O F FO C U S E D O R G A N I Z AT I O N S the-business resources. Some of these resources will occasionally work full-time for the change-the-business activities, with management making the decisions and setting the priorities. Top management has also to split its time between managerial activities, participate as project sponsors, in project steering committees, and deal with such day-to-day operational activities as sales meetings. Because they have set the business’s priorities, they know how to distribute their time most effectively.
Competitive mindset The focused company competes with the outside world rather than internally. Internal competition, which is so negative in the long-term, is eliminated because all of the organization’s effort is placed on doing what it does best. The chief executive and top management explicitly identify rival organizations, often referring to them in their speeches and communications to the company. The focused company is also very clear about how to beat the competition. In fact, there is only one way: creating better products and delivering better services. A high degree of innovation is a key and common characteristic of a focused organization. In addition, the employees of such companies tend to have winning attitudes. They are talented and ambitious, and want to progress in their careers. Unlike employees in unfocused organizations, they do not compete with their fellow employees because the focus on outside forces is so strong.
Urgency Creating a sense of urgency is a competitive advantage. Urgency is also needed to focus people and encourage them to give their best performance. Ensuring that employees are very familiar with the key strategic projects selected by top management helps to build this sense of urgency. Employees know they cannot postpone their work, and that they have to deliver on time. Clear deadlines, fixed goals, and knowledge of the importance – and
benefits – of each strategic project are tools with which to infuse the entire organization, both management and staff, with urgency and focus. These techniques also provide the sense that things are moving faster, almost as if the tempo at which the company usually works is doubled or tripled. People work harder – and results are achieved more quickly. One point to take into account – and a real warning for top management – is to impose the sense of urgency carefully. This is probably the most important risk of a focused organization: putting too much pressure for too long on the staff and the organization – what I refer to as aggressive focus – can bring amazing short-term results but in the long-term is not sustainable.
Strategic alignment Every initiative should be linked to one or several strategic objectives. Any initiative that is not so linked should be immediately cancelled. This alignment is necessary to ensure that the company achieves its stated goals. Having only a few key projects is the best contribution to strategy achievement. For example, recently a consumer goods producer decided to acquire a company in China that built and sold ironing machines. This project was perfectly aligned with the company’s strategy, which was to have a presence in China and to increase profits coming from that region by 20%. The company successfully acquired and integrated the Chinese plant, which immediately provided a 30% profit coming from the Asian region.
Excellence A focused organization applies the highest standards to everything it does, and its products and/ or services are known for their quality. Sustainable excellence requires attention to the details of every aspect of the organization: values, quality of employees, internal and external processes, products and customer service. The key strategic initiatives are managed by and staffed with the most capable people. Both the project sponsor and the project team are selected based on which employees throughout the organization will be the
best at driving the initiative. This approach leaves little room for internal politics.
Discipline Discipline should not be seen as something negative that inhibits innovation. Rather, innovation depends on discipline. Companies should clearly distinguish between the time set aside for creativity and time allocated to strategy execution. Focused organizations are able to make this distinction and to move from the creative phase to the execution phase very quickly. If companies spend too much time on innovation, they will be too late to execute their strategy. The challenge for the chief executive and the company’s entire management team is to find the right balance between discipline, creativity and flexibility. Discipline for the staff means that once the strategic project has been approved by top management, it should be meticulously executed without being repeatedly questioned. This does not mean that there is no room for discussion, especially if the project faces unexpected issues during the design or implementation phase; but the project selection should not be further debated. One final, and very important, aspect of discipline in a focused organization is that required by the chief executive and top management when waiting to see results. Many of the benefits of strategic initiatives are not seen until the mediumto long-term, and management must be patient to achieve the bigger results. Too much pressure on short-term results will eventually be harmful. The benefits of becoming a focused organization are significant and varied. Everybody in the focused organization, from the chief executive to the accounts payable employee, knows the direction in which the organization is going; which two to three initiatives are the most important for that year; and the business case for these few critical initiatives. And the benefits can appear very quickly on the company’s bottom line. Costs are reduced when irrelevant projects are cancelled, adding up to huge savings. There are many more likely benefits. The question is whether your organization can continue to ignore them.
Q3 2017 Dialogue