|Auteur:||Overholt, Granell, Vicere and Jamrog|
|Organisatie:||Management Centre Europe|
Leadership is mainly about strategy and getting your strategy executed. What is required of leadership?
The way to get strategy executed is not by telling people what to do. It's by sharing the strategy in a way that everyone can understand and buy into it, and see how their jobs relate to it. Then by putting the people processes in place to enable and encourage strategy execution. Leadership is not simply a matter of behaviour and style. Leadership is mainly about strategy and getting your strategy executed.
What is required of leadership? This was the question that was asked in the recent Leadership Survey (undertaken by Management Centre Europe, the American Management Association and the Human Resource Institute of the University of Tampa). 1,600 executives and managers of global companies responded.
Respondents said the main job of leaders is to:
Formulate the strategy > Communicate the strategy > ENSURE STRATEGY EXECUTION > Measure the results
Once you have decided upon your strategy, then this strategy needs to communicated to your people. This critical task has replaced management's traditional role of planning people's work:
It is well-recognised that globalisation and technology contribute to a rapidly changing and complex business environment where "knowledge work" becomes ever more important. Consequently, managers at every layer are abandoning the idea that good management is about planning their people's work. People increasingly must plan their own work and make their own decisions.
The key to good management, and therefore good leadership, is in communicating and getting buy-in to the strategy, and in making sure that the decisions and actions people take are in alignment with the strategic direction of the organisation.
"Twenty-five years ago, management meant control. Managers put in controls, handed workers specifications, and established formal structures that ensured people did what they were told….. Today…executives say the hardest thing they have to do is improve people and corporate culture…. Rather than chasing another new management fad, or expecting still another magic bullet to come along, managers should focus on execution to effectively use the organizational tools we already have." - Rosabeth Moss Kanter in Execution: The Un-Idea. Fast Company.
Larry Bossidy and Ram Charan, in their book Execution: The Discipline of Getting Things Done strongly support strategy execution as a critical leadership role, making three clear statements:
However, "Strategy Execution" appears to be a real challenge:
Professor Lawrence G. Hrebiniak, Wharton Business School, recently identified the following issues. All four of the problems mentioned below are people-related issues:
Professor Lawrence Hbrebiniak at Wharton. Making Strategy Work: Leading Effective Execution and Change by Lawrence G. Hrebiniak, Wharton School Publishing. New Jersey, 2005.
The execution of a strategy very often fails because leaders do not focus on the critical issue of aligning the people to the strategy and the processes.
"The People Process is more important than either the strategy or operations processes. After all, it's the people of an organization who make judgments about how markets are changing, create strategies based on those judgments, and translate the strategies into operational realities. If you don't get the people processes right, you will never fulfill the potential of your business". Larry Bossidy and Ram Charan in Execution.
You should measure and monitor how well your organisation or division actively supports and is aligned to your strategy, and - if required - uncover the reasons why this may not be the case.
"If you can't measure it, you can't manage it"
Have a clear strategy and understand its implications throughout your company
It is well understood that a company or a division or business unit has to formulate its strategy based on a clear Customer Value Proposition for a particular target market or segment. Each strategy is special, but most can be categorised broadly into one of three categories:
Leaders, however, often underestimate that different strategies require different organisational behaviours - and therefore different leadership.This is particularly true in the following situations:
Clearly, leadership has to take a very different approach for each of the strategies mentioned above. But what, specifically, do leaders do to align their people to execute the strategy?
Robert Kaplan and David Norton of Harvard Business School conducted research which found that a staggering 95% of employees in a company are either unaware of, or do not understand the strategy.
To create the conditions needed for successful strategy execution, it should be understood that the attitudes and behaviours of people in any organisation are driven by five dimensions of people processes:
Strategy Cohesiveness - Do your people really understand the strategy and what it means for their job? Do they buy into it and support it?
Customer Focus - Do your people have an understanding of the customer relationship and the value proposition, even if they have no direct customer contact? Do they know how to deliver value to the customer?
Leadership Behaviour - Does leadership communicate a passion and excitement for the future? Is there the necessary style, motivation and commitment?
Performance Management - Are your performance metrics in line with your chosen strategy? Are employees recognised, evaluated and rewarded according to these metrics?
Organisational Culture - Do the attitudes, values and beliefs of employees match the organisation's core values and core strategy?
The five dimensions above are not new as independent concepts. What is key is that they form an interconnected, interdependent SYSTEM that must be managed as a whole. Actions taken in one or more areas must be supported by actions in the other areas to be effective. You will have to manage the five dimensions of Organisational Behaviour in a way that is specific to your strategy. Each strategy requires its own Organisational Behaviour.
Organisations are becoming increasingly sophisticated at measuring strategy execution operationally through initiatives such as the Balanced Scorecard and the use of strategy maps. However, these initiatives do not cover measuring the alignment of people. Effective measurements are the ones in line with the strategic objectives of the organisation, and in line with each other (see model in section 2.3).
To achieve this, an effective organisational diagnostic instrument should measure and monitor the alignment of people to the strategy, and show how well your organisation, division or department actively supports your strategy and - if required - uncover the reasons why they do not. The appropriate actions can then be taken.
Credit to Overholt, Granell, Vicere and Jamrog, 2005