Is your team singing from the same hymn sheet with regard to strategic priorities? Do you have the same understanding of these priorities? How do you formulate and share the strategy and do you involve your team? Do you possess the right leadership competences to come to an effective strategy realisation?
If you want to come to successful strategy realisation, there are at least 3 important conditions to fulfil. This week the first one: Strategic consensus.
- Strategic consensus: Do you have the same priorities within the leadership team and so you explain these priorities in the same way?
In your management team it is important that you agree on the essence of the strategic priorities and the subsequent objectives. Thereby it is important that you check whether you have the same understanding of the priorities among team members.
To make your strategy work, we need an active role of (preferably) everybody in the organisation. Only then you are able to truly excel as a company. To achieve this, it is important that everybody understands his/her role in the bigger picture: What do I contribute from my role to the strategy of the company?
In order to answer this question you need to be familiar with the strategic goals and priorities, but also that your colleagues in other leadership positions, explain these priorities in the same way. If this is not the case, miscommunications can be the result. To realise this common understanding the following elements are important:
- Create a clear and well-timed meeting structure that enables the feedback loop about the strategy between board, middle management and operational management. In this way you minimise room for communication errors and you maximise the opportunity for alignment.
Example: A retailer has as a strategic target to maximise turnover. To be able to steer towards this goal a weekly management meeting is initiated on Monday morning. This meeting is followed by the weekly team meetings of the operational teams on a Tuesday afternoon. The management meeting needs to be prepared by the Category Managers; they are the linking pins to the operational teams. They explain their developments in turnover within their category and formulate, together with their teams, actions aimed at improving the results, working towards the strategic goal. In this current meeting structure they have insufficient time for this on the Monday morning.
This influences the quality of the management meeting: people spend too much time on explaining and reporting on the data and there is no time to formulate actions and decisions. Next to that the Finance & Control department has troubles delivering the reports on time. This causes more time pressure and loss of quality.
The management team gets annoyed: “ We are only looking backwards in our meeting being reactive, how is that useful?” This causes in its turn, lack of clarity in the operational team meetings:” We work hard to report on our categories from our side, with a lot of pain and effort, but the management team is indecisive.”
They decide to move the management meeting to Monday afternoon. Category Managers have now enough time to prepare, there are better suggestions to steer towards the goals, the Management Team can make decisions and the operational teams can execute and deliver effectively. In this way the PDCA-cycle is taking place more effectively using the meeting structure in place. A simple change, but a world of difference!
- Make space for constructive conflict and dialogue between leaders when priorities on departmental level cause conflict, hereby it is important that organisational interest prevails over departmental interest.
Example: a retail bank strives to (1) grow customer numbers and, (2) guarantee a high customer satisfaction. Marketing & Sales are successful and the sales go through the roof. However, Customer Service can’t process all the new customers on time, which put the customer satisfaction at risk. Customer Service needs more capacity to live up to the demand or Marketing & Sales needs to hold back a bit, so that Customer Service can make up the backlog. In a joint discussion with Finance both the departments make an overview of the consequences: the budget for wages comes under pressure at Customer Service or the target for new customers comes under pressure at Marketing & Sales. In their discussion they decide to hire temporary workers in Customer Service.
- Create a culture that is safe and invites to challenge each other and respect each other’s functional area to make constructive conflict possible and stimulate openness. If there are leaders that act in conflict with priorities and accompanying agreements, they need to receive feedback. Hereby is example behaviour (especially from higher level management) key!
Example: Within a consultancy firm, the strategic priority is set to focus sales activities on the national market. One of the partners Dave, who delivers a significant contribution to the sales targets for years, keeps putting effort in expanding his foreign customer portfolio. Ann, the managing partner, decides to give Dave feedback: “ Dave, you where there, right, earlier this year, when we made decisions on our strategic focus?” “ Yes, I was”, answers Dave. “ How is it possible that you keep investing in our foreign portfolio, while we decided to focus on the national market?” askes Ann. Dave mentions that these customers are his customers for years and he can’t just say “No” to them. Ann, mentions that she understands this, but that is it not in line with the strategic agreements they made. Dave is reluctant:” These customers have given us significant work for years, how are we going to solve that?”. “Dave, we already had this discussion in our Partnerteam and we then decided to accept this side- effect, since we want to focus our growth on the UK and strengthen our position nationally”, says Ann, “ You also put your signature under our strategy and I am not willing to have this discussion again. A decision is made, and we stick to it”. Dave mentions that he feels slightly insecure with the new focus. Together they decide to determine an exit strategy for the customers outside of the UK and to identify opportunities within Dave’s sector that are in line with the strategy. Ann and Dave have a couple of follow-up meetings and the strategic focus returns in the portfolio of Dave.
Next week the second ingredient: A healthy mix between a top-down & a bottom-up approach, keeping pace and effective communication