvement, Organization Change, Getting Everyone on the Same Page, Expectations, Qualities of Execution, Improving S2E (Strategy to Execution), Guiding Principles, Failure Statistics, Measures of Success, Strategy, The Language of Strategy to Execution on July 29th, 2006

“Strategy 2 Execution” is defined as the single most critical process of an organization. In this context it is not a series of processes that ultimately take you from strategy to execution. This is the overall process. I also use the acronym S2E for it.

I wanted to create a message for first time visitors. It will be kept as a permanent link on the list on the right side of the page. I wanted to set a high bar for what the content was for the Blog. In the following I set out the need for a break-through in successful execution of strategy. I also set out what tests, such a solution has to pass.

Thank you in advance for any way that you contribute to that ‘quest’, whether it is through comments to the postings or by taking advantage of any of the ideas introduced here.

We all have something that is keeping us awake at night. Current capabilities and resources don’t seem to be enough to ensure certainty of successful execution. We have to rely on resources outside our control for our success. Surveys would claim that strategic programs fail well over 50% of the time.

No country or functional group has cornered the market on successful execution. Over the past 30 years I have worked or lived in over 45 countries. I have provided services in management consulting, strategy formulation, business and IT transformations, large program delivery, sales and engineering management. Failure is high everywhere.

A break-through solution that provides a step improvement is needed. Improvement efforts that include book and magazine articles by experts, methodologies, and standards seem to be providing only incremental improvement. They are largely providing high-level leadership ideas or focus on narrowly defined functional areas. We must work on Strategy 2 Execution as a single critical process. There has not been a significant improvement in overall Strategy 2 Execution success in years.

Successful execution is defined as “having met expectations”. We need to be clear about what success is. The bar for what defines success must be set higher than ever. Anything less is an illusion of success.

Here are five tests for a Strategy 2 Execution break-through solution;

1. Improvement is Both Measurable and Intuitively Felt: The definition of success varies widely. What is success for one participant is a failure to another. Measurability is a must but execution is often stopped because sponsors don’t feel that expectations are being met. The solution must address leaders’ intuition as to whether success is being achieved and whether their expectations are being met.
2. It Provides Overall Improvement: Execution improvements in specific functional or process areas sometime occurs at the cost of overall Strategy 2 Execution success. Overall Strategy 2 Execution improvement is what is needed. This will only be achieved by providing a solution that integrates strategy to execution processes with the way people are organized and deployed to work. It must hold overall improvement at a higher value than improvement in a specific area.
3. It is Scalable, for All Types of Execution: We exist in a global, connected world. Any solution must enhance execution across different hierarchies, functional areas, companies, industries, governments and cultures. Major performance improvement will only occur if the solution is scalable starting from individual to multi-party to large scale execution. To be widely adopted, it must be able to be incrementally deployed and serve all types of execution.
4. It Survives Unpredictable Change: Nothing important can be completed anymore before its starting conditions and assumptions change in some significant way. Level of importance, organization design and available resource/ finances will change before execution is complete. Inevitable change is the norm. Strategy 2 Execution must survive this.
5. It Serves Everyone Equally: The solution must be practical, simple to understand and easy to adopt. To be sustainable it must be shared by choice, by all roles, at all levels of the organization. It must serve to get everyone on the same page using a common language that all participants share.

This is the opportunity for leaders of all types to share our passion, curiosity, experience, and simple-to-radical ideas for improving overall Strategy 2 Execution success. Welcome.

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Failure to Meet Expectations Has a Major Impact on Success During and From Execution0
ronald.lamb posted in Business Transformation, Challenges, Performance Improvement, Organization Change, Expectations, Qualities of Execution on July 27th, 2006

Skip Reardon at Six Disciplines brings to light a McKinsey survey that sheds new light on what drives a successful transformation in organizational performance.  Respondents  reckoned  that their companies were conspicuously more effective than others at raising expectations about future performance, addressing short-term performance, engaging people at all levels of the organization, including a clear and coordinated program design, and making change visible –through, say, new IT tools or physical surroundings.  McKinsey also claims survey results show that emotions play a leading role in a performance transformation.

There is a strong link between expectations and emotions. (See research below carried out at the University of Colorado). 

I would claim that the right measure for execution success is having met expectations. If you agree with that, then you can see how important emotions are to success. The dark side of this equation is that missed expectations can lead to negative emotions that lead to poor execution. Sounds too theoretical, too academic? If you can’t find a way to improve management of expectations then execution will continue to be perceived as failure on a regular basis.

There are limitless types of performance expectations. Participants in a major change program might all agree on a high-level outcome for organization change /transformation. Even with that agreement performance expectations will vary widely in two unique areas.

• How transformation execution should be optimized during execution and
• What to optimize around for the transformation results achieved from execution

These two areas yield very different types of expectations. Expectations of how execution will be carried out during execution and what the result will be from execution lead transformation team members to very different types of behaviors.

When behaviors are conflicting between team members engaged in achieving the same transformation outcome, sparks fly, failure is the norm and careers can be lost.

Expectations of Performance During Execution
During transformation execution, participants and those funding it can differ wildly on how to optimize. That is, whether the execution of the transformation is proceeding;

• too quickly or slowly (optimized for speed),
• with enough concern for risk factors (optimized for certainty of success),
• in a way that provides visible, measurable progress (optimized to provide clarity and measurability),
• to reduce expenditure of  financial and fixed resources, and management time) (optimized for best use of resources/ low cost)

Conflict During Execution
A number of these from the list above are types of conflicting expectations. One group might be expecting to see the transformation occur as quickly as possible and another group expects it to occurs with as much organizational buy-in as possible. These two “Qualities of Execution” are usually conflicting. Change teams will execute in a way that optimizes one or more of these Qualities of Execution. Someone optimizing execution for speed will execute the same project quite differently than someone who is optimizing for certainty. There are very different behaviors involved in executing for speed versus for certainty. Which is the right behavior for the transformation manager? Someone who crosses all the t’s and dot’s all the i’s (e.g. a process/ details oriented behavior), or a Captain Kirk, a transformation manager who cuts corners, makes bold moves, “goes where no man has gone before”. Such variations in behavior during execution of a major change program lead to conflict and dysfunctional behavior among team members.

Expectations of Performance From Execution:
These same participants in the transformation have their own expectations from execution. Sure, they may all absolutely sign-on for the highest level change outcome, but during transformation, participants and those funding it can differ wildly on what to optimize around. That is, whether the transformation will result in;

• the greatest size of change possible (optimize for the greatest amount of transformation change)
• the change / transformation be long lasting (optimized for sustainability)
• an exceptionally high level of commitment to the change / transformation (optimized for buy-in)
• the change /transformation having the broadest impact (optimized for reach)

Conflict From Execution
A number of these from the list above lead to different and sometimes conflicting expectations.  For example, while working on initiatives to achieve an outcome, you might have team members working to maximize the amount of performance change.  At the same time you might have other team members working on the same outcome but in a way that would achieve it at the lowest cost.  The team behaviors by both groups would be quite different. You can imagine the type of conflict that can occur when there are different expectations for what to optimize on from execution.

Emotions and Performance are Impacted When Expectations Are Not Being Met
When expectations aren’t being met, emotions start to erupt.  The higher a team member’s expectations (e.g. Gee, I really thought we were on the same page here!) the bigger the emotional impact.  According to McKinsey, while respondents reported negative and positive moods in roughly equal proportions, more of the top performers reported experiencing the positive emotions - especially focus and enthusiasm.  It doesn’t take much to figure out that those two emotions can have a major impact on successful execution of any organizational change and transformation.

Here is some research on the connection between emotions and expectations. It is somewhat obvious, but nonetheless supports the research by McKinsey and my contention that you have to manage expectations for successful execution.
Management of Expectation can be accomplished using the “Qualities of Execution” approach.

Olympians’ Emotions Greatly Affected By Prior Expectations Says CU Professor from PhysOrg.com Olympians’ expectations going into the games often affect how thrilling their victories or agonizing their defeats will be, according to a University of Colorado at Boulder professor.

[…]

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Execution Failure Statistics and How Success is Defined - It’s worse than I thought0
ronald.lamb posted in Organization Change, Expectations, Improving S2E (Strategy to Execution), Failure Statistics, Measures of Success on July 17th, 2006

I was talking to the V.P. of IT projects for a multi-billion dollar financial services firm. We were talking about strategic project failure figures. We’d both seen studies showing failure rates pretty consistently at over 50%.

He told me that their firm hadn’t had a significant failure in over five years. I was astounded and impressed. After a failure that he placed at close to a $100M write-off, their firm had put in place the most strict procedures and approval gates that I’d ever seen. I suggested that it would be great to create a short case study on how they had managed to achieve such a success rate. To maximize the impact of the case I wanted to include a perspective from their business partners. I asked him whether his business partners would also claim that there had been no significant failures in the past five years. His answer was, “I have no idea”.

Scary, and no he wasn’t pulling my leg. It is still possible to find an organization that is so insular, so full of functional silos that someone at a V.P. level can declare success within their area without any consideration to the over-all success of execution. This organization’s performance measures and complex matrixes reinforce individuals to define success and failure to within only the scope that they control.

This type of corporate culture, this type of organizational thinking is one of the core reasons for execution failure. I first ran into the performance claim of “It’s ok leaving here”, when I was a young customer service representative working in Central America helping get airline communications networks online. The technician at Pan American or KLM or Eastern Airlines headquarters would tell me the data signal was “Ok leaving here” . That was his way of saying “ I have no more responsibility for successful connection between me and where you are”. In other words, his definition of success was strictly defined by what he could control.

This is the first posting for much more on the subject of how success is defined. It will also be a focus around how we are fundamentally organized and measured. We need to work, regardless of the organization structure, to achieve success in execution. I’ll also be soliciting input and links to other studies or examples of failure statistics, how success and failure are measured.

You’ll be seeing more of my recommended solutions for that challenge. Please stay and comment, if this is of particular interest to you.