Strategy is...

Part Two in a Summer Series on Creating a High Performing Organization: 

According to our marketing partner – Preactive Marketing – the phrase “strategy is…” generates roughly 13.6 million global hits. This indicates it is quite a popular topic and that people are interested in what a strategy should contain and why having one is important.

We’ll share our thoughts, though we also prefer to hear from you, so share your opinion!

Strategy has different meanings to different people – so how would you finish the sentence – Strategy is…

I would finish it something like this:

A strategy delineates a territory in which a company seeks to be unique.- Michael Porter

Wise words from Mr. Porter. Based on how most define strategy, the main reason for the existence of strategy is to achieve end goals. Organizations can’t succeed at getting where they want to go if they don’t have a plan of how to get there.

So…

Why is having a strategy important – why conduct strategic planning?

• A solid strategy is the cement and mortar in the foundation of any successful organization (that’s just one reason we offer our clients consulting services and training on this topic). You’ve got to have a plan – actionable processes.

A plan and process for how to:

• Handle change


• Manage for results


• Provide customer support


• Increase adaptability


• Promote communication


• Guide management decisions


• Remain future-oriented

The strategy is a supporting document that should contain actionable processes to help you answer important questions and achieve success – it should also outline what success looks like for your organization and how you measure that success. The strategy should assist in defining target markets, processes, structures, roles and responsibilities, and key customers and stakeholders.

• How does an organization develop a strategy?

Carefully – this shouldn’t be a rush job. The strategy is like the compass for your organization, it provides direction. Developing a strategy should include several components. A solid strategy should include a focus and analysis on both internal (history, politics, culture, structure) and external factors (competitors, customers, environment, laws and policy).  The organization should also include the development of the mission and vision of developing a strategy as well as targets, goals and initiatives, and measures of success.

So, in short, the strategic planning process should ask and answer the following questions (here is your cheat sheet!):

Where are we now?

• Internal/external  environmental assessment


• Customer and stakeholder identification

Where do we want to be?

• Mission


• Vision


• Targets


• Initiatives


• Objectives

How do we measure our progress?

• Performance measures and KPIs

How do we get there?

• Supporting strategies and initiatives


• Action plans


• Tracking system

You see…strategy is a facet of business that is imperative to succeeding.

“He who fails to plan is planning to fail.”  -Winston Churchill 

If you don’t know where you are going - how will you ever get there!

About Scott Span, MSOD: is President of Tolero Solutions Organizational Development & Change Management firm.  He helps clients to facilitate sustainable growth by developing people and organizations to be more responsive, focused, productive and profitable.

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*All Rights Reserved. Reproduction, publication, and all other use of  any and all of this content is prohibited without authorized consent of Tolero Solutions and the author.

J.C. Penney – During Times of Change – Funny Commercials Aren’t Good Enough!

After a full on rebranding, new strategic direction, and massive organizational changes designed to reinvent the retailer and improve profits - J.C. Penney suffered a dismal 1^st quarter. A lot exists for shareholders and stakeholders to be frustrated about – and much of it relates to organizational development and leadership (or poor leadership).

CEO Ron Johnson did have a vision - to get rid of the nonstop product promotions at the store and move to three kinds of prices (everyday, monthly specials, and clearance). He announced new designer partnerships and a new spokeswoman and advertising star, Ellen DeGeneres. He also introduced a new logo, and new color-saturated advertisements that barely mention price. Within four years, he said, the stores would be completely redone, each divided into about 100 small boutiques with a service center that he called “town square.” Ron has vision - but what he lacks is thoughtful and holistic understanding and execution.

*Update: As of June 18th, 2012 J. C. Penney Company, Inc. ousted its JCPenney brand president, Michael Francis, who oversaw the retailer's merchandising and marketing operations, with a terse statement that "We thank Michael for his hard work at jcpenney and wish him the best in his future endeavors."

Before leaders begin making organizational changes, no matter what successful past experience at other organizations may lead them to believe - it is necessary to collect current organizational data – data from stakeholders, data from employees, and most importantly, data from customers. Change can’t be rushed. It is said by some that a transformational change such as the one Penney’s is undertaking can take an average of 7 years – yup, you heard that correctly. Change isn’t easy folks, and doing it right takes time – just look at Pier 1.

So – just a few things (I have quite a list but I’ll spare all the details for now as I wouldn’t want to sound like a preachy CEO) Mr. Johnson should have done prior to jumping on the “turnaround CEO” bandwagon:

• Data: It’s extremely difficult to turn around an organization for the better if you don’t have a recent understanding of what “better” means. Now I’m not talking about just financial numbers, web traffic, etc. as I’m sure plenty of that was collected and analyzed. I’m talking about direct from the consumer’s mouth data. Before revising pricing methods and slashing merchandise promotions, ask customers how they would feel if prices were lowered all the time across the board. It doesn’t necessarily matter if customers “get” your pricing as long as they’re happy with the price, product, and service. Perhaps some customers prefer the feeling of getting a bargain, maybe they enjoy coupons (as evidenced recently in this case), perhaps they don’t like receiving a large number of promotional e-mails and ads but a few specifically targeted to their personal buying habits…point here is you don’t know what the customer wants unless you ask them – so take the time to collect data on your customers needs, wants and desires and don’t just assume you (cough: the leader) knows best!

• People: It’s imperative your employees have a solid understanding of why changes are taking place and how the changes impact them. Communicate with the workforce.  Not just so they have an understanding of how the change impacts them, but also so you can build their commitment to the process.  Employee commitment is imperative to maintain high performance and customer satisfaction during times of change. Penney’s employees, particularly the sales associates, were accustomed to a certain way of doing their jobs – selling and dealing with merchandise price cuts and promotions and customer service – in certain ways. They learned how to make a commission, when to push items, and when not to.

"Leadership is the art of getting someone else to do something you want done because he wants to do it."
- Dwight Eisenhower

Personal example – I bought a massage power recliner from J.C. Penney. When I first saw it listed online it was one price, when I went into the store to actually see it in person it was a different price. When I didn’t commit that day the sales associate gave me his card. I called him back a week or so later and the chair was miraculously over $150 cheaper with free shipping – if I came in to purchase that week. The sales associate knew the pricing system, he knew the price would be lowered, and he knew he could offer me free shipping as the price would probably be lowered yet again in a few more days. I felt like I got a good deal, I got my chair same day, and he made his commission of a higher amount. I was a happy customer and he was a satisfied sales associate.

If changes in process and procedures are going to occur that impact the day to day of how employees perform their jobs, then not only do you want to communicate those changes and ask for feedback – you also want to make sure you provide any needed training so they can succeed. Otherwise performance suffers, retention suffers, customer service declines, and shareholders don’t end up happy.

• Accountability: Mr. Johnson seems to be coming off like a stereotypical ivory tower CEO. Not an in touch and transparent leader. From what I’ve seen, his attitude regarding the current earnings announcement was a bit disingenuous. In typical financial fashion, the numbers were manipulated to try and sound somewhat positive. Oh Ron, just own it! Be a grown up, be an honest, transparent, accountable, and authentic leader. Acknowledge that things aren’t going exactly as planned – and don’t whine and make excuses - but let us know you see it too, and tell us the steps you plan to take to reevaluate and improve. That’s what builds trust in a leader - and in my experience trust in leadership can usually be correlated to high performing organization with committed employees, loyal customers, and increased performance (I really should do a study on that, if anyone knows of one please share!)

I do enjoy the new J.C. Penney commercials, but I’d enjoy shopping there a lot more if I knew the retailer had honest, transparent, committed, accountable leadership who elicited and acted on customer, stakeholder and employee feedback – but hey, that’s just me.

"Lead and inspire people. Don't try to manage and manipulate people. Inventories can be managed but people must be led."
- Ross Perot

About Scott Span, MSOD: is President of Tolero Solutions Organizational Development & Change Management firm.  He helps clients to facilitate sustainable growth by developing people and organizations to be more responsive, focused, productive and profitable.

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*All Rights Reserved. Reproduction, publication, and all other use of  any and all of this content is prohibited without authorized consent of Tolero Solutions and the author.

Attention: Chief Human Resources Officer (CHRO) & SVP HR: 5 Ways Organizational Development Can Help To Achieve Your Goals

The chief human resources officer (CHRO), also commonly referred to as the SVP HR, is a coveted role for many HR professionals and whose primary work involves strategic management and departmental decision-making that affects the organization’s people and viability as a profitable enterprise. If you’re serving in this function – congratulations on all your hard work!

The role of the CHRO has shifted over the years from responding to employee needs, compliance and setting policies - to the more strategic objectives of helping organizations build capabilities and capacity, via a focus on people. In this capacity, you may be responsible for a strategic human capital plan; professional development, talent management and recruitment, retention and engagement, and culture – not to mention making sure all initiatives are aligned with the company's strategic objectives and goals.  Not easy tasks – and not tasks that can always be tackled alone. Good news Organization Development (OD) can help.

5 tips on how working collaboratively with OD colleagues can help you achieve your goals…

1) Strategic Planning: Sometimes strategic planning can be a daunting task and can make one feel quite overwhelmed. What goes into a human capital strategic plan? How does the human capital strategic plan sync up to the overarching company strategic plan? What HR and people focused goals, objectives and targets should be included? Who is accountable for achieving these and how is accountability determined? What is the structured process for strategic planning? How should the plan be communicated and implemented? By training and practice most OD professionals have a holistic or whole systems view.

• An OD professional experienced with strategic planning can help you with the process; they can assist with the design, development, integration, and deployment of a human capital strategy and associated processes and procedures – with a keen focus on any impacts to the people.

2) Recruitment: Recruiting today seems to be a rush job or a one size fits all approach. This HR function is often one of the first to be outsourced. Recruiters get a position description and scour the internet for a match. Recruiters find a CV that matches the position description and send an often canned, cold and generic email. Recruiting has become less and less personalized. Many companies do not embrace a diverse recruiting strategy that mirrors the current diverse pool of applicants. Not always the best approach.

• An OD professional can assist you in defining your organizational employee value proposition. What is it you can offer to employees, what’s in it for them to work for your organization?  Being on the same page up front will help to reduce retention issues later. Yes, this is a two way street. Once your employee value proposition is defined you need to determine what types of candidates have, not just the skills needed to fill a role, but also have the values and beliefs that align with your organizational culture and value proposition. OD professionals can assist you with candidate prescreening, assessment and selection. Many OD professionals also practice in the areas of diversity and inclusion, and thus can assist you with designing and developing targeted diversity recruitment strategies.

3)  Professional Development: Professional development is a key component of successful talent management. For employees to remain engaged and committed, they need to feel that they have opportunities to learn and grow and know that new challenges and opportunities are available to them within the organization. Professional development and training needs to focus on various areas. The most successful professional development programs are those that consist of a combination of technical, functional and people skills training. Organizations also tend to have lower turnover when they have coaching and mentoring programs in place. How do you know what your employees want in professional development? How do you determine your skill gaps and areas of improvement? What are the best methods and technologies for implementing professional development in your organization? How do you deliver coaching and mentoring? How do you measure success?

• An OD professional can assist you in up-front data collection and analysis. OD professionals can help you determine your skill gaps, further define the challenges your employees face and define and deliver learning opportunities to help meet those challenges – inclusive or measures of success. Many OD professionals are also skilled coaches and can help coach your employees (and leadership) to improve in specific areas to which other training may not address.

4) Retention and Engagement: Consistent employee engagement is an imperative human resources goal. Creating a work environment where employees are enthusiastic and engaged is a top priority.  Many human resources leaders describe their greatest challenge, as “keeping employees happy and retaining top talent.” HR can measure this quantitatively with respect to turnover and retention. Human resources goals concerning turnover and retention are marked, respectively, by the words “reduce” and “increase.” Attracting qualified applicants, motivating and engaging the existing workforce and inspiring long-term commitment are often goals regarding turnover and retention.

• An OD professional can assist with retention and engagement. Beyond data collection and analysis, as trained behavioral scientists, OD professionals have an understanding of fundamental human needs. Having an understanding of what makes employees feel valued, heard, appreciated, and significant is imperative to designing and developing retention and engagement strategies. OD professionals also have experience in understanding motivational factors, and many are certified in tools and technologies to help further identify areas of improvement.  OD professionals understand and practice in the areas of diversity and inclusion which is also of great benefit in designing and developing targeted diversity retention and engagement strategies.

5) Culture: HR is becoming more and more responsible for employer branding – defining the image and culture. Creating an employer of choice is a goal that often falls within HR. An employer of choice is the company employees are happy to be a part of, a company for which others want to work, and a company customers want to do business with. These things are all part of culture - the set of shared attitudes, values, goals, and practices that characterizes an institution, organization, or group. Simply put, “the way work gets done around here.” A company’s culture says a lot about an organization and the direction they are headed.

• One thing OD professionals know a lot about – creating a high performing culture. OD professionals can help you define the type of culture you want, often beginning with spelling it out in your mission statement – which should be created as part of the strategy. OD professionals can then assist you in creating and maintaining a culture of high performance. Culture is the identity of a company, and because of that, in some ways it becomes an identity of those who work there. The people end up affecting the culture as much as the culture is affecting them. OD professionals can help HR maintain a positive and high performing culture via assisting with recruitment strategies, retention and engagement, and professional development.

Strategic planning…recruitment…culture…professional development…retention and engagement – that’s a lot responsibilities; which are your priorities? Which areas do you find to be the most challenging? Could you and your organization benefit from consulting external OD support?  If so feel free to contact us with specific questions - we’re happy to discuss how we can help you and your organization to achieve your goal.

About Scott Span, MSOD: is President of Tolero Solutions Organizational Development & Change Management firm.  He helps clients to facilitate sustainable growth by developing people and organizations to be more responsive, focused, productive and profitable.

Email | Website | LinkedIn | Twitter | Blog | Facebook

________________________________________________________________________________

*All Rights Reserved. Reproduction, publication, and all other use of  any and all of this content is prohibited without authorized consent of Tolero Solutions and the author.

Strategy vs. Culture – Can We Call A Truce?

Much discussion has transpired lately regarding strategy and culture – though, more so the battle between which is more important and why. Although I find the various points of view to both be of value and interest, I find the entire discussion to be quit absurd. Can we call a truce?

I imagine that if “Sally Strategy” and “Calvin Culture” were having a debate it would go something like this…

Sally Strategy: Calvin, I find that you sometimes make it very difficult for me to do my job! It’s hard to keep us on track when I feel you and I aren’t on the same page.

Calvin Culture: Well Sally, I sometimes feel the same way. Your job doesn’t always fit in with my work, sometimes you can be an impediment to what I’m trying to achieve.

Sally Strategy: Oh really, how’s that Calvin? What exactly is it you’re trying to achieve?

Calvin Culture: Well Sally, I’m trying to achieve building a positive environment for our people, an environment with a clear set of values and norms that engages and aligns our people, unifying them in delivering high performance and value to our customers. I just feel that the direction you’ve set can be a bit ridged and can be prohibitive to my work.

Sally Strategy: Interesting point, Calvin. You realize when I first started my work my intent was not just to help us formulate a clear direction and define who we wanted to be - but also to help us get there. It’s my job to execute, to get things done. Though we have come a long way since I first started my work and it may be time to revisit a few things. After all, I can’t get things done if I’m in the way.

Calvin Culture: Don’t get me wrong, Sally, I couldn’t do my job without you, and I value the direction and execution you bring to our work, as we both play a huge part in the happiness of employees and customers and in overall success, perhaps we could collaborate together more closely moving forward?

(*Aside - See the way that was phrased?  Calvin acknowledged what Sally brings to the table and made her feel valuable and important to the process.  Speaking to and providing feedback to your employees in this style can be beneficial to engagement and performance…but more on that in another article.)

Sally Strategy: That sounds like a fantastic idea. I’m glad we got a chance to connect. Thanks for taking the time to chat with me today, Calvin. Let's stay in communication.

In reality, culture and strategy are often viewed independently – they are both parts of the system and need to be viewed together.

 

Strategy can be defined in various ways…

• According to Henry Mintzberg’s book, The Rise and Fall of Strategic Planning:




• Strategy is a plan, a "how," a means of getting from here to there.


• Strategy is a pattern in actions over time; for example, a company that regularly markets very expensive products is using a "high end" strategy.


• Strategy is position; that is, it reflects decisions to offer particular products or services in particular markets.


• Strategy is perspective, that is, vision and direction.

• According to Kenneth Andrews’s book, The Concept of Corporate Strategy:
  
  
  
  • "Corporate strategy is the pattern of decisions in a company that determines and reveals its objectives, purposes, or goals, produces the principal policies and plans for achieving those goals, and defines the range of business the company is to pursue..."
  
  
  
  

• According to Michael Porter in his Harvard Business Review article and books:
  
  
  
  •  Strategy is "…about being different…It means deliberately choosing a different set of activities to deliver a unique mix of value." "…It is a combination of the ends (goals) for which the firm is striving and the means (policies) by which it is seeking to get there."
  
  
  
  

A strategy delineates a territory in which a company seeks to be unique.- Michael Porter

Based on how most define strategy, the main reason for the existence of strategy is to achieve end goals. Culture is the environment in which strategy achieves those end goals. It is a general framework that provides guidance for actions to be taken, and, at the same time, is shaped by the actions taken…this shaping in part occurs due to the culture.

No culture can live if it attempts to be exclusive - Mahatma Gandhi

Culture can be defined in various ways…

• According to Edgar Schein:
  
  
  
  • Organizational culture is “A pattern of shared basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration that have worked well enough to be considered valid and therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems.”
  
  
  
  

• According to Charles W. L. Hill, and Gareth R. Jones book Strategic Management:
  
  
  
  • Culture is "the specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization."
  
  
  
  

• According to Geert Hofstede:
  
  
  
  • “Culture is the collective programming of the human mind that distinguishes the members of one human group from those of another. Culture in this sense is a system of collectively held values.”
  
  
  
  

"We tend to think we can separate strategy from culture, but we fail to notice that in most organizations strategic thinking is deeply colored by tacit assumptions about who they are and what their mission is." – Edgar Schein

Whether written as a mission statement, spoken or just understood, organizational culture describes and governs the ways a company's leaders, employees, customers and stakeholders think, feel and act. Culture may be based on beliefs or spelled out in your mission statement – which should be created as part of the strategy. Beliefs and values are words that will pop up frequently when defining culture. Culture is the identity of a company, and because of that, in some ways it becomes an identity of those who work there, as well. The people end up affecting the culture as much as the culture is affecting them. So while there are many definitions of organizational culture, all of them focus on the same points: collective experience, structures, beliefs, values, norms, and systems. These are learned and re-learned, passed on to new employees, and continues on as part of a company's core identity.

So – culture is how “work gets done around here” and strategy determines “what work gets done around here.”  A positive culture and a clear strategy are both needed for organizational, employee and customer satisfaction and success. After all...

A satisfied customer is the best business strategy of all. - Michael LeBoeuf

We need to call a truce and work more collaboratively, both between and with culture and strategy, to truly create high performing organizations. Based on the definitions, and based on my experiences, the relationship between culture and strategy is – or at least should be- a symbiotic relationship.

What do you think…Is a battle between culture and strategy occurring in your organization? Do you think one is more important than another? If so why or why not?

*In this article, culture refers specifically to corporate and organizational culture and strategy to organization and business strategy

About Scott Span, MSOD: is President of Tolero Solutions Organizational Development & Change Management firm.  He helps clients to facilitate sustainable growth by developing people and organizations to be more responsive, focused, productive and profitable.

Email | Website | LinkedIn | Twitter | Blog | Facebook

________________________________________________________________________________

*All Rights Reserved. Reproduction, publication, and all other use of  any and all of this content is prohibited without authorized consent of Tolero Solutions and the author.

About Scott Span, MSOD: is President of Tolero Solutions Organizational Development & Change Management firm.  He helps clients be responsive, focused and effective to facilitate sustainable growth.

Email | Website | LinkedIn | Twitter | Blog | Facebook

 

Goal Setting - Why Bother? Are You Setting Your 2012 Goals?

2012 is literally around the corner. The topic of goals and objectives arises frequently this time of year. Many organizations (and individuals) have begun to update their strategies and create new goals for the New Year, have you? Hopefully you have, and if you haven’t, well – you may want to add it to your ‘to do’ list.

 

"Goals allow you to control the direction of change in your favor." - Brian Tracy

 

So what are goals and why are they important?

A goal represents the “to be” state, not the action of getting to that state. Goals are the most important outcomes that need to be accomplished to achieve and maintain the vision of the organization. Goals are derived from the vision statement and must be addressed through the objectives of the organization and establish the long-term direction for the work within the organization. In short, goals are the desired end result. As Stephen Covey says, it helps to "Begin with the end in mind."

Goals should also decide the results that are wanted/needed and set a time frame for achieving results. Most importantly, goals must build in accountability and consequences for not achieving them. Performance measures are the best indicators of success in achieving goals and outcomes; they should be relevant and practical.

 

 

It helps to ask…do the goals:

• Address improvements in performance of mission?


• Address individual improvements in performance?


• Tie to the strategic objectives?


• Capture the requirements of external and internal customers?


• Emphasize the critical aspects of the organization?

Most leaders know that an effective strategic plan must contain measurable high level goals and objectives, though goals should not only be high level organizational in nature. I am often asked by leaders who have a developed strategy, “why do my people need their own goals – we already have high level strategic organizational goals they are expected to meet?”  My reply, goals tell you as an organization where you want to be and what you want to achieve – they do the same for your people. Employees must have goals and objectives, not only to help support the organization in achieving its strategy, but also to see how the actions they take in executing their roles and responsibilities directly contribute to the broader organization mission and vision.

In developing organizational and employee goals, it is important to ask, “Are we measuring the right things?” Program, departmental and individual employee goals should align to and support organizational goals and objectives. If the workforce cannot see themselves and their actions in strategic goals, then your organizational goals aren’t as likely to succeed. Personal goals, incentives, and competencies should be aligned with the strategy. Without individual goals tied to specific roles and performance, it is difficult for employees to gauge the impact they are making through their work.  It is also more difficult for them to see the WIIFM (what’s in it for me) for achieving high performance - without goals, it proves difficult to measure, evaluate and reward individual performance.

 "My philosophy of life is that if we make up our mind what we are going to make of our lives, then work hard toward that goal, we never lose - somehow we win out." - Ronald Reagan

Clear communication of goals and priorities is necessary for people to see how their goals are contributing to organizational success and why they are being measured and evaluated against them. That creates a win/win for both the employee and the organization. For goals to truly increase accountability, they should include baselines. Baselines are time-lagged calculations which provide a basis for making comparisons of past performance to current performance.  A baseline may also be forward-looking, such as when you establish a goal and are seeking to determine whether the trends show you're likely to meet that goal. Measuring performance at a specific time establishes a baseline and provides the starting point for setting goals and evaluating future efforts and overall performance.

Several questions to ask when developing and defining goals: 

• Does the goal support the mission?


• Does the goal represent a desired result that can be measured?


• Does the goal reflect a primary activity, a strategic direction, a strategic issue or a gap in service?


• Is the goal challenging, but still realistic and achievable?


• Is there at least one key goal for each program/subprogram, but not more than can be reasonably managed?


• Is the goal important to management?


• Is the goal important to the employee?


• Is the goal important to customers and stakeholders?

Tolero Solutions offers various frameworks and methodologies that can provide assistance with strategic planning and goal setting. Just as your final destination is important to your journey, your goals are important to your business and your people. They define your destination and shape what your business will become. So, as you and your organization wind down 2011, give some thought to where you want to be, how are going to get there, and how you’re going to measure success – set goals early and take one step closer to being set for success in the New Year! After all, “If you don't know where you are going, you might wind up someplace else."  - Yogi Berra

About Scott Span, MSOD: is President of Tolero Solutions Organizational Development & Change Management firm.  He helps clients to facilitate sustainable growth by developing people and organizations to be more responsive, focused, productive and profitable.

Email | Website | LinkedIn | Twitter | Blog | Facebook

________________________________________________________________________________

*All Rights Reserved. Reproduction, publication, and all other use of  any and all of this content is prohibited without authorized consent of Tolero Solutions and the author.