Eric Hiller shares how his experience as a new father reminds him of how one has to adjust and adapt using knowledge learned from lean manufacturing and agile product development.
Coronavirus has changed a lot of things in America—especially in urban areas, where there are heightened precautions. It is even more chaotic when you have your first newborn baby, like my wife and me.
Babies are very different from manufacturing floors; however, there are certain processes that must be repeated over and over. Caring for newborns is a good example of how one has to adjust in a rapidly changing customer demand environment—the “customer” being the baby, of course.
Here are some ways that we can apply what we know from lean manufacturing and agile product development to being new parents.
- Understand the customer’s needs and design your product and process accordingly
Excited relatives and friends are showering you with gifts, but you may be confused about what you actually need. The truth is: Less than you think, but how do you know what? Answer: with good product management. Consider the use cases that your newborn has: he eats, he sleeps, he produces copious dirty diapers, and he needs love and comfort. That’s about it.
A useful technique to understand what you really need is by observing a customer proxy in situ. Before your baby is born, ask to visit a friend’s baby for a few hours (virtually during the quarantine). They will love the company and your help. After research, write a use case for the customer, or make a value-stream map. Document the capital, consumables, and info you need to help the customer accomplish their goals.
Points of connection include:
- Product modularity
- Agile meal planning
- Digital Dashboarding
Read the full article, Bringing up Baby, the Lean and Agile Way, on IndustryWeek.com.
Morten Stilling shares an insightful white paper that explains what the SPOT model is and why it can help you through the initial digital discovery process.
The SPOT Model is a simple but powerful methodology for digitalizing your business with a clear outset in your business strategy. It brings out experienced pains and identified opportunities, and observes common themes found across these.
- Strategic objectives guiding your business
- Pains experienced by your organization
- Opportunities identified by your team
- Themes observed across pains and opportunities
When you apply The SPOT Model to your digital discovery process, you get off to a good start on your Digitalization journey.
All activities in a business should take its outset in business strategy. If your business does not have a well-defined and broadly-communicated strategy, stop reading, go develop one, and tell your employees what it means.
Everyone involved in the digital discovery process must be aware of the context within which the process will be undertaken. Is your business, for example, planning to grow organically or through acquisitions? Are you expecting to expand geographically? Do you have cost-down initiatives in the making? Such strategic plans are important to discuss so all involved have a shared understanding of the industry, company, and market position.
Key points include:
- Opportunities identified
- Themes observed
- After digital discovery: prioritization, delivery and benefit realization
Read the full white paper, The SPOT Model for Digital Discovery, on spot-solutions.dk.
Access this resource from Gaelle Lamotte’s company on how to improve your ability to execute strategies by integrating development and planning, driving focus and alignment.
How often do you win with your strategy?
Strategy development is useful for defining ambitions and long term goals. A good strategy is only as good as the capability to implement it and how well it delivers the desired outcome.
Various research concludes:
Organisations on average realise only 50-63% of the financial performance promised by their strategies.
Others suggest that the figure is in fact less than 30%.
Regardless of the data reviewed, it is not good news!
Failure to execute is often a result of poor understanding, and disjointed planning and governance processes.
Key points include:
- Identification of weak governance processes
- Build in-house capability for aligning Operational Plans and Budget with the Strategy
- The dynamic strategy management approach
Access the full PDF, Improve your ability to execute your strategies, from the Strategy Management Partners’ website.
Duane Capuano shares a white paper on the blocks that stop the implementation of strategies and provides a framework for moving a strategy from thought to action.
Countless association executive teams dedicate significant time and resources to strategic planning. But too often, great ideas and plans stay trapped in the notebook and are quickly moved to the backburner – reduced in priority by more pressing day-to-day management and operational demands.
The need for implementation of forward-looking strategic plans is real and more pressing than ever. Today’s association executives face frustrations of plateaued growth, shrinking revenues and inability to move new ideas into action.
Challenge: Finding New Sources of Revenue
Tightened member budgets have contributed to flat or declining membership and lower attendance at annual meetings, and thus, lower association revenue. Associations must create new products, establish new partnerships, and identify innovative opportunities for engagement to stay relevant. But how…?
Challenge: Growing and Engaging Membership
The professional networking available through social media and new priorities of the Millennial Generation demands that associations find new ways of attracting and engaging members. But how…?
Points covered in this article include:
- Building the business case
- Define priorities
- Establishing metrics
Access the full white paper, From Strategy into Action – A Roadmap to Success for Associations, from successroadsllc.com.
Caroline Taich can help you improve your strategic planning process by understanding what drives the differences in the team’s expectations.
Much of my work involves strategic planning. Over the years I have observed that there are different kinds of strategic plans, and different views on what constitutes an excellent plan. This can lead to trouble when it comes with a mismatch of expectations within one team.
I wonder, why is there so much difference? There is probably a long list of reasons. You could argue that variability occurs because the strategy sector does not provide standards like other professions do. You could argue it’s a resource constraint issue – some have more resources to invest in planning, others have less; this affects the workplan, and thus the results.
In my view, though, one of most important drivers of difference is mindset.
Leaders with a strong appetite for change to have a “Growth mindset.” They find themselves aching for more. Some want to serve their base in a new or different way. Some want to solve for a disruption, like a new competitor or even a new CEO. All want to significantly increase their impact. These leaders value a strategic plan with components that include a deep understanding of their target market, current market trends, lessons from others in and outside of the field. They are looking to make a case for change, and new models to realize it.
Key points covered include:
- The growth mindset
- The operational mindset
Read the full article, How to avoid a critical mistake when setting up your strategic planning process, on the Kirtland Consulting website.
Nora Ghaoui examines the limitations of artificial intelligence as it pertains to building a business strategy.
If company strategies risk sounding the same when written by people, what happens when they get written by AI? In this post I examine an AI-generated strategy statement for what it says about the abilities of AI and creating strategies. Three years ago, I asked if large companies all had the same strategy. Perhaps their strategies all sounded the same because managers picked up the same ideas from MBAs and consultants, or because they hired the same copywriters. Last month, a new source of non-differentiating strategy appeared – strategy written by AI.
The AI in question is GPT-3 from OpenAI, which has been getting a lot of attention lately. Here’s a quick introduction to GPT-3: it is a language prediction model that autocompletes text from the input that you give it, like you see when you use Google search. It’s able to complete many different kinds of text, giving it a wider range of application than other models.
Its power comes from its sheer size. It has been trained on a huge amount of text from the internet, and it has 175 billion parameters in which it stores the patterns in that text. Its response to an input is the text that is statistically most likely to come after it. So the more examples it has, the better it can match the input.
Key points covered include:
- Example of strategy written by AI
- How AI and predictive analytics work
- Critical thinking
Read the full article, Can AI Write a Strategy?, on the Veridia website.
From her company blog, Nora Ghaoui shares a two-part series that examines the strategy statements of large companies and explains why strategy writing often results in generic statements.
By the time a large company has finished its strategic planning cycle, it ends up with strategy statements that could apply to any company. The same phrases show up every time. Why is that? Do great minds think alike, are people running out of ideas, or are market trends forcing them in the same direction? Before we get into the causes, let’s look at the strategies.
A.G. Lafley and Roger L. Martin, in their book Playing to Win, emphasise that strategy is a set of five choices: the company’s winning aspiration, where it will play, how it will win, its capabilities, and its management systems. Their expectation is that a successful company has a unique right to win.
Similarly, Michael Porter’s famous article “What is Strategy?” states: “Competitive strategy is about being different. It means deliberately choosing a different set of activities to deliver a unique mix of value.”
Can we see these principles at work in company strategies today? What do the company strategy statements say? For now, let’s take these as correct representations of the company’s actual strategies.
The subject of strategy statements include:
- Where to play and how to win
- Capabilities and systems
Read the full article, Do large companies have the same strategy?, on the Veridia website.
Sean McCoy shares a blog post from his company website that presents a case for and against spending resources on ‘innovation’.
Innovation is hard. Most companies do not do it well. Long is the list of established market leaders that were The Disruptee instead of The Disrupter. But firms are not to blame. Most innovations fail period, regardless of who is doing the innovation. Innovation is a high-failure sport.
Nevertheless, conventional wisdom holds that large businesses should be more innovative. It’s even a famous imperative: Innovate or Die. But why should a firm that is organized around low-failure productivity embrace high-failure innovation? Why should a large company make innovation when it can buy innovation?
The argument against ‘Make it’
There are many reasons why a large firm making its own innovation might not make sense. Finance departments balk at the lost capital that could have been allocated to a known winner. HR departments can be reluctant to promote high-failure entrepreneurs, knowing how poorly that will be received by those that receive the opposite treatment for a string of failures. Audit, Compliance, Legal, and Quality Assurance departments usually do not take kindly to bug-y minimum viable products, nor to operators who move fast and break stuff.
Innovation at a big firm is equally difficult from the perspective of the innovator. The large number of stakeholders slows down decision-making. Once decisions are made, the work itself takes longer than entrepreneurs would like, because a company’s processes involve many hands, and innovators want speed.
Points covered in this article include:
- Making innovation
- Buying innovation
- Leveraging an ecosystem
Read the full post, Should your innovation strategy leverage an ecosystem?, on the McCoy Consulting Group website.
Luiz Zorzella takes a leap into the arbitrary world of luck to explain how unforeseen forces should be considered when shaping strategies.
8 months ago, I drafted an article explaining why you should do a sensitivity analysis of your strategy to luck.
I was planning to publish it in March of this year, because of St Patrick’s.
That draft started with “Now is the time to be bold.”. I pointed out that the largest Canadian banks were trading at 1.3x their book value – suggesting that investors believed that they were better off if banks kept their money as capital, rather than returning it (US banks were not as uniformly good but were doing just fine).
Then COVID happened and I abandoned my draft and now Canadian banks and the largest US banks are trading close to book value.
That is how Lady Luck works. She is a whimsical diva and she does not take sides.
Points discussed in this article include:
- When times are good
- When times are bad
- Applying luck break scenarios to strategies
Read the full article, SENSITIVITY ANALYSIS: LUCK, on the Amquant website.
Aneta Key shares a short message that shines a light into the importance of leaders spending valuable time on scenario planning, and how following military training can guide business strategies.
It is important for leadership teams to regularly work through scenarios across time horizons.
Strategic decision-making is at the core of leadership and is what Aneta Key facilitates among clients. It is also one of the core areas explored in the GrowthKey leadership development programs.
This question is a sneak peek from an upcoming episode of the Simplicity for Success podcast in which host Peter Eckart and Aneta are talking about Strategic decision-making under risk and uncertainty.
Points discussed include:
- Thinking across multiple timelines
- The fog of war
- The death of the best plans
Read the article,The Value of Strategic Planning: Military Analogy, and watch the video on the Aedea Partners’ website.
Andrew Hone’s company blog explains why cost reduction programs often fail.
Although cost reduction programs can deliver a powerful mix of financial, strategic, and organisational benefits, the failure rates of these types of programs are very high. A recent survey of C-Suite executives, for example, found that while 90% of businesses had attempted to implement a cost reduction program, 75% failed to meet their targets, and 44% missed them by more than half.
Drawing on some of the key insights from our new report, the Agile Cost Advantage, in this article we consider some of the main reasons why cost reduction programs are so difficult to get right.
The reasons for cost reduction program failure can be complex, and of course depend of the specific circumstances of each cost reduction program. In general though, we see a number of recurring themes behind these causes of failure.
Points covered in this article include:
- Unrealistic targets
- Cost cuts
- Execution challenges
- Loss of momentum
Read the full article, Why do cost reduction programs fail so often? on the Zenith Strategy Associates website.
Luiz Zorzella shares key points that can help leaders evaluate and address their approach to change to ensure better outcomes.
Strategy & Value
For the past 10 years, financial services firms have publicly acknowledged that they needed to change. Chances are, your organization was one of those.
Commoditization meant a systematic erosion of margins for banks; reduction in interest rates has been challenging both interest and non-interest income sources of banks and investment firms as well as the economics of insurance; and technology has posed a constant threat of disintermediation and radical value-adding substitutes.
However, just like the proverbial frog in the heating water, most business leaders have responded incrementally – aiming at matching the pace of change they observed in the market and improving their results within the parameters of their existing business model.
The problem is that change has arrived and it does not look like we expected. While COVID-19 ravages lives, economies and markets, clients and stakeholders alike are looking at financial service firms and asking that they help them weather the storm. They are calling you to change with them.
Points covered in this article include:
- Find you calling
- Evolve and decommodotize
- Reforge your ways of working
- Take the technology plunge
Read the full article, Is this Crisis Your Strategy Crucible, on the Amquant website.
Gaelle Lamotte was recently interviewed for the Telegraph’s Business Reporter on bridging the gap between business strategy and achieving the best results.
Strategies often fail because there is a lack of a robust, compelling strategic story that hangs off them, there’s a failure of coordination between units and functions, often misalignment, and at the end of the day, there’s a lack of leadership agreement around a common shared purpose, around a common agenda. So as a result, you’ll find there’s a real gap in interpretation between a strategic plan and then ultimately what we get at the end, which is numbers and results.
Points discussed include:
- Goal alignment
- Snapshots of performance
- Reaction to results
- Discipline in execution
Listen to the full interview on Business Reporter, the Human Capital Series.
Geoff Wilson gets straight to the point with some tough love in this article by asking if you to make sure your strategy inspires.
The possibilities are endless. Some might say that the sole purpose is to ‘enhance shareholder value.’ I’d argue that this old trope is no longer the gold standard. Some adhere to the stakeholder model…which might be closer. Regardless of the ‘concept,’ a given business strategy has to appeal to a lot of people.
Strategy, inasmuch as it deals with things that are less certain and immediate, is an argument. It’s an argument formed from assumptions that are (or should be) formed from knowable facts and less knowable (but educated) estimates.
But, something tends to happen on the way to building business strategies that derails one of the most important imperatives. We lose the power of inspiration. Usually, we lose it when the hardcore management nerds get ahold of the strategic planning and implementation ‘ecosystem’ and start over whelming the organization with jargon, tools, and really smart pablum.
Read the full article, Are your people uninspired? Maybe it’s time to hang the DJ., on the Wilson Growth Partners website.