Tag: Strategy

Focusing on mission – why asking why is where to start

Morry Fiddler is a friend and one of my personal trusted advisors. During one of our recent breakfasts, he recommended the following TED talk by Simon Sinek on how leaders inspire action.

 

Since then, I’ve found myself weaving Sinek’s thinking into my own work and recommending it to others.

I also made a point to get my hands on the book version of Sinek’s thinking: Start with Why: How Great Leaders Inspire Everyone to Take Action.  While it helps fill in some holes in his argument, I think most will find the TED talk more than sufficient to grasp Sinek’s argument and start adapting it to their particular situations.

As you’ll discover, Sinek believes that the differentiating role of leadership is to define and ultimately embed into an organization’s culture a clear sense of "why" the organization exists.

Sinek’s arguments and examples are sufficient to encourage me to make the why/mission question more explicit in my work and I’m already seeing it bear fruit in several settings. Sinek makes an effort to anchor his ideas in what we’ve been learning about the organization of the human brain. While he makes an interesting case, I think it’s a bit of a stretch and not essential to his argument.

What Sinek does do is give you both a framework and some plausible examples to support important conversations with organizations and leaders who are struggling to find their focus.

One deeply informed view of IT as a transformational tool

Blind Spot: A Leader’s Guide To IT-Enabled Business Transformation, Feld, Charlie

In the 1980s a handful of organizations established that the right combination of strategic and technology insights and execution could lead to results worth the attention of CEOs and Boards of Directors. One of those successes was a major transformation in the sales and distribution systems of Frito-Lay during their rise to prominence as a national player in the snack business. Frito’s CIO, Charlie Feld, was at the helm of this effort and was one of the individuals who defined the modern CIO role in the process. After Frito, Feld created a specialty consulting firm that spearheaded similar transformation in a variety of other firms and industries. Blind Spot captures Feld’s reflections on the challenges of using IT as a transformational tool and how to manage them.

The heart of Feld’s argument is this:

Most senior leaders have learned enough about the workings of their businesses to feel comfortable engaging in a new-product dialogue or a complex financial debate or a major litigation. But few have adequate background to understand and lead wide-scale changes that are technology enabled….To most executives, IT is a blind spot–a discipline that is confusing and hard to understand.

My belief is that information technology should not be viewed as a complex functional area. It is an integrating discipline that enables other functions to operate as a seamless, well-run business. Instead of some mysterious black box, IT can be less complex and easier to understand than marketing, operations, finance, sales, and other traditional operating disciplines. This is because it is fundamentally all about the way a business should operate, manifested in information access, workflows, networks, and business rules. And instead of a blind spot, information technology can and should be a highly visible and well-understood part of every business leader’s knowledge base,

(Feld, Blind Spot, p. xvii-xviii)

To tackle that problem, Feld shares a framework he has developed in the course of his efforts to drive IT transformation at Frito-Lay and elsewhere. Like any good framework, it’s simple enough to sketch on a whiteboard or on the back of a placemat, yet it can anchor and center an extended conversation about change. Contrast Feld’s framework with the Byzantine complexity of many systems development methodologies.

 

FeldFrameworkBlindSpot-2010-04-6-1621

The "Journey" that Feld describes is straightforward. The most interesting aspect is his emphasis on time-boxing the phases in order to establish and maintain momentum.  At the same time, he recognizes the importance of taking enough time at the outset, in the Strategy and Turn phases, to get the overall direction and plan directionally correct. His experience calls for these first two phases to take about 90-days each. Subsequent phases are designed to deliver visible results every 6 to 9 months.

The second dimension of Feld’s framework, what he labels as "4 Planks for Change," is where things get much more interesting. This is where Feld devotes the bulk of his attention and he uses his experiences from Frito-Lay, Burlington Northern Santa Fe, Delta Airlines, Home Depot, and Southwest Air to illustrate his approach. These planks address four core questions about a proposed business transformation effort:

  • Why do anything at all?
  • What will we do?
  • How will we do it?
  • Who will lead and manage the change?

The value of these questions is that they are well suited to the debate and discussion that you want to be having in the C-suites and Board meetings about business transformation. They also help redirect the technically enamored from bright shiny objects to business value.

When I try to wrap my head around frameworks or approaches, I always look for is the "perform magic" step. Somewhere among the boxes and flows, there will be one spot where the essential design decision gets made or the case gets cracked or the strategy reveals itself. In Feld’s framework, i believe this essential creative step occurs in working out the What of the transformation Strategy.

Frito-Lay, for example, to maintain its growth, needed to give its route drivers local flexibility over product mix while maintaining close central control over manufacturing and quality. Their solution was to equip drivers with early hand-held point-of-sale terminals that let the drivers manage the diverse range of Frito-Lay products and accurately report sales activities back to corporate on a daily basis. In the case of Burlington Northern Santa Fe, the challenge was to synchronize  the electronic picture of where all of its rolling stock was with the physical reality in near real time. In these, and other, cases Feld deftly sketches the essential strategic What.

There is a common thread in Feld’s strategic analyses. The strategic choice in large organizations is whether to focus on operational efficiencies or customer intimacy. More often than not, this leads to efforts that bounce back and forth between bouts of centralization and decentralization. The strategic promise of IT is to change the answer in these debates from "either/or" to "both" by making a hybrid business feasible. Here’s how Feld describes it:

It is not about centralization versus decentralization–both have their virtues and liabilities. It is about common versus unique processes, standard versus disjointed information, and leveraged versus fragmented IT platforms and networks. If you are common, standard, and leveraged in your systems, data, and processes, you can continuously flex between centralized and decentralized where it is appropriate, like Wal-Mart. However, if those things are unique, disjointed, and fragmented, you are locked into those structures and change is expensive and slow, like Home Depot’s was….It may seem counterintuitive, but the more standardized your systems and processes are, the more flexible you can be.

(Feld, Blind Spot, pps. 144-45)

Feld’s third question is "How will we do it?" Because his primary audience is business leaders, he rightly keeps his focus at an executive level emphasizing the importance of sound architecture, concrete deliverables, and effective program management. These tend to be topics that cause most executives’ eyes to glaze over. In general, Feld makes the case for the relevance of this question as a co-equal part of the transformation process. He avoids the temptation to get caught up in either technical or process minutia. This may annoy some readers, but is the right decision for his target audience.

Feld closes with a look at the critical importance of leadership and management. He strongly favors an IT organization built to reflect stable, core, business processes rather than attempting to mirror more dynamic organizational structures. he sketches a basic IT organization that calls for 50-100 competent leaders. Successful business transformations like those he’s been describing call for a corresponding leadership cadre from the business side of the organization. This is a richer, more pragmatic, view of the leadership demands of this kind of technology enabled transformation than you will find elsewhere.

Blind Spot is a useful synthesis. It’s rooted in the ground truth of its case studies as told by someone who was there, start to finish. From that ground truth, Feld constructs a framework that can shape and guide comparable efforts without forcing them into too narrow a path. It’s most useful for those readers who can bring their own experience base to the task of understanding the framework and making it their own. Given the ongoing role of IT as a potential strategic tool, this is a set of ideas that belong in your toolkit.

 

 

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Thinking in Systems: A Primer

Thinking in Systems: A Primer,

Meadows, Donella

From time to time, I recommend Meadows’ article, Places to Intervene in a System. It’s a succinct summary of her long experience at finding leverage points for effective change in complex human and organizational systems. In this slim volume, she provides an accessible and understandable introduction to systems thinking in general and "Places to Intervene" takes its place as a penultimate chapter.

We spend our days surrounded by and embedded in multiple, complex, interacting systems: transportation, education, health care, our employers, our customers, our suppliers. The systems we encounter are those that by design and by adaptation have found stable ways to operate and to survive.

Thinking in Systems explains why systems work the way they do and why our intuitions about them are so often wrong. Feedback loops drive system behavior. Positive feedback loops give us population explosions and Internet billionaires; negative feedback loops let us steer cars or regulate the temperature in our offices. Unrecognized feedback loops and lag times between action and response lead to most of the surprises we encounter with systems in the real world. What Meadows does here is make that all understandable and accessible with apt examples and clear explanations.

Constraints and innovation – is there a silver lining?

The Silver Lining: An Innovation Playbook for Uncertain Times, Anthony, Scott D.

The Silver Lining is positioned as a case for the strategic value of innovation in economic downturns. It evolves into a reflection on the role of constraints in innovation and on the possibility of successful innovation within large, complex, organizations. Scott Anthony, the author, is a former student and current colleague of Clay Christensen and is President of the boutique consulting firm Innosight. The book was conceived in October of 2008 and the manuscript delivered to HBS Press in January and offers itself as a good example of the value of tight constraints. (Here is the obligatory book website)

The Silver Lining presents a succinct, focused, argument for how to do effective disruptive innovation within existing organizations. This runs contrary to the research conclusions in Christensen’s The Innovator’s Dilemma that linked successful disruptive innovation with new entrants not industry incumbents. The management practices of successful market leaders emphasize the prudent deployment of resources to address clearly understood problems and clearly meaningful opportunities. Those practices are about coloring inside the lines. Disruptive innovation goes beyond just coloring outside the lines to redrawing the lines and creating entirely new pictures.

Anthony breaks his argument into three threads; creating capacity to innovate, applying ‘tricks of the trade’ to generate good innovation options, and grafting innovation skills into existing organizations. In any time, organizations are reluctant to have resources sitting idle. In today’s environment, even prudent levels of slack capacity have disappeared. The first step in creating capacity for innovation, then, is to look at the portfolio of projects and initiatives underway for what can be stopped or redirected. Anthony uses a look at the portfolio as a quick way to introduce and differentiate key concepts of disruptive vs. sustaining innovation. For example, he demonstrates why conventional approaches of ranking projects on expected financial returns such as first year revenues or net present value can select against precisely those opportunities with the greatest long term potential.
 
In his second thread, Anthony highlights approaches and techniques that have emerged as the most powerful in identifying and shaping innovations to reach their disruptive potential. First, he offers way to attend to the external environment and potential customers that make it more likely to find or generate new product and service ideas. These include paying more attention to less-demanding rather than more demanding customers to identify markets where your current products are overkill and a simpler product or service would represent a real opportunity.
 
Finally, Anthony offers advice and reflections on ways to fit disruptive innovation into established organizations that have been designed, in large measure, to prevent and suppress disruption. Here’s how Anthony puts it:
It’s certainly not fear of new concepts and management theories; executives seem to buy and change them as easily as a new set of clothes. But executives demonstrably favor ideas that involve ways to do what they are currently doing in a more efficient, more effective manner. Systematizing disruptive innovation is a different beast. Senior executives have to think and act in ways that run counter to everything they have done to be successful in their careers. As Putz notes, they must be multi-paradigmatic in how they structure their business model, run their firms, lead their teams, and most difficult of all, see themselves and frame their identity as leaders. Simply put, leaders who want to capture the potential of disruptive innovation need to be "consistently inconsistent" with their teams and themselves, and still hold it all together and deliver results quarter after quarter. (pp 154-155)
Improving the organizational environment for disruptive innovation requires updating and adapting organizational processes for selecting and managing a portfolio of innovation efforts. The theory building and experience base that Anthony, Christensen, and others have been developing provides a language system, concepts, practices, and examples to blend into existing organizational systems. How well this will work depends greatly on organizational culture; a topic that Anthony does not address in depth in this short work.
 
Disruptive innovation is a complex notion. It takes multiple passes to grasp its strengths and limitations. The Silver Lining, by virtue of its own constraints, offers an armature around which you can build your evolving understanding.
 
 

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