Archive for April, 2012
Recently I have been helping a company formulate a new strategic direction. The companies primary shareholder has had a major shift in their thinking and wants the company to shift their focus to a new customer segment, pretty much a 180 degree shift.
Now it is easy enough to develop a new strategy, objectives and milestones to meet the new mission but it isn’t easy to get the plan into action. Why?
Put simply the managment of the company has built a very strong culture, over more than a quarter of a century of existence, around the old product and market set. They have engaged staff in that journey and employed people who fit well within that framework. And they have used performance systems and rewards that are intimately linked to the old ways. Unfortunately there is now a lot of resistance to what the shareholder wants. Many companies have found themselves in such a position where a major change is required due to whatever pressures, have failed to adapt and have fallen by the wayside. Polariod is an excellent case study.
How to solve the problem?
Well nothing can be done overnight, even though that is what their shareholder is expecting, indeed demanding. Changing direction suddenly and with such a major impact requires fine tuning the engine of the organisation coupled with a lot of hard work and patience. Just saying what you want rarely makes it happen. In fact in this case it is having the opposite, and not unexpected effect, denial, anger and head long resistance from some employees. “Why change, we have been doing this for 20 plus years and it is working well. The shareholder doesn’t understand, lets show them they are wrong!”
Well what I am sure of is that taking your key shareholder head on is certainly not going to be a winning strategy!
So here are the steps I have recommended.
- Establish the role of Manager Organisational Development (title is not that important but the power you impart to it is)
- Make the new role report directly to the CEO, and have the CEO give it strong and visible support.
- Pick the most patient, most persistent and most energetic manager to fill the position – certainly one who embraces the new direction and importantly one known for getting results.
- Establish the outcomes, timeframes and responsibilites for delivery of the action and execution plans – do this in a collaborative framework utilising staff from all levels, agree what must be done, by when and by whom.
- Have timeframes short and make goals as simple as practical – it is easier then to ensure no claw back to the old ways, changes are sustained.
- Establish transparent reporting arrangements – make it easy to know how the change is actually going. This will conteract those peddling bad news.
- Communicate, communicate and communicate – the new direction, the reasons behind the change, the progress and the good news stories, have an open door so those seeking the real answers can get them and thus shut down the water cooler conversations.
- Celebrate the successes and reward those who make a positive difference.
This will generate energy and energise those who are ready to adopt the new direction. New opportunities, new ideas and a penchant to try them can make for an exciting place to work.
Of course some people will never change. Sadly, no matter how good they are at there job, it is best for them to move on.
Turning the ship requires a strong hand on the wheel and a close watch on drive train.
I think it was Winston Churchill who stated something to the effect, strategic plans are wonderful things but sometimes it doesn’t hurt to have a look at the results.
What he was in some ways getting at is that one of the big problems all organisations face is getting strategy executed. And if you don’t execute it is pretty hard to get results.
Jeroen De Flander, the author of Strategy Execution Heroes noted in his book that:
- 15% of people believe the strategies are the wrong ones.
- 30% don’t receive info on how to execute the strategy.
- 40% believe strategic initiatives are not staffed with the right people.
- 27% believe strategic initiatives are being managed correctly.
- 18% are unable to explain how to translate strategy or set individual objectives.
Pretty poor numbers by any measure!
Now couple that to change leadership group Prosci’s research on the impediments to change and you can soon see why so many plans fail to get executed.
They found over many years of research that the biggest obstacles to change are:
- Ineffective change management sponsorship from senior leaders
- Insufficient change management resourcing
- Resistance to change from employees
- Middle-management resistance
- Poor communication
Major shifts in strategic initiatives require strong change leadership to get them through. I have been advocating that the whole process can be made easier by involving those who will have to implement the strategies in the development of them. Of course in large organisations or those widely dispersed over the globe this is not allways practical. Sensitive change leadership will be a key skill that managers will need to get the strategies into place.
In my experience resistance at middle management has a major bearing on the success or otherwise of the organisation. Engaging change champions across all levels and locations of the organisation and giving them direct access to senior management goes a long way to lessening this hurdle. Harness the energy of those seeking change and make it easy for those sitting on the fence to come over to the new thinking.
So just because your team comes up with a great strategy, one that is going to help your business grow and prosper doesn’t mean that the entire team is going to welcome the new direction with open arms. Have a look at the issues above, work out which apply in your organisation and start implementing activities which will give the new strategic direction the best possible opportunity of seeing the light of day.
The old cliche – failing to plan is planning to fail is only part of the story, failing to plan and manage the implementation is just as big an issue as having no plan at all.