Why Implementation Matters

We all know intuitively that growth is good. It creates healthy companies, opens up opportunities, and excites talent. Without it, companies cannot deliver the continuous increases in revenues and returns that shareholders demand

May 2011 | by Daniel Burk

If senior executives wait for the full impact of global forces to manifest themselves at both the industry and company level, they will have waited too long. Today, the biggest business challenge is responding rapidly to a world in which the frame and basis of competition are constantly changing. Any effort to set corporate strategy must consider more than traditional performance measures. Managers must also gain an understanding of powerful external forces and the trends those forces can unleash.

Business strategy involves the integration of design, structure, and people to support the implementation of processes and therefore goes beyond the traditional tinkering with “lines and boxes.” Today, it comprises the processes that people follow, the management of individual performance, the recruitment of talent, and the development of employees’ skills. When the organizational design of a company matches its strategic intentions, everyone will be primed to execute and deliver them. The company’s structure, processes, and people will all support the most important outcomes and channel the organization’s efforts into achieving them.

When do executives know that an organization isn’t working well and that they need to consider a redesign? Sometimes the answer is obvious: say, after the announcement of a big new regional-growth initiative or following a merger. Other signs may be less visible—for example, a sense that ideas agreed upon at or near the top of the organization aren’t being translated quickly into actions or that executives spend too much time in meetings. These signs suggest that employees might be unclear about their day-to-day work priorities or that decisions are not being implemented. A successful organizational redesign should better focus the resources of a company on its strategic priorities and other growth areas, reduce costs, and improve decision making and accountability.

We believe that companies can learn from other successful business strategies. By combining the results of our research and the insights we’ve gained from working with multiple companies on these issues, we’ve identified nine core processes. They cover everything from early alignment, redesign choices, and reporting structures to performance metrics, the nature of effective leadership, and the management of risks. The following are highlights of a few of our clients' biggest deals and greatest successes—and the role we've played helping them achieve their objectives and prepare for the future.

Building a Core Team

From the very beginning of a transformation, employees at every level of the workforce—from regional managers to associates—must feel they have a voice in the project and can contribute to shaping the solutions. Employees’ early involvement helps create the conviction, momentum, and passion to effect change.

Too many companies make the mistake of imposing solutions developed by a small, exclusive team from corporate headquarters. A better approach is to establish a core team that includes handpicked managers, district managers, and staff from the central functions, so that every part of the organization is represented from day one. This team of high performers should remain intact for the duration of the effort.

Company executives may object that the size of such a team would be unmanageable and would slow down decision making. Experience has convinced us, however, that the trade-off is worth it. A larger, cross-functional team may add complexity at the start of the project, and achieving alignment may initially take longer—but these risks are a small price to pay for the co-created solutions and organization-wide buy-in that a team can generate.

Invest in a Capability-Building Program

Many companies zero in on one question during implementation projects: “Which operating procedures are the best for us?” Once they’ve identified those procedures, their attention level falls and they end up underinvesting in training the workforce to put those new procedures in place. In our view, the more important question is, “How can we mobilize our entire workforce to adopt the best operating procedures?”

The most advanced companies employ a blended approach to training—one that combines classroom-style learning with practical application and rigorous assessment. We’ve found that the ideal training mix is roughly 20 percent theory, 70 percent practice, and 10 percent assessment and evaluation. To train employees on a new process, for example, 20 percent of training time could be spent explaining how the new process differs from the old one, what problems it is meant to solve, and exactly how it solves them. Some companies, to guard against the common problem of managers feeling ill equipped to train employees, create detailed how-to manuals and training handbooks. One companies used colorful comic-strip illustrations to show a new process.

Prepare for Continuous Improvement

Once initiatives are implemented, the change effort does not end. To be sure, there will always be opportunities for quick wins, but lasting improvement does not come after a few weeks of training or a few months spent identifying waste. Companies must foster a culture of continuous improvement. Everyone from the front line to top management should be responsible for initiating new improvement ideas. For managers, this creates an imperative to spend time observing what is happening on the front line; reports generated by others are no substitute for first-hand observations. Managers should also set a new tone, one that represents the new standards to which everyone is expected to adhere, and create a work environment that fosters teamwork, discipline, and enthusiasm.

 

Oracle Primavera Perspectives

 

Executive Editor

 Ms Anna Sullivan

Ms Anna Sullivan