Hack:
MANAGE WHAT MATTERS MOST

 

My previous paper also published on LinkedIn, “Measure What Matters Most”,  I presented 3 keys to optimize the effectiveness of the measures we use in planning and in reviewing. (1) In this paper I want to focus on what is it that matters most  and how best to manage it.

 

What matters most is that the enterprise be able to sustain superior performances in creating <business value> with and for its stakeholders. <Business value> is created in the interactions between people, insights, and ideas. These interactions and the capitals and the processes that support them should be structured and synergized by a framework that fosters commitment, cooperation, and collective creativity. My <S.P.I.D.E.R> is an acronym for 1. Study 2. Plan 3. Invest 4. Deploy 5. Execute 6. Review. These 6 management processes  connect the processes, the resources, the different actors. (1)

 

My purpose here is to lay out the framework, and to provide some examples. Managers and consultants that use it to direct the full strategy development and deployment process.

 

 

1. Study

 

<Study> involves an analysis of past results, and as suggested in my previous paper also published on LinkedIn, “Measure What Matters Most”. (2)  It is interesting to observe how effectively  the strategic resources, the processes, and the team-work have supported the planned strategic themes. It is interesting to see how these enablers have evolved over time.

 

 <Study> also involves an analysis of the evolution of the forces on the selected markets, and beyond on the business environment.

 

Wayne Gretzky, a famous hockey player said: “I skate to where the puck is going to be, not to where it is now”. Bearing in mind Gretzky’s axiom, managers should look at the evolution of the following factors, namely: the customer purchase patterns, competition, the significant suppliers, and the means and methods of supply. Managers should also look at the organization’s critical capabilities, and at how they could be made to evolve over time so as to enable the enterprise to take advantage of new opportunities or to tame future threats.

 

Andy Grove, Intel’s famed former CEO, noted. “When spring comes, snow melts at the periphery because that is where it is most exposed”. Today, new strategic themes can be found at the periphery where new opportunities emerge, while at the center of the field opportunities tend to be well covered by competition.

 

 

2. Plan

 

<Plan> should review the <study>, and then, based on what has been retained, develop the plans concerning the different corporate strategies, namely: 1. Special situations 2. Business breakthroughs 3. Continuous business improvements of the core business 4. Maintenance 5. Divestments.

 

The leadership needs to articulate the plans for each of the aforementioned five corporate strategies. Moreover, it must ensure as appropriate their synergies and connectivity; it must show the priorities taking into account the risk-reward-timing profile of each of these business strategies. For example, business breakthroughs usually lead to continuous business improvements, but continuous business improvements of the core business must fund the business breakthroughs.

 

Business-strategies should not be narrowly stated. I suggest that the business leaders follow the approach of golf-architects who clearly show the fairway, the roughs, and the out-of-bounds. The roughs should allow ample space for initiatives; the out-of-bounds show the no-go. Of course, business-strategies should not be cast-in-stone, and the process of revision and renewal of business-strategies should be clear, simple, and swift. 

 

Special situations and business breakthroughs can entail substantial risks that need to be supported by the core business and by its continuous business improvements. Moreover, the organization must really be ambidextrous, adaptable, and agile in order to optimize the synergies among the aforementioned 5 corporate strategies.

 

A recent article in The Financial Times reminded that conglomerates are now out of favor. Increasingly, companies focus on the strategic themes where they can sustain superior performances. For example, Philips, a long time a world leader in consumer electronics, essentially dropped out of this business when the field became overrun by low-margin competition. It switched to sophisticated medical devices.

 

So, the CEO and his/her executive committee must clearly put the spot light on the fields and on the countries where and how the enterprise wants to compete, on what it wants to offer to whom, and on where and how it wants to produce and supply. But, like good sailors, the business leaders must be alert to wind changes, and adjust the sails accordingly. Agile Management empowers and entrusts the front-lines to advise when changes emerge on the market places. I also advocate that the CEO set us a <alert & innovation committee> that constantly looks out for broader trends.

 

 

3. Invest

 

The prioritization of the strategic themes should drive the resource allocation process. This sounds obvious, but in practice most senior managers tend to hold on to their resources for dear life. Executive surveys by global consultants show that many companies do not systematically and substantially revise their resource-allocation-process from year to year. That, while perfectly normal, is one of the constraints  enterprises face, and that prevent them from becoming ambidextrous, adaptable, and agile. To avoid this obstacle, Texas Instruments had introduced a system they called “zero budgeting” that called for each business leader to justify the requested resources based on the future rather than on the past plans.

 

Tangible resources make-up the tip of the iceberg of the corporate resources while the intangible resources form the bottom of the iceberg. This image reminds us that the part at the bottom is really the one that supports the whole bloc, and indeed the  intangible resources are the ones that power the dynamism and the innovativeness of the whole enterprise. Yet, when we discuss the process of allocation of the tangible resources, we tend to focus on the tangible resources. What happens with the allocation of the intangible resources ?

 

My <platform of agile management> features 3 internal value-chains, namely: the operations, the support, and the corporate management value-chains. (3)

 

Within the operations value-chain, the links may be too busy to share their intangible resources with other links unless they happen to be closely working together. So, the support value-chain should be the one that provides assistance on the intangible resources. The support value-chain helps the other value-chains, and it should build up and consolidate the centers of competencies. As concerns the corporate management value-chain, it should monitor the development and the deployment of the centers of competencies.

 

 

4. Deploy

 

Traditional organizations involve the senior management in the first 3 steps of the S.P.I.D.E.R., and then targets and means are assigned to the business units. The agile innovative enterprise gets the senior management to work out the deployment with the operations management.

 

In a nutshell, the CEO and his/her executive committee deploy the business breakthroughs and the continuous business improvements, and they ensure the synergies and the creative cooperation among the 3 internal value-chains. Within each of the internal value-chains, the deployment goes down to the networks that oversee several links, and then to the teams.

 

The deployment of the business-strategies focuses on what, how much, when, but it leaves to the teams to determine the how and the what with whom. Of course, the teams can get assistance from the networks, and the networks from the value-chain leadership. In addition, I advocate that, at the level of the executive committee, an <alert & innovation committee> be available to help teams on initiatives that do not fit the usual business.

 

 

5. Execute

 

The agile innovative enterprise deploys down to the teams the tasks that the teams should be able to execute smartly, simply, and swiftly. The teams conduct frequent reviews, and keep other teams and networks informed. In case of unusual problems/ opportunities, all concerned are informed and can contribute as appropriate without unnecessary delays.

 

 

6. Review

 

As discussed in my “From Review to Renew”,  the review-process runs bottom up, and thusly it complements the other steps of the S.P.I.D.E.R. (4)

 

All the 5 business plans get reviewed as well as their synergies and the strengths and weaknesses that have shown up.

 

 

Closing remarks

 

As mentioned in the opening remarks, my purpose here is to lay out the S.P.I.D.E.R., as the advocated approach to setting and to deploying the corporate strategies. The 6 management processes of this model ensure that across the value-chains, across the different levels and functions people work together to optimize the present and the future performances of the enterprise by constantly focusing on managing what matters most.

 

 

Bibliography

 

-1- Willy A. Sussland “The S.P.I.D.E.R. Web of the Management Processes” LinkedIn May 14, 2018

-2- Willy A. Sussland “Measure what Matters Most” LinkedIn August 13, 2018

-3- Willy A. Sussland “The Platform of Agile Management and the Program to Implement It”,

     Routledge 09/2017

-4- Willy A. Sussland “From Review to Renew” LinkedIn June 24, 2018