1 Harnessing the Power of Organizational Alignment:
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Transcript of 1 Harnessing the Power of Organizational Alignment:
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A Seamless Culture of Shared Purpose
The Goal of Strategic The Goal of Strategic AlignmentAlignment
““Alignment is the essence Alignment is the essence of management” of management” Fred Smith, FedEx
“Well aligned companies outperform their competitors on every major financial measure.”
George Labovitz and Harvard Business School
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say organizational disconnects and
silos are the most significant challenge… 2010 PMO 2.0 Trending Report
68%68%
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Contributions to Company Contributions to Company ValuationValuationIntangible assets are Intangible assets are responsible for responsible for 70%70% of value of value
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Ernst and Young, 2009
LeadershipLeadershipCultureCultureInnovationInnovationEngagementEngagementAlignmentAlignment
TangibleTangibleAssetsAssets
IntangibleIntangibleAssetsAssets
Employee engagement Employee engagement a pre-condition and result of correct alignmenta pre-condition and result of correct alignment
Engagement is the outcome of one’s personal
• Satisfaction• Commitment• Pride• Loyalty• Sense of purpose
• Advocacy• Initiative• Persistence• Energy
A 50% spread in observed performance
Companies with high levels of People Engagement improved 19.2%Companies with low levels of People Engagement declined 32.7%
Towers Watson
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Engagement and the Bottom line
Wealth Creation
The EPS growth rate of organizations with engagement scores in the top quartile was 2.6 times greater than organizations with below average scores.
Gallup (survey of 89 organizations)
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Engagement and the Bottom line
Safety
Those with engagement scores in the bottom quartile averaged 62% more accidents.
Gallup
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Engagement and the Bottom line
Productivity
Engaged people are consistently more productive, profitable, safer, healthier, and 87% less likely to leave their employer.
Corporate Leadership Council & Fleming & Apslund
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Engagement and the Bottom line
Engaged teams are not enough. They must also be aligned to the goals of the entire organization.
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But …But …
Aligned teamsAligned teams
Know there’s a planUnderstand the planAgree with the plan Buy into the planEnergize the plan
Looking for Alignment Looking for Alignment - - Key Key QuestionsQuestions
1.1. What is our strategy?What is our strategy?2.2. What do you do?What do you do?3.3. How does what How does what youyou do support the strategy? do support the strategy?
If a majority of employees feel aligned, the company is alignedIf a majority of employees feel aligned, the company is aligned
Common Symptoms of Poor Common Symptoms of Poor AlignmentAlignment
• High turnover• Inability to articulate strategy• Lack of accountability• Information hoarding• Poor teamwork• Little upward information flow• Fragmentation and duplication• Inappropriate or misguided initiative• Excessive focus on short-term results• Team goals trump corporate strategy • Institutional apologists• ‘Vest and Rest’ syndrome
Looking for AlignmentLooking for AlignmentThe key questionsThe key questions
•Is the strategy clear and well-communicated?•Is leadership aligned to deliver unambiguous direction?•Do the processes work efficiently, or are there built-in conflicts?•Do I have a clear understanding of customer needs?•How does alignment impact attrition, retention, profitability and sustainability?
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The Main Thing
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The Main Thing is to keep the Main Thing the Main Thing
Quantitative alignment analytics can helpQuantitative alignment analytics can help
Strategy
Customer
People
Process
•Connecting employee behavior to the mission and strategy•Linking teams and processes to customer needs•Reshaping strategy with real-time customer information•Creating a culture where all four elements work seamlessly
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The Main Thing
TheMainThing
The Axes of AlignmentThe Axes of Alignment
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Process Customer
Strategy
People
Horizontal Alignment
•Eliminating boundaries between company and customer•Understanding, creating, delivering and supporting customer needs•Value creation throughout supply chain•Clearly differentiated and synergistic functional responsibilities
Vertical Alignment
•The rapid and efficient deployment of business strategy throughout the organization•Employee engagement and strategic buy-in through consistent communication•Two-way flow of information through empowered employees•Enabled by measurable and actionable metrics
Challenges of Horizontal Alignment
• Customer requirements change• Customer voice hard to interpret• Customers speak in present tense• Few employees have direct interaction• Understanding the customer is rarely a
collective responsibility
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The Longitude ProblemThe Longitude Problem
Scilly Islands Naval Disaster 1707 Harrison’s Marine Timekeeper 1731Harrison’s Marine Timekeeper 1731
Big 5 Questions on Customer Focus
• What do our customers care about the most• What opportunities do we have to delight• How well are we satisfying them now• What are the “best-of-the-best” competitors
doing• What do we do to make us “difficult to do
business with?”
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Horizontally aligned companies use the Horizontally aligned companies use the voice of their customers as their beaconvoice of their customers as their beacon
The Self-Aligning Company
• Invisible hand of culture• Adjustments made quickly at all levels• Organization senses needs and changes• Distributed leadership• Disciplined enough to continually monitor
the internal and external worlds• Do the right things right and concentrate
on key metrics only
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Overall Alignment Index“The Main Thing”
Category“Critical Success Factors”
Dependent Factor“Key Indicators”
SurveyQuestions
Q1
Q2
Q3
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Powerful Alignment AnalyticsPowerful Alignment AnalyticsSummary WheelSummary Wheel
“The best business tool in America” Andy Greig, Division President, Bechtel Corp
Red – alert (1-55)Yellow – opportunity (56-79)Green – best practice (80-100)
Team 2Team 1 Team 3
Comparative Alignment Dashboard
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Powerful Alignment AnalyticsPowerful Alignment AnalyticsSummary WheelSummary Wheel
Value of Alignment Analysis
•Develops long- and short-term action plans•Pinpoints areas requiring management attention•Launches improvement initiatives•Identifies skill gaps•Isolates best and worst practices•Distributes effective leadership•Aligns people, processes and strategies with market opportunities
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Process Customer
Strategy
People
Management behavior impacts alignment
Vision, change, increasing Vision, change, increasing effectiveness, and driving things effectiveness, and driving things forwardforward
Consistency, efficiency, Consistency, efficiency, implementation, attention to implementation, attention to detail and maintaining qualitydetail and maintaining quality
Responsibility avoidance, Responsibility avoidance, conflict avoidance, or anger and conflict avoidance, or anger and annoyance.annoyance.
AcceleratingAccelerating
SustainingSustaining
BlockingBlocking
Behavior Alignment Instrument from Behavioural Sciences Ltd
Return on Alignment
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The trademarked AlignComm methodology to The trademarked AlignComm methodology to aggregate, evaluate and prioritize remediation aggregate, evaluate and prioritize remediation alternatives to determine which have the alternatives to determine which have the greatest impact on business resultsgreatest impact on business results
AlignComm AlignComm
•Strategic planning support and guidance•Workshops and seminars•Alignment and engagement surveys •Executive coaching•Behavioral Alignment diagnostics for managers•Return on Alignment ® modeling for remediation prioritization•Messaging frameworks and collateral
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