Carrying Strategy from the C-Suite to the Reception Desk

The challenge organizational leadership faces is carrying strategy from the board room to the receptionist's desk. That is, extending strategy mindshare throughout the organization, not just among those at the top of organizational chart.

In my last post I promised to provide more detail on the "how-to" of developing a broader context on organizational strategy among the "doers," as well as measuring strategic mindset.

Let's review the traditional strategic planning methodology paradigm:

1. A strategy document transcribed from flip-chart plastered walls is reviewed by top leadership.
2. Top leadership sets goals and objectives for middle management that it believes are aligned with the strategy.
3. Middle management establishes performance metrics for the line-level that align with the objectives.
4. Top leadership and management regularly monitor and evaluate performance against the metrics, then adjust as necessary.

Traditional management models will say this is the "ideal," that effective strategic execution requires cascading measures starting broadly from top management down to the granular performance measures of line-level staff. Line-level performance measures tie upward in progressively broader ways to the "big picture" vision.

Sounds great. But, as I've outlined in previous posts, it's a flawed concept. It applies a management approach to a leadership function. Leadership involves influencing people, whose actions are driven by values, attitudes, and organizational culture -- mindset. The cascading measures approach is a process-focused approach measuring actions taken, not the values, emotional connection and shared understanding that drive the actions.

Without strategic mindset, doers will only do what is measured in an execution plan. They won't think "out of the box" to intuitively take aligned actions that are not part of -- and may even be superior to -- the plan.

Ultimately, taking strategically aligned action should be natural and innate without any prerequisite objectives and performance metrics needed. Strategic execution should be like driving home from work. You know where you live. You don't need a map. You just know how to get there, no matter what direction you're coming from. This is "intuitive alignment."

Cascading measures are for operational alignment, not strategic leadership. While such metrics do align actions in the organization around strategic objectives, they don't encourage a strategic mindset. They measure outcomes, not the mindset driving the outcomes. So while actions may be taken in alignment with the performance measures, without strategic mindset, the actions taken outside of such measures may have no alignment with the strategy whatsoever.

Strategic mindset is a large bowl containing a wide array of aligned actions, both measured and unmeasured. Without it, the organization will only become effective at implementing the narrow range of measured actions, leadership's best guesses at the correct means to achieve the ends. As is now widely accepted, often the best ideas come from the line-level closest to the customer. Thus, keeping the "owner" mentality in the C-Suite deprives an organization of its full strategic capacity.

To most effectively execute strategy, drop the cascading measures approach entirely. That approach is fine for addressing processes, where the goal is to achieve incremental improvement, higher productivity and better operational efficiency. But let's not confuse process improvement with strategic execution. The most efficient operations won't overcome obsolete strategy.

So what is the strategic leadership tool that replaces cascading measures? Conversation. Strategic conversation, specifically. Strategic conversation is the most powerful tool to ensure strategic execution, not plans and metrics. It is through conversation that values are clarified and cultural norms are developed.

But first, a caveat. Don't confuse strategic conversation with "communicating the strategic objectives, goals and vision." That's the "fix" applied to the failure of the cascading measures approach used in strategic planning methodology. It is yet another false diagnosis for why a "strategic plan failed" (not attributing it to the true cause that strategic planning is a flawed concept in the first place). The diagnosis being that the plan wasn't effectively communicated.

Referring to the previous example of knowing how to get home without a map, think about how we reached a state of intuitive alignment. Over time, we developed a mental map through daily repetition, occasionally trying different routes, and learning the broader context of the area in which we live by exploring the neighborhood. And the key reason we take the time to learn and explore is because the place we are going is our home, it's where we live, a place to which we have an emotional connection.

The same process creates intuitive alignment in strategic execution: creating a mental map through repitition, trying various routes, developing a broader context by exploring the neighborhood, and having an emotional connection to the endpoint. And the last item on the list is the most critical and the reason why a process-focused approach is inadequate. No one feels an emotional connection to organizational vision statements, plans, performance metrics and checklists. Not even leadership.

Wait a minute. . . leadership has no emotional connection to a vision statement? No. It's not the statement itself, but the story, the mental image, the triumphant manifestation of the outcome that the statement attempts to describe, which inspires.

"All instruction is but a finger pointing to the moon; and those whose gaze is fixed upon the pointer will never see beyond. Even let him catch sight of the moon, and still he cannot see its beauty." - Zen Quote

Vision statements are a finger pointing to a future state of being (the moon).

A couple designing a custom home isn't excited by the blueprints, but their mental picture of what the finished home will look like, seeing themselves in it, sitting by the fireplace, swimming in the pool.

That is the essence of strategic conversation. We co-create a shared mental image of the endpoint and together we get excited about what we're building. This requires each person to become an active participant in the conversation. The shared vision comes from describing together what it's going to be like living in our new home, having a barbeque on the patio. And in an organization, the conversation needs to involve the whole family.

Taking the metaphor a little farther, the conversation continues throughout the various phases of construction. Though all are committed to the general vision, various changes to the design may occur as unidentified problems come to light after building begins. So, though the final structure won't look exactly like the original plans, because we discussed solutions together with a common understanding of what we wanted to achieve, we'll create a better end result.

Measure Mindset, Not Past Performance, In Strategic Execution

To build a strategic organization, not just strategic management, measure alignment rather than achievement.

Measuring strategy execution traditionally means reviewing achievements according to the plan (i.e., checking off progress against the to-do list). This approach focuses on "lagging indicators" -- things that have already occurred -- which may be an effective approach for operational management, but ineffective for strategic leadership.

Another reason I discourage the checklist approach to strategic execution (i.e., leadership developing detailed goals/objectives/task lists) is that it limits implementation to those goals/objectives/tasks prescribed by management.

By focusing only on leadership's "best guess" regarding desired actions toward the organization's strategic focus, those who implement strategy are discouraged from formulating actions based on their own real-time "boots on the ground" assessment. In other words, they will do what the detailed action plan says, even if their own (often superior) assessment says it would be better to take a different path toward the same strategic outcome.

With this in mind, as leaders, we should create broad limits within which to take strategic action, but leave the specifics up to those with specialized knowledge of the area of strategic focus. This does beg the question: okay, so how do we measure progress against strategy?

Since we're leaders, not managers, when wearing our strategy hats, I suggest looking at leading indicators of strategic execution -- that is, the behaviors that lead to strategic execution. That means, rather than using achievement metrics (i.e., goals and objectives achieved), use alignment metrics. Alignment metrics measure mindset: vision clarity, attitudes and cultural support.

Creating Alignment Metrics

Let's revisit the graphic I used in a previous post, but I've altered it by adding the words in big letters on each side. In that post, I stated that strategic leadership means staying on left side, NEVER venturing onto the right side. Why? Note the words in big letters I've placed over the graphic. Organizational transformation only occurs on the left side. Focusing on the right side only makes us better at doing what we've always done.
So, where does one begin in developing alignment metrics? Start by having strategic conversations throughout the organization, not just in the C-Suite or Board of Directors meeting. Don't ask staff what the organization's vision or strategic focus is. If they can answer correctly, it may only prove they've memorized the vision statement.

Instead, ask questions where the answer given demonstrates a depth of understanding of the vision that results in an intuitively aligned response. In other words, presented with a common "what if" scenario in the organization, does a staff person naturally know how to respond in a way that is aligned organization's strategic focus? Ultimately, if they can recite the vision chapter and verse but don't act accordingly, what difference does it make?

The typical solution to this strategic challenge is to create output metrics. For example, if your area of strategic focus is customer service, you may have a metric that all calls be answered within 20 seconds or less. And these types of metrics are helpful. But they only tell you how you're doing in those specific, measured areas and they only provide a backward glance.

What about situations relating to customer service that are unanticipated? If we focus only on the areas where we have metrics in place, then those being measured won't venture "outside the box" of measurement.

In order to ensure that aligned action is taken even when unanticipated issues arise, those responsible for strategy implementation have to have a broader context, which encompasses an array of actions they can take that fulfill the "spirit" of the strategic focus, rather than the "letter" of a checklist of items upon which they are measured.

In the next post, I'll provide more detail on the "how-to" of developing context, as well as alignment metrics.

Strategic Planning is Old School

As I've explained in this series, strategic planning is an old school approach that is not strategic and focuses leadership in the wrong place. Let's look at the fundamentals of the "new school" of strategic leadership.
We'll begin by replacing the "Strategic Planning Pyramid" with a "Strategic Leadership Pyramid," both illustrated below for comparative purposes.
As stated in previous posts, what we've been calling "strategic planning" is really operational, not strategic; it is, in fact, project planning methodology. And this methodology is fine when it is applied to project management. In fact, it's the best approach to take when hard deadlines exist and detailed action plans are critical. For example, it is ideal for planning conferences/trade shows, product launches, construction projects, marketing plans, publications, etc. Anything that has logical steps, firm deadlines and lots of details.
But it's the wrong tool for strategic leadership. Values aren't steps in a plan. Vision is not a project and it doesn't have a deadline. A strategy is a choice, a focus, not a destination, and it requires an agility that a written plan can't provide. Organizational culture doesn't operate using goals, objectives and action plans. Attitudes and mindset can't be effectively influenced by a plan.
But the opposite is true. Execution of vision, strategies, goals, etc., is influenced by organizational culture, attitudes and mindset -- particularly if they are unsupportive.
What are vision/values/culture driven by? People. Not process. Therefore, the most effective approach to ensure vision execution is one that is people-focused, not process-focused. That means focusing on mindset (people), not goals/objectives and action plans (process).




In a previous post entitled "Leadership Needs to Focus in the Right Place to Build a Strategic Organization" I stated that with traditional strategic planning approaches, an inordinate amount of time is spent on management/operations activities where leadership should spend NO TIME AT ALL, and strategic planning methodology quickly shifts the focus from leadership to management.
You'll note that none of the activities in the Strategic Leadership Pyramid include goals, objectives, action plans, key performance metrics, etc. If those who execute on vision (including top leadership) want to use goals, objectives and action plans as part of their operational methodology for executing on vision, great. Goals, objectives and action plans are good tools for personal time management, as well as focusing team activities when accomplishing complex projects.
But as I've also previously written ("I Still Say Strategic Planning is a Flawed Concept"), planning and goal-setting methodologies are just one among many tactical approaches to taking actions aligned with organizational vision, and not always the best approach.
Explaining the Layers
Aspirational Culture is at the top, not Vision. Why? As I explained in "Alignment Comes Before Vision," the "way we do things around here" supersedes desired outcomes. By necessity, leadership focus must begin here. "Aspirational Culture" means the desired way we work together as an organization. Before we begin crafting vision statements, we need to be sure we have clarity on the organization's "personality," the unwritten rules of behavior. We should know in advance of crafting a vision whether the organizational culture will support it. If not, we need to work on building our aspirational culture first.
A note of caution here. It's tempting to judge organizational culture traits as "good" or "bad." For example, if you are a creative, daring and innovative person, you may view an organization with a culture that is conservative and risk averse as "behind the times" or "unwilling to step out of its comfort zone." However, such an organization might be highly effective and successful if its vision plays to its culture. For example, even though it may not be innovative, perhaps it creates traditional, timeless quality products with unparalleled craftsmanship, which gives it a competitive edge in the market.
What makes organizational culture problematic is when it lacks alignment on identity, values, ethics or trust. To illustrate a lack of alignment on identity, I'll go back to the previous example. If leadership and fraction of the staff is daring and innovative but the vast majority of the organization is conservative and risk averse, the ability to find alignment around a vision focused on innovation will be highly compromised.
Vision and values are among the few items from the Strategic Planning Pyramid that remain on the Strategic Leadership Pyramid. They belong there because they are aspirational and inspirational, not operational or tactical.
Strategic focus areas are another area of crossover. Obviously, strategies are strategic. Enough said. But, for further thoughts on strategy, see "Strategy, Plain and Simple" and "Haiku Strategy."
Co-creating and telling the story means, let's describe vision and strategic focus in a compelling story format that is memorable and actionable. And the story needs to have specific relevance. That means, it's not just leadership's story. As the office receptionist, I know my part of the story, and it's personal, not general. And I can articulate it and play the role, too. I'll get into further detail on how to do this in future posts, but I touch on the concept in "Developing Intuitive Alignment."
Last -- and this is where strategy gets operationalized in case you're wondering how strategic focus becomes manageable and measurable without the goals, objectives, action plans and the like -- is Ongoing Strategic Conversations. Instead of going back into an operational, project management-type approach, this approach requires ongoing strategic conversations with the operationalizers. The conversations focus on inputs, not outputs. They involve asking questions that surface incorporation of the vision and strategies into the various roles in the organization. I'll go into detail on this in future posts, as well.
In short, this approach provides a blueprint for keeping leadership focused in the right place -- on leadership (people), not management (process).

Alignment Comes Before Vision

Typical management methodology has leaders develop a vision and then work within the organization to build alignment around it. The order is backwards; before creating vision, create alignment.

As I said in my last post, I'm offering a viewpoint counter to prevailing wisdom about strategic leadership. Not only am I advocating abandoning strategic planning methodology entirely, but many of the foundational management principles upon which it is based. This includes the ubiquitous "strategy pyramid," which has at the top "vision/mission" working down to goals, objectives and action plans.

Vision is not at the top of my strategic leadership pyramid, and goals, objectives and action plans aren't on it at all (read my previous posts if you want to know why).

So, if you don't have vision at the top, then what the heck are followers "aligning" around, you might ask? Aspirational culture. Organizational culture dominates behavior. What's more important than where we're going is how we intend to work together to get there. To create a strategic organization, we need to reverse the order: first create alignment, then create vision.

Knowing this, our first order of business ought not to be choosing our destination port, but making sure the crewmembers have shared values about how we're going to work together on the ship. We don't want to discover we have the ingredients for a mutiny in place after we've already set sail.

In Good to Great, Jim Collins explains that the companies that made the transition from good to great focused first on who (alignment), then what (vision). Getting the right people on the bus first was more important than having the right business strategy. As he put it, in a great organization, people want to be on the bus because of who else is on it. Or, to say it another way: it's about the journey, not the destination.

One thing (among many) that differentiates strategic alignment methodology from strategic planning methodology is keeping in the forefront “who, then what.” This means before even coming up with strategy, first examining whether we have alignment in relation to how we work together.

In my post Beyond The Plan: A New Approach to Strategic Leadership I offered a well-known quote often attributed to Peter Drucker: "Culture eats strategy for breakfast." And proferred that, like individuals, organizations have personalities, which we commonly refer to as "organizational culture."
How often do strategic planning efforts fail due to lack of execution, organizational culture, etc.? Afterwords, leaders wring their hands trying to figure out how they could have better communicated the vision, overcome the cultural hurdles and employee attitudes about the strategy. They engage in futile "change management" exercises, etc.

The problem is they’re trying to “reverse engineer” the personality and unwritten rules of the organization, taking apart what they have, trying to rebuild it to fit the vision. That’s hard work -- quite often futile -- and I’m not a fan of working harder, but working smarter.

The reason we want to take time to clarify organizational culture -- the rules of engagement --first, then align vision to organizational culture is 1) it's a lot less work and 2) people will intuitively act in alignment with the vision if it aligns with the culture. In other words, they will act in alignment with organizational vision and strategy automatically if they're aligned with "the way we do things."

If "the way we do things" is destructive or dysfunctional, before attempting vision, leaders need to work on building the aspirational culture.

Leadership Needs to Focus in the Right Place to Build a Strategic Organization

The graphic below clarifies why traditional strategic planning methodology misses the mark in terms of leadership focus, and shows where leadership focus should be. This isn't rocket science, but for some reason it's a concept that not only many, but most, organizational leaders seem to be missing (including me until recently).

Typical strategic planning session focus areas are highlighted below. Note that the majority of the highlights fall in the right-hand column, labeled “Management/Operations,” not the left-hand column labeled “Leadership.”

The un-highlighted areas are generally left out of the process or, if discussed, only in relation to creating and implementing the plan.

Most strategic planning processes/retreats start with things like a SWOT analysis, environmental scans, etc. , to help determine the strategic choices. This is followed by creating or re-examining the vision/mission, then developing some areas of strategic focus, creating goals/objectives, and may even go so far as developing action plans.
The areas of focus for strategic leadership are found solely in the left-hand column. (Note that planning is in the right-hand column.)

It should now be clear why strategic planning methodology fails to build a strategic organization. True strategic leadership activities are either skipped or given short-shrift at best, and an inordinate amount of time is spent on management/operations activities where leadership should spend NO TIME AT ALL. Strategic planning methodology quickly shifts the focus from leadership to management.

When a leadership retreat is held, instead of shifting the focus to management/operations activities, the entire focus should remain on the leadership side, NEVER venturing into the right-hand column. Ever.

The right-hand activities are for mid-management and staff, and in nonprofit organizations, this would include committee chairs and volunteers. When building a strategic organization, the left-hand side is where leadership, the C-Suite/owners/Board of Directors, should be focused like a laser.

And executive leadership should not only stay focused on the left side, but build capacity within the rest of the organization to shift its focus to the left-hand side. That's an important piece often left out. Leaders by nature have a visionary, strategic-focused mindset and attitude, but often fail to build capacity in the rest of the organization for a strategic leadership focus.

The un-highlighted activities in the left column are the ones that build organizational capacity for strategic leadership at all levels. Ultimately, we want what we do as an organization (behavior - mission/tactics) to be aligned with who we are (mindset - vision/values/strategic focus).

Leaders need to focus on reminding us of who we are as an organization; aligned actions will follow automatically if all stakeholders have an ingrained, intuitive understanding of this.

How many times do we as leaders complain of getting bogged down in operations, losing sight of the "big picture?" We say to ourselves, wouldn't it be great if we could work on the organization, rather than in it? It stands to reason, if we're getting sucked into operations, then what about the people in our organization whose only focus is operations? If we don't take the time to build strategic leadership capacity in them, they'll never get out of an operational focus, which they must do in order to take thoughtful actions aligned with the vision.

Since we now know where our focus needs to be to provide strategic leadership, we'll take a look at how to keep it there in upcoming posts. In my next post, I'll be offering a thought that goes counter to prevailing wisdom about creating vision.