Organizational leadership is hard. Extremely hard. Few people excel at it in good times, and even less people in bad times. Sometimes the deck is stacked against an organization due to dramatic shifts or misfortune. Sometimes a new entrant is caught in a tornado of success and the only real challenge is on-boarding enough talent fast enough and managing cash flow/working capital. While periods of growth probably seem a little easier, and are certainly more fun than periods of decline, all periods present unique leadership challenges.
If you don’t know where you are going, any direction will do. Organizations need a cohesive view of what value proposition the organization is creating, how it will create that value proposition, and why that value proposition is differentiated/compelling/relevant. The vision can extend to how an industry may evolve, what clients need, or even the disruption that will be caused by a specific technology.
Everything in business starts and ends with value proposition. What is the conversation with the consumer of the goods and/or services. That conversation can be about many propositions including cost, capabilities, or customization to the consumer’s requirements. The vision impacts what happens along the entire value chain of an organization, and what everyone in the organization does to support it.
The most critical function of strategy is to keep the executive team firmly focused on what is most important to success/achieving outcomes. Defining the elements of success and helping to shape the conversation about what should be done to make them a reality.
Organizations have multiple options when it comes to creating value including internal/organic investment, partnerships, acquisitions,and joint ventures. The strategy function in a company should lead the conversation on which of these options will generate the most value for the company, and often takes the lead on any inorganic transactions.
Strategy is sometimes divided into Corporate Strategy and Business Strategy. Corporate Strategy focuses on what businesses a company should be in. Business Strategy focuses on how a specific business will achieve outcomes. In addition, companies have the option to pursue different approaches to managing businesses including is there only one business, do multiple businesses act independently, and do multiple businesses act synergistically.
“A goal without a plan is just a wish” , Antoine de Saint-Exupéry. A strategy must be broken down to its constituents parts, a plan created, and resources allocated to the plan. The ultimate test of whether a strategy is real or not, is whether resources are allocated to it. The saying goes, the only strategy you have, is what you are actually doing. Some define strategy as defining how resources are allocated, one proxy for what you are actually doing.
Execution starts with clarity about why the plan is constructed the way it is, and the plan itself. Critical to the execution of any plan is everyone knowing what their piece of the plan is, and everyone being committed to executing their piece. It is no secret that companies often attract talented leaders with competing visions and agendas. Diversity of thought and experiences is a good thing. But one limb doing something that other limbs are not coordinated on, often leads to bad results, wasted resources, and demoralized teams. Execution starts with leadership alignment / commitment, with that alignment / commitment flowing through the rest of the organization. Execution needs to be focused on outcomes. It is too easy for teams to fall in love with a detailed project plan and dates, and in the process, neglect to pursue the outcome that made all the effort worthwhile in the first place.
Talent is critical to execution.
One of the most important functions of a leadership team is ensuring that the organization has the right talent. Beyond the table stakes approaches to effective communication, alignment, and growing talent, there is the difficult decisions around whether the organization has the right talent.
Putting aside the complexities of culture, loyalty, and past achievements, any leadership team needs to make the hard choices of what is needed now and going forward, just like any sports coach has to. Sometimes the game changes. An industry changes, or the old business model is just not driving growth anymore. Transformation creates specific challenges for leadership teams. Sometimes transformation can be achieved by swapping a few people out, and sometimes transformation requires transformational acquisitions and shifting leadership completely. The big challenge: a workforce that has been doing the same thing for 10, 20, 30 or more years has a fixed mindset about what is the right way to create value for customers, how processes should work, and what company culture is the “right” one. Moving that fixed mindset can be challenging, best case, especially while trying to execute on existing businesses at the same time.
Culture is what people do when no one is watching, encompassing values and behaviors. The more values and behaviors are shared, the easier it is for colleagues to understand each other, interact with each other, and create value.
Cultures often become mixed due to different leadership personalities. Culture may have to change as part of transformation. Dealing with the psychological, culture can be a particularly challenging aspect of leadership.
Communicate, communicate, communicate. People need to hear something more than once before it sinks in. Sometimes they need to hear it in different ways, and sometimes they need to hear how actions are aligned to aspirations. In addition, if something is working, let the world know. The world is busy, don’t be shy.
While the world sometimes demands flexibility and change, quite often it simply demands you focus on your strategy, and the execution of that strategy. Nothing is more critical than guiding teams away from distractions and focusing on The Important.
What is important is a balancing act. Understanding the vision and strategy, and converting that into action, executing on short-term achievements, and putting the foundations in for the long term. The focus must remain on outcomes. It is too easy for teams to get lost in the beauty of a project plan that has detail but no probability of achieving the required outcomes. The executive function must keep the entire team focused on outcomes, whether those outcomes be customer insights, incisive offerings, impactful sales and marketing, or transformation. Focus, focus, focus…on The Important.