Strategic Management Insights

March '08

The Universal Framework

I recently returned from a well attended 2-day strategy conference in LA hosted by ASP, the Association of Strategic Planners.  I enjoyed many of the presentations from the strategy experts there, including some from notable firms like Bain and Accenture. 

As I think through what I heard and learned, it clarified for me that there is indeed a simple, universal framework that generates compounding positive results … if we pay attention to it.

These are the five elements of the “Universal Framework”:

Goals – Long and short term (3 to 5 year, annual, monthly, weekly, and even daily), strategic and operational, corporate, departmental, individual.  Start with the end in mind, as Steven Covey advises us.  A goal is a picture of your destination, where you intend to be, so that you have something to aim for.  Peter Drucker said: “The only way to predict the future is to create it.”  I would add to that: “The only way to create the future is to see it first.”

Plans – If our goal is to get to Memphis by next Wednesday, then we need a route mapped out.  Without it we’ll just be driving around.  Plans are the road maps that lead us to the goals (destinations) we set.  Do we take the time to plan?  Most of us know that it pays to plan, but it’s easy to be so busy that we never quite get to it.  Here I’m reminded of the expression: “Failing to plan is planning to fail.”

Standard Processes – Let’s start with the premise that for many business activities there are better (and worse) ways of doing things.  Standard processes make it easier and cheaper to generate more consistent and reliable results.  Michael Gerber, author of the E Myth, calls this “orchestration”.  A good orchestra doesn’t let the violins chime in whenever they want.  And nor should we.  We want to be making music, not noise.  But that doesn’t mean we don’t innovate.  After we discover and test a new way of doing things and it proves to be better, then it’s OK to make it the new standard. 

Measures – Are we doing what we planned to do?  Are we getting the outcomes we expected?  Measures track inputs and outputs and tell us how we’re doing and why things are on or off track.  Without this information at all levels, from strategic to tactical, we’re simply adrift.  Measures are a requisite for fact-based management, which generates smart decisions.  They also often save meeting time that could otherwise be used to argue over opinions and anecdotal information.  Measures can be granular or higher level KPIs (Key Performance Indicators).  And yes, we need access to a lot of data for periodic diagnostic drill-downs.  Absolutely!  But on a day-to-day basis we’re better off with a more limited set of measures that highlight the information needed to keep our finger on the pulse. 

People – People are our greatest asset and our greatest challenge.  I think it boils down to this: hire right, connect to the game plan (strategy), inform, include, develop, challenge, and acknowledge.  Most importantly, let people use their brains.  (“No one of us is smarter than all of us.”)  This means allowing people the freedom to make choices within the context of a game plan and an organizational framework.  Research, including SUMMIT’s 2007 Business Performance Study, indicates that most employees who know the plan, how they fit in, how things are going, are asked their opinion, are given feedback and development opportunities, and have some control over their jobs, are happy and engaged.  A company with mostly happy and engaged employees will outperform an unhappy, disengaged competitor every time.  Today this is a smart approach.  Soon, as the pace of business continues to accelerate, it will be the only way. 

I think that covers it.  Pretty much every business book I read and every management practice I encounter seems to address one or more of the five elements highlighted above.  I know this is not entirely new.  But I hope that by seeing these familiar elements as a framework it will help you focus more clearly on what needs to be done. 

In fact, you might want to perform a quick scan of your business while you’re thinking about it.  (I did, and I can tell you I have some work to do!)  Do you have good goals, plans, procedures, measures, and people?  How would you score them for your business on a 1 to 10 scale?  How would others in your company score them?  If you determine that your company is lacking in one or more areas and you are motivated to take action, just remember that we don’t have to do everything at once -- it’s a way of life, not an event. 

I’m convinced that by continually addressing each element of this universal framework, over the long term we’ll enjoy increasing revenues, healthy profits, strong employee morale, and the highest levels of customer satisfaction.  That should make it worth doing.  Oh, and of course we’ll have a lot more fun running the business.  And that’s probably the best part.

Please let me know your thoughts … by clicking here.

- Brian

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