A key part of strategic performance management is aligning the organisation with the strategy. We help our clients align their organisation with their strategy in a variety of ways. Here are just a few examples.
Aligned Projects & Programmes
If your investments are focused on the wrong things or your projects are delivering the wrong benefits, you are wasting money. Whenever we do project alignment with the strategy, we find projects that are not necessarily supporting it. In extreme cases we have found £40m of a £100m portfolio. In others, the programme was right but the timing and resourcing over ambitious and unlikely to deliver.
Some organisations have well trained project managers but do not provide a culture that supports them. Instead they are fighting for clear business cases, the right resources or a real commitments to the benefits.
Our approach aligns your programme of investment with your strategy. A recent client reported how we helped the project and systems managers to realise the extent of the portfolio of projects, how the projects interacted and worked together, so the project managers could work together more effectively as well.
We recently spoke on aligning projects with the strategy at a public conference.
Whilst many organisations have well aligned senior executive incentives, some fail to align their middle management objectives and incentives with their strategy. Research suggests that perhaps one in four organisations do not have their middle managers’ incentives linked to their strategy. This can clearly hinder deliver of their strategy.
In other cases, the objectives are aligned, but they don’t encourage joined up thinking and working. Instead silos and local optimization continues, when you want to break it down so the organisation works together.
Similar things apply to personal objectives. Explaining the strategy so people can see their role and contribution, makes it easier to set personal and team objectives. As one client put it, “I carry a piece of the strategy around in my pocket now”.
Here is an example of a strategy for an engineering technology group. This was part of the story used to create an overall group strategy from disparate companies. A key element of the strategy was identifying where synergy across the group could be identified and used.
One of the techniques we use a lot is called “Strategy mapping”. The value of these strategy maps is that they describe the strategy very effectively and help you communicate it better. They are also make strategy easier to refine and adapt. You can easily see how similar (yet subtly different) the various strategy maps are. This reflects the diverse strengths of each of the companies in the group.
Example of strategy maps cascading the strategy through an organisation
Drivers of change
When organisations implement a strategy they are usually bringing about change. There are many levers and drivers of change that you might employ. Unfortunately these drivers of change are rarely reflected in the performance management approach. It tends to measure results rather than the influence of change.
You can tell if your strategy is going to work, because we help you understand how your drivers of change are working for you. This allows you to fine tune your pull on these levers and so ensure that the changes happen more quickly and effectively.
The finance and budgeting systems are extremely influential mechanisms in an organisation. So, imagine the situation where you are trying to execute the new strategy, but the budgets are still operating under the old one. Or imagine a situation where you are trying to implement the strategy and the budgets don’t even reflect it. This sounds awful, yet, research suggests that up to 60% of organisations do not have budgets that reflect their strategy. Some organisations are struggling with a strategy that wants to achieve one thing and a set of budgets that are holding it back.
Usually it is not the investments (though it can be). It may be the coding structure or the budgeting process not being flexible enough. At other times you may be asking people to do more with less. If you leave the accounting practices, structures or budgets in place, they can do a marvelous job of contradicting and undermining your strategy. It is not just the capital investments and change programmes that need appropriate funding: The operational budgets need to be tackled as well. More on aligning budgets
Often our clients complain that their meetings concentrate too much on operational issues, rather than the bigger picture. We help them plan and run meetings that focus on strategic issues, progress, risks and resources, as well as managing the operational detail when they need to. They tell us this helps them keep a perspective on what really matters and raises the whole quality of discussion and debate. It also makes meetings sharper, more effective and shorter.
Our clients tell us that our approach can make a dramatic difference to the dynamics of a management team: changes that carry through to their staff and to the end results.
These are just some of the areas where we assist with alignment. To explore what a difference alignment would make to you, or discuss how to align your organisation with your strategy, you can explore our strategic performance management case studies, or talk to us directly.