Your strategy has been set.
After months of research and analysis… interviewing customers, spying on competitors, brainstorming with execs and getting feedback from the gods on the board… the plan is finally complete.
The road to success looks clear. You start driving changes. Beginning with a town hall speech on Monday morning.
Yet a month into execution, you notice a BIG problem: People are not engaging with the strategy.
Nobody has changed their priorities. Teams still work in silos. Leaders keep playing politics. Worst, many team members don’t trust each other, actively avoiding collaboration.
People are not engaging with your strategy. They don’t believe in it. They don’t see how it will lead to success.
1. Your strategy is out of touch
The view from the top can be foggy.
As CEO, your perspective of problems faced on the ground can be out of touch with reality. Especially if you only spend time going from meeting to meeting with top execs and board members, who are just as clueless as to what’s happening.
The same goes for your helpers, the strategy planners and analysts. They don’t work in front-line departments they analyze so closely.
Dashboards and reports cannot not replace the qualitative context frontline managers and employees have about the problems facing the company and what should be done about them.
Take Mattel: The company selling Barbies and low-tech toys was finding it hard to compete in 2015 and fired CEO Bryan Stockton. At the time, the company’s toys were losing touch with an increasingly digital entertainment arena and progressive parents who don’t want their children to be boxed in as Barbie. Mattel was out of sync with the lifestyle and values of the kids they serve. I wonder how much time Mr. Stockton spent watching children play while designing his strategy.
The best strategies are designed by people on the frontline. As strategy researcher Henry Mintzberg explores in The Rise and Fall of Strategic Planning:
“…effective strategy making under difficult circumstances requires either that the formulator be the implementor or else that the implementors take personal charge of the formulation… the power over the process must rest with people who have intimate sense of the context in which the strategies have to work. Either the leaders must be able to probe deeply into the organization or else people inside the organization must be able to influence the strategies that are formed.”
Among the rare leaders who do get the importance of staying in touch with reality, we find Aramark CEO Eric Foss, who shared in an interview that:
“…a big part of my calendar, is blocked, to stay close to the marketplace, listening to clients and consumers and understanding what their needs wants and desires are and to make sure I understand ultimately what that front line associate needs at Aramark.”
2. Your plan is not a strategy
Not all plans are strategic.
“Strategy” is becoming a buzzword in the business world. Any deliberate action or change can be called a strategy these days. That’s wrong.
Doing more and doing everything is not a strategy. Taking on new opportunities without de-prioritizing or canceling existing priorities is not a strategy. Such plans will overwhelm the organization.
People are already busy. If we ask more from them without being clear about what initiatives to stop, they will keep doing what they do, and feel guilty about never getting to the new stuff.
Strategy is about making choices. Making trade-offs. In the words of strategy researcher Michael Porter in What is Strategy:
“Trade-offs are essential to strategy. They create the need for choice and purposefully limit what a company offers.”
A strategy exists when we know what we don’t want and what we are not. A clear sense of direction and purpose emerges from saying no.
A good example is Netflix’s vision statement. It clearly notes what it is not:
Netflix is a global internet TV network offering movies and TV series commercial-free, with unlimited viewing on any internet-connected screen for an affordable, no-commitment monthly fee. Netflix is a focused passion brand, not a do-everything brand: Starbucks, not 7-Eleven; Southwest, not United; HBO, not Dish.
We don’t offer pay-per-view or free ad-supported content. Those are fine business models that other firms do well. We are about flat-fee unlimited viewing commercial-free.
We are not a generic “video” company that streams all types of video such as news, user-generated, sports, porn, music video, gaming, and reality. We are a movie and TV series entertainment network.
3. People don’t agree with your priorities
A plan of action is great, but if people don’t understand why these actions are important, they will not adopt them. They will keep doing what they believe to be most important (i.e. what they’re already doing).
In Start with Why, leadership coach Simon Sinek argues that the best leaders drive change by first explaining why. By giving people a purpose. A reason.
Without giving a clear purpose behind your strategy, people will find their own. Often from rumors. Ranging from you’re trying to make your mark as a new CEO to “Great, we’re trying to be like competitor xyz now.” If those imaginary reasons don’t align with their view of what’s best for the company, they are unlikely to agree with your priorities.
As consequency, line managers will wait it out. They will agree with you in meetings, but keep working on their existing initiatives and stall proposed changes. The plan is to wait for this strategic plan to fail and move onto the next one (hopefully more aligned with their vision).
How do we make sure people engage with the strategy?
The formula is simple, but as with all things simple, will be difficult to execute:
- Let frontline managers and team members propose solutions to the problems the company faces.
- Make choices and trade-offs to focus the entire organization on the few objectives and solutions that will create a competitive advantage. Say no to distractions.
- Explain why the few objectives were chosen, and more importantly why the rest of the proposed ideas are not priorities.
This strategy design process ensures the plan is in sync with what frontline teams believe is best. It allows frontline leaders to participate in strategy and gives them ownership and accountability.
Once the range of strategic options has been identified, top leaders need to make choices. With a holistic view of challenges facing the organization, they need to decide on what’s most important and allocate resources accordingly.
Finally, with strategic choices made, leaders need to justify their priorities. Why are we going to open a shop in India, but not China? The goal is to win over skeptics and get everyone onto the same page.
To work together as one team.
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