There’s enough doom and gloom about in the economy at the moment without getting pessimistic about your strategy’s chances of failure. Square Peg director and the UK Institute of Consulting’s Consultant of the Year Phoebe Dunn shares her thoughts on Courting Disaster – how planning for failure can boost your project’s chances of success in an interesting and informative article available to members in our library.
With fragile economic growth threatened by the impact of European debt, reduced public spending, recent political upheaval and the natural disaster in Japan, will businesses see a need to renew their organisation’s strategy or is there a sense that we will soon be back to business as usual?
There are many definitions of strategy. One approach is simply a set of choices that determine the nature and direction of an organisation. With this definition in mind, Kepner-Tregoe is researching which areas of strategy and which specific strategic choices are in most need of attention, whether the requirement is for a minor course correction or a major strategic review.
They are calling for strategists to take part in a short online survey.
Participants will receive a copy of the research findings and be entered into a prize draw with the chance of winning iPad 2 loaded with Kepner-Tregoe’s ‘The Art and Discipline of Strategic Leadership’ audio book. There are also 20 runner-up prizes of a hardback copy of the book.
An SPS survey has revealed the factors that stifle innovation within members’ organisations.
The poll attracted a record number of responses, and highlighted that the most significant issue for most organisations was a shortage of time and resources, cited by 22% of respondents, followed by a focus on the short term, cited by 19%.
However, the role of leaders was also a highly influential factor. A lack of support from the top of the organisation was said to affect innovation at 15% of organisations that took part in the poll, followed by a lack of support from line management at 13%.
The absence of a supportive culture for innovation was also a critical problem. Some 13% said there were no internal role models, 12% said there was no cultural emphasis on innovation and 5% said there were too many perceived penalties for failure.
This month we are asking: what place does sustainability have in strategy? To take part in the poll, click here.
There is a big difference between the conditions that can accompany strong organisational performance in benign economic times and those that yield sustained performance, through good times and bad. This was the conclusion reached by the Chartered Institute of Personnel and Development after a two-year research programme, Shaping the Future, tracking six organisations undertaking change programmes over a two-year period. The final report identifies ten keys to long-term performance.
1. The organisation change response needs to be truly agile and enduring, not a knee-jerk reaction that quickly dissipates: Change should manifest itself as a proactive agility, creating organisations that are open to new directions, aware of the limitations and risks of not changing, and equipped to keep moving and adapting.
2. There is a fine balance between alignment and flexibility: Although aligning employee, customer and other stakeholders’ values, behaviours and objectives with a wider organisational purpose is important, over-focusing on this alignment can create barriers to the flexibility needed to enable the organisation to change.
3. Shared purpose can only be achieved by finding human connections beyond short-term profit or efficiency targets: By fostering among employees a genuine sense of shared purpose and meaning at work, stronger connections, engagement and performance can be delivered.
4. Collaborative leadership brings sustainability, so organisations should avoid defaulting to a directive and driven approach to leadership in tough times: Reinforcing a collaborative problem-sharing approach can drive longer-term, sustainable change, agility and engagement.
5. ‘Middle management’ have a valuable transforming and translating role but are often sidelined, bypassed or cut out in change processes: Suitably skilled middle managers can play a key role as transformers and translators in bringing change to life.
6. An over-focus on today’s needs is not true talent management; it’s talent tunnel vision: Identifying and developing the capabilities individuals will need in the long-term is crucial to meet the organisational imperatives of tomorrow.
7. Truly understanding employees’ locus of engagement can avoid the risk of overattachment and underperformance: Organisations need to get under the surface of employees’ engagement and better understand whether they are truly engaged with the organisation and its core objectives.
8. Perceptions of unfairness undermine employee engagement.
9. Process-heavy organisations are often insight-light: Overemphasis on backward-looking targets defends existence but doesn’t prove worth. Organisations need to cull data that doesn’t add value and be curious with the remainder to uncover real insight.
10. Leaders don’t always know best about the long-term vision: Effective mechanisms for upward communication – that filter important signals from the ground from the background noise – can provide real insight and challenge for leaders, and inform longer-term planning.
A new global report by The Boston Consulting Group and the World Federation of People Management Associations has revealed that strategic workforce planning is falling far short in multinational organisations.
The report, Creating People Advantage 2010: How Companies Can Adapt Their HR Practices for Volatile Times, found that while the time horizon for strategic workforce planning should be at least as long as that for strategic planning, only 15% of respondents use workforce supply models, and only 9% use more advanced models.
It means there are worrying talent deficits on the horizon, with a dearth of leadership skills at senior levels that will peak between 2020 and 2030. Some 56% of survey respondents said there was a critical talent gap for senior management’s successors. The biggest was expected in IT. Around the world, problems were most expected in Japan and the former Soviet Union. This has a clear impact on the effectiveness of the business. High-performing companies recruit 50% of their leaders internally, compared to 13% of low-performing companies. When developing future leaders, high-performing companies consider people development and effective decision making key – more so than lower-performing businesses.
Every leader should have a strategic plan. Whether it’s a large corporation, a non-profit, a government agency, a department, a project or a team, the leader is responsible for ensuring that the organisation has a clear strategic direction and a plan for making that direction a reality. Sometimes, however, a leader is ready for strategic planning, but their team is not, so how can you tell if you fall into this bracket, and what can you do about it?
A good gauge for determining if the team is ready for strategic planning is to answer the following questions:
1. Is there a widely held belief that there is a need for a shared direction and agreed upon priorities?
2. Are the key issues to be addressed by the plan identified?
3. Have the outcome and benefits of planning been clearly delineated?
4. Have an approach and timeline for strategic planning been agreed to?
5. Has the group agreed how this planning process needs to be different from past processes?
6. Has the team determined who should be in the room when the plan is developed and how you will gain the buy-in of those not in the room?
7. Are the people who need to be in the room willing to commit the time and resources required?
8. Has the information that needs to be compiled in advance of planning been identified, including results from past planning efforts?
If the answers are ‘yes’, you’re ready for strategic planning with your team. If your team isn’t ready for planning, the first step is a strategic plan briefing. There are several benefits to the management briefing: your planning team will gain a common view of the issues to be addressed; they will have determined what modifications might be needed to the standard planning approach; they will have agreed on a set of strategy definitions; they will have begun identifying the information they need; they will have assigned responsibilities; and executive teams typically walk away with increased buy-in and commitment to participate in the planning effort and follow through on actions.
The management briefing needs to address the key issues facing the organisation, using brainstorming and grouping techniques. Then the approach needs to be established. It is useful to begin with a standard strategic planning approach, then have the participants link the issues to the approach, ask them to identify strengths and concerns about the approach, and agree on adjustments to ensure the approach addresses the key issues as needed. Once this is done they can agree who will be involved, and at what level.
The next stage is a situation assessment, which determines the information that should be gathered and distributed in advanced to ensure all members of the planning team start with a common foundation of information about the organisation’s performance, customers, employees, industry, and competitors. It will also handle logistics, and identify the immediate next steps.
If successful, the management briefing will provide a strong foundation for launching your strategic planning activities.
By Michael Wilkinson, managing director, Leadership Strategies
A recent survey from Roland Berger Strategy Consultants, based on interviews with a mix of board level decision makers and Financial Controllers at 52 of the UK’s largest firms, demonstrates that the economic crisis is far from over. The critical liquidity issues in UK business, which characterised the downturn, have not eased and, combined with the lack of restructuring in 2009, will threaten the UK’s return to economic growth.
UK companies are currently forced to actively manage the crisis through liquidity controls, rigorous cost cutting and business plan adjustments. Most companies surveyed will continue to restructure over the next six months. And while compulsory redundancies across UK companies are declining, pay and recruitment freezes will remain crucial.
Only half of those surveyed (49%) believe the worst of the economic crisis is over. However, most companies expect some economic growth in 2010 (between 0.5% and 1.5%) with stronger growth of 1%–2% anticipated for 2011. While 86% of the companies expect to reach pre-crisis sales levels by 2012, a heavier tax burden and restrictive lending will worsen conditions in the short term. Investment levels frozen in 2009 are not expected to increase for the rest of 2010.
Asia has been identified as a clear opportunity for growth by three-quarters of the respondents, but significantly less optimism was expressed for European growth opportunities. Over half expect to finance future growth using their own resources – evidence that companies are unwilling or unable to secure further debt.
Liquidity expectations in Western Europe are similar to the UK, while more companies in China, Middle East and Central & Eastern Europe are experiencing critical liquidity situations. Overall recovery expectations for 2010 and 2011 are slightly more positive in the US and Middle East, with China’s expectations for growth between 8% and 8.5%.
“More awareness needed of how to explain the business model” according to Cass Business School this week.
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