How to Steer Your Company Away From its Own Fiscal Cliff

You’ve hired a ton of talent. You have a great product. You have the best marketers in the business. And as the business owner / CEO, you have a persistent vision of excellence, and you know it’s all there right in front of you.

But something just isn’t clicking…

Communication is poor. Marketing’s message seems to be off and not jiving with potential customers. Features are being added without much thought. It seems like everyone is going off in their own directions.

You feel like you need to stop and take a few steps back.

That’s a really good idea.

In today’s post, we’re going to pause for a moment and put all the marketing tips and articles on analytics on hold. We want to examine a very important issue called company alignment. It happens to be an important task that every company needs to do carefully and not gloss over.

Skipping this important step could mean the difference between success and failure. And since we don’t like failing, let’s jump in and see what it’s all about…

Redefining the Idea of Leaders and Managers

Back in 2006 I attended a presentation given by business author and former Gallup researcher, Marcus Buckingham. One of the highlights of his presentation for me was how he defined the difference between leadership and management.

Up until then, much of the business literature seemed to imply that leaders and managers were two different types of people, and that leadership was a “good thing,” but that management was a “bad thing” and some kind of throwback to the industrial age. Somehow the term “manager” had become a dirty word that no one wanted to be associated with.

The reason for this was a high profile (but unhelpful) business book that was wildly popular at the time. The book implied that leaders were future-thinking, risk-taking visionaries who motivated and inspired people, whereas managers were an inferior breed of controlling, stability-minded administrators.

Buckingham set the audience straight. He explained that leadership and management are functional roles that need to be performed (not a statement about what sort of person you are). And both functions are vital to business success.

The Role of Leadership

According to Buckingham, leadership is about painting a picture of a better future, specifying the actions that need to be taken, and rallying people to work toward achievement of their part of the whole. Leadership is often a one-to-many endeavor, focused on making sure the company chooses the right strategic moves, and that people’s goals are aligned to those moves.

The Role of Management

Management, on the other hand, is about getting great performances out of people by helping them to realize their potential. To obtain this, you need to figure out what each person’s unique strengths are and coach them to fully develop and leverage those strengths. Management is most often a one-to-one endeavor, focused on making sure that everyone in the company is executing the strategy effectively.

Some people are great at leadership, but not management, whereas others are great at management, but not leadership. A few rare individuals are great at performing both functions.

Most people aren’t wired to perform either function well, and that is perfectly fine. We need lots of specialists and experts who can focus on performing their specific roles to a high standard, without having to worry about either leadership or management.

Getting Everyone on the Same Page

Regardless of whether your job involves leadership, management, or being a specialist in a specific role, it is vital that everyone in the company is “on the same page.” By that, I mean everyone in the company knows and understands your answers to the following questions:

  • Core Values – What are the rules that define your culture and guide the behaviors of everyone in your company?
  • Core Purpose – Why does your company exist (beyond simply making money)?
  • BHAG (Vision) – What is your Big Hairy Audacious Goal (or compelling vision) that describes what your company will look like in the future when you are a truly great company?
  • Target Market Customer – Who do you serve? What customer group will you focus on? What are they trying to accomplish? How will you address their needs?
  • Core vs. Non-Core Activities – What activities do you need to start doing and stop doing?
  • Strategic Positioning – What market category do you want to “own” in the mind of your target customer?
  • Key Benefits – What are the functional, economic, and emotional benefits you will offer?
  • Brand Promise – What is the blunt, overt promise you will make to your customers?
  • Long Term Strategic Moves – What trends will determine how your industry is likely to play out in the coming years, and what moves do you need to make to position your firm for future success?
  • Numerical Targets – What goals and milestones will measure your success along the way?
  • SWOT Analysis – What is your current reality (strengths / weaknesses / opportunities / threats) in relation to the long term moves you want to make?
  • Current Strategic Priorities – What key projects are you working on right now to address your current reality and move the company in your chosen strategic direction?
  • Key Performance Indicators – What key metrics will drive the success of your current model?

Getting everyone on the same page requires going through a disciplined strategic thinking and decision making process to answer such questions, and then capturing them on a “One Page Strategic Plan.” And, yes, you really can get all of these answers onto one page!

Working Together

Once you have everyone on the same page, your company starts to perform in a way that is analogous to that of a rowing crew in the Olympics. The goal is to make sure you navigate through the qualifying rounds and ultimately cross over the finish line first in the final event to win the gold medal. The coxswain calls out the tempo of the rowing strokes. Everyone in the crew is rowing in perfect time and the boat slices rapidly through the water.

The gold medal crew has a plan for every race. They stay focused on the execution of their race strategy even though they can see their competitors jockeying for position in their peripheral vision. They maintain their fast, synchronous cadence – a fast, even tempo for the duration of the race – even when they are tired and don’t necessarily feel like it.

Just like the rowing crew, effective companies use a disciplined cadence to set and execute their strategy for each race. They have a rhythm that keeps everyone in their company synchronized and executing the strategy at the optimum pace.

What is Strategy?

Unfortunately, many companies think they have a strategy, but usually all they have accomplished is a meaningless exercise in financial goal setting. Goal setting is important, but setting numerical targets is not a strategy. We all want to grow, but growth is not a strategy. We all want to improve our businesses, but improvement is not a strategy. We all want to be more efficient, but efficiency is not a strategy. Yes, we want to be better than our competitors, but beating our competitors is not a strategy either. Bigger, better, faster, cheaper is not strategy!

Strategy is about understanding how your industry is likely to play out, and then getting very clear on the key strategic moves your company needs to make in order to position your company for future success. There are profound changes occurring in many industries. Are you going to be one of the casualties or one of the success stories?

Quarterly Strategic Plan Updates

Strategic planning should be an ongoing process, not an annual event. Things can change in your operating environment so quickly that the traditional annual offsite strategic planning session is seldom sufficient. By all means, go offsite once a year to make plans for what you want to achieve in the coming year, but set project milestones that are in the near term and set a date to reconvene again at the end of the quarter. Ninety days is far enough away to get some meaningful things done if you get your team really focused, and the finish line is close enough to create a real sense of urgency.

Think of strategic execution as a series of ninety day sprints. Use the strategic planning process to get clear on your direction, and then put your head down and sprint for ninety days.

At the end of each quarter, stop to review progress. Also, stick your head up long enough to look around and identify any changes in your strategic environment. Make sure the direction you are heading in is still the right one, or make course corrections as necessary.

Effective companies make the time to stop and review their progress every quarter and learn from it. They ask questions like: Did we achieve our targets this quarter? Did we execute our strategic priorities effectively? What did we learn this quarter? What will we start doing? What will we stop doing? What will we do better next quarter?

Effective companies also make the time to assess the current reality and confirm their key priorities for the coming quarter. This ensures the plan’s continued relevance with the competitive environment, and re-aligns everyone to the strategic priorities.

Now, you are ready to charge off on another ninety day sprint!

It should take you no more than four to six hours per quarter to go through this disciplined process, but it is definitely well worth investing this time to review and update your One Page Strategic Plan and get everyone back “on the same page.”

Make your Plan Visible

I strongly recommend that everyone post a copy of the revised plan on the wall next to your computer monitor, so you can see and constantly be reminded of your company strategy.

In fact, I always ask clients to send me photographic proof that their plan is actually being made visible around their offices. One client even went so far as to send me pictures of their One Page Strategic Plan posted in each of their toilet cubicles! Regardless of where you choose to post your plan, it’s ultimately up to management and leadership to make sure everyone knows what the current company strategy is.

Consider using tools like business execution software to really make your One Page Strategic Plan come alive and track your progress toward your strategic goals in real time.

Do you have a current One Page Strategic Plan? Where is it being made visible right now?

Otherwise, how can you be sure that everyone in your company is on the same page?

About the Author: This guest post was written by Stephen Lynch, the Chief Operating Officer of RESULTS.com – the business execution experts. RESULTS.com offers Business Execution Software and consulting services to help mid-sized growth firms achieve better business results.

  1. I guess, if you are determine for some work and you want to achieve results for your company then you can do it in a passionate way !
    Thank you

  2. nice explanation about the difference between leadership and management. but management is not always dirty. management can be done with passion. but great information in this post.
    Thanks.
    Matt

    • Yeah I don’t think Stephen was saying that management is dirty – it’s just that in the past management always seems to get a bad wrap – and it doesn’t have to be that way. They are obviously important people in an organization and are probably the key to get a company humming along nicely..

    • It is my belief that the front line managers are the most critical people in any organization. This role absolutely needs to be done with passion if you want to fully engage your people.
      Cheers
      Stephen

  3. This is great, thank you! I’m going to consolidate the plan to fit on one page, print, and frame them for the team. This should make a nice Christmas gift lol..

    We stay in sync through Crocagile. It’s something we’ve created for ourselves internally that we want to share and build on, which keeps us forward thinking and communicating in real time.

    Cheers!

  4. hey Lars!
    great post! and Working Together is most interesting part of it. i totally agree with you on every aspect of this post. and definitely reducing churn has great impact on lifetime value.
    Thanks.

  5. I think if you keep on giving the content which your bloggers want then you can get every thing !
    Thank you

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