How to manage strategic initiatives
Boston Consulting Group (BCG) issued a review of strategic initiative management at the end of 2013 in which they focused on four imperatives for successfully executing on strategic initiatives. This post will review elements of the report and provide the i-nexus perspective.
BCG have moved a long way past the portfolio matrix with which it is still associated. As one of the world’s leading strategy consultancies, they are also focusing on strategy execution as a key differentiator. One of the comments made in the paper is that “too many senior executives have trouble getting the information they need to make the frequently necessary adjustments and course corrections that in today’s business environment are critical for ensuring that large strategic initiatives will deliver their target impact”.
There are several important points contained above. Firstly, the acknowledgement that executives need to make very frequent course corrections, and therefore that visibility into and transparency of major initiatives is essential to enable this. It’s no longer good enough for a report to take a week to produce; information is required in real-time. Although it is essential that executives are clear on progress or otherwise, I suggest that all employees involved, need to have access to relevant real-time information as execution relies substantially on people delivering at all levels.
Specifically, BCG propose four imperatives for execution:
- Focus on critical initiatives. This concept (breakthrough objectives) is fundamental to the Hoshin Kanri methodology. The slaying of sacred cows, the hammering of some of the egos involved and the frank discussions required to arrive at a focused set of breakthrough objectives are all required and useful parts of the process. Executives need information focused on a few key initiatives in a world that tempts many executives not to focus.
- Institute smart and simple processes. Easier said than done. If the strategic initiatives require additional load being placed on existing busy people (which is generally the case), some elements of existing workload either have to be removed (seldom the case) or executives need to be realistic on time frames and the scope of expectations. Forcing through unrealistic expectations is highly likely to kill the execution process at this point.
- Foster talent and capabilities. Effective strategy execution does imply a clearly identifiable set of competencies. That’s why our view at i-nexus is that those companies with a successful track record of Operational Excellence are likely to do well with strategy execution. Large numbers of employees already know how to identify problems, analyse them, run projects, take responsibility, and focus on improvement. An important part of this is that leaders need to learn to let go. Leaders do no execute – they set the direction and then need to identify where course corrections are needed. People at all levels execute and need the skills and support to do so.
- Encourage a culture of change. One of Hoshin Planning’s real strengths is the catch-ball process which looks to align the strategy before execution commences. In my view, real (sustainable) change is only likely to be achieved when employees realise that leaders genuinely support their execution activities.
Almost all strategic change in complex organisations takes place through projects and programs. Those companies that develop execution skills will thrive.