B2B - Strategy Tools - Part 17

Aligning Organization with Strategy and Culture

In their book: " Executing your Strategy: How to break it down & get it done" Morgan, Levitt & Malek describe 4 traditional ways companies organize themselves depending on chosen Strategic Focus
_______________________________________________________________
Technology Focus & Disruptive Innovation Strategy

• New technologies continue to emerge.
  
• Customers are responsive to new products or services that offer unique new solutions.
  
• Unique creative skills of key employees are seen as key to success.
  
• Examples could be eBay, Amazon.com and other web application based companies.

"Skunk Works" Organization & Cultivation Culture
The Cultivation Culture places a high value on recruiting, retaining, and nurturing highly creative employees to produce unique products.
To conceive, develop and prototype the next disruptive innovation....... (these) companies must create Skunk Works, sometimes also called Tiger teams - semi autonomous mini divisions or true corporate spin-offs that share the parents' high-level goals and can access all of their considerable resources but that have the freedom and flexibility of start-ups. This is done by creating formal or virtual groups that have a respected leader, a simple and highly informal structure, and the financial backing and marketing clout of the large parent organization.
_______________________________________________________________
Customer Focus & Customer Intimacy Strategy

• Existing technologies are beginning to mature but new technologies do come up.
• Responsive delivery of customized products or services are required.
• Strong cross-discipline coordination between employees is seen as key to success.
• Examples could be custom home builders and some OEM-suppliers.

Strong Matrix Organization & Collaboration Culture
The Collaboration Culture places great value on understanding the unique needs of each customer.
The Strong Matrix Organization promotes the responsiveness and agility that are required for customer intimacy strategies and in fast changing markets. In a strong matrix structure, workers receive primary day-to-day direction from their product line or project managers, with only occasional direction and supervision from functional specialists.
____________________________________________________________
Product Focus & Product Leadership Strategy

• Improvements primarily come in existing technologies.
• Customer needs are fairly stable but customers are open to improved solutions.
• Deep technical expertise is seen as key to success.
• Examples could be some pharmaceutical firms and makers of standardized manufacturing or testing equipment based on complex technology.

Weak Matrix Organization & Competence Culture
A Competence Culture values technical excellence above all else.
Workers in Weak Matrix Structures are generally assigned to multiple product lines or projects. They receive their primary direction from their functional manger, who helps them mediate among competing demands for their time.
_______________________________________________________________
Function Focus & Operational Excellence Strategy

• Only a few improvements and mostly in existing technologies.
• Customer needs are stable and there is little demand for new types of solutions.
• Operational excellence and control are seen as key to success.
• Examples could be package delivery companies and insurance firms.

Traditional Hierarchy Organization & Control Culture
A Control Culture values order and security above all else.
The Traditional Hierarchy Organization may avoid the matrix altogether: the additional managerial overhead of coordinating multiple dimensions exceeds the benefits of either a weak or a strong matrix structure.
______________________________________________________________

What is your Strategic Focus, how is your culture and how have you organized your company?
Maybe you should organize differently and "Change the name of the game" - I will describe one such example in a coming post.

PETER SØRENSEN

B2B - Strategy Tools - Part 16

Value Based Leadership

What is the role of corporate values in strategy formulation and implementation?

As I wrote in Part 2 (Strategy on-line: About this blog), values are according to Collins & Porras:"The organization's essential and enduring principles - a small set of general guiding principles: not to be confused with specific cultural or operating practices; not to be compromised for financial or short-term expediency."

In other words values describe how we do things whereas strategy as defined in Part 3 (Business Strategy - definition) describes what we do towards and with whom.

In 2004 Booz Allen Hamilton and the Aspen Institute conducted a global study of corporations in 30 countries and five regions. Senior executives of 365 companies were polled and it was found that 89% of companies had written corporate value statements.

(The Value of Corporate Values by Reggie Van Lee, Lisa Fabish and Nancy McGraw)

So what are the values that these companies include in their Corporate Values?

1. Ethical behavior/integrity (90%)
2. Commitment to customers (88%)
3. Commitment to employees (78%)
4. Teamwork and trust (76%)
5. Commitment to shareholders (69%)
6. Honesty/openness (69%)
7. Accountability (68%)
8. Social responsibility/corporate citizenship (65%)
9. Innovativeness/entrepreneurship (60%)
10. Drive to succeed (50%)
11. Environmental responsibility (46%)
12. Initiative (44%)
13. Commitment to delivery (41%)
14. Adaptability (31%)
    

But more companies are going well beyond simply displaying values statements: They are engaging in values-driven management improvement efforts. Among those efforts are training staff in values, appraising executives and staff on their adherence to values and hiring organizational experts to help address how values affect corporate performance.

Personally I believe that the value of Corporate Values lie not in listing as many "right" values as possible but in the identification and selection of the few key values that truly reflects the owners, top management and key employees basic business beliefs as well as fulfil basic customer needs.

Value goals should be set, included in the Key Performance Indicators (KPI's) and performance should be meassured and acted upon.

PETER SØRENSEN

B2B - Strategy Tools - Part 15

Employee alignment with strategy

So by now you have a strategy that is "clear as crystal" and an organisation that "fits like a glove" with the strategy; but how do you get " a winning team of employees with the right competencies"?

In Part 14:"Organizational alignment and building a Leadership Brand" I wrote about the importance of employing and building the right leaders throughout the organization. Leader's who through their: "knowledge, skills, and values focus employee behavior on the factors that target the issues that customers care about"

To help you and your leaders in that process you may find the below tool useful:

Click on image to enlarge

Each and every of your leaders should evaluate their employees based on the degree to which their competencies (Skills, knowledge and experience) and their motivation (values,dreams and interests) are in line with your company's values, strategy and their present position in the organisation.

The graphic may be useful in a discussion with your leaders about to what extent you have " a winning team of employees with the right competencies" and even more importantly suggestions as how to help develop your employees.

It is of course also a good idea to discuss with and get input from your employee to his or her individual position on each of the 2 parameters.

Peter Sørensen