When Sun Tzu, Peter Drucker, and Andy Grove have coffee
tl;dr: an exploration into the implementation of strategic theory into practice.
Many of us, myself definitely included, like to think that we are “being strategic” in the actions that we take.
There are times, however, when I feel like “strategy” is one of the most over-used, least understood words in business. It was this sense that propelled me to become a student of strategy.
It’s a massive read, going all the way back to the Peloponnesian War, but his explanation of “what is strategy” was the simplest I had found.
Strategy is the alignment of vision with capabilities.– John Lewis Gaddis
There are three operative words there.
Vision, capabilites, alignment.
Vision is the “easy” part. It’s fun. It’s the “pie in the sky” brainstorming. We dream of a desired, better future state.
Capabilities, well, we may love or hate them at a given time for the strengths or the weaknesses they provide us, but with a bit of research, questioning, and experimentation, we can get a sense of what they are.
Alignment….ah, there’s the hard part.
But I’ll say this.
The more that I think about it, the more I suspect that the organizational winners and losers of the next decade will be determined by a few critical factors, most of them having to do with speed of alignment and realignment.
Alignment in Changing Conditions
If alignment happened solely in a vacuum, it would be challenging enough.
I saw a family walking in the park the other day. The youngest child, she was probably 3, was wearing snow boots. It was 24 degrees Celsius. Those parents understand the challenge of alignment, and that’s just in their front hall.
But most challenges of alignment happen within a much larger, ever changing macro context.
As a result, the vision may change (“we need to deal with a post-coronavirus world”) and the capabilities may change (“we can’t rely on having in-person discussions because of social distancing and travel issues”).
Which means that, by definition, the organization is out of alignment.
Furthermore, because of ever changing contexts, the way that we operate may need to change (“speed up production” or “slow down production.”)
Sun Tzu said it more elegantly:
“You must be swift as the wind, dense as the forest, rapacious as fire, steadfast like a mountain, mysterious as night and mighty as thunder.”
p.75 of Trapp version of Art of War
There’s no way that can be done without alignment.
Executives and Alignment
Alignment doesn’t just occur magically out of nowhere.
It’s driven by generals in the military and executives in an organization.
I can’t say this with 100% certainty, but my guess is that all of us have, at one point or another, worked for an ineffective executive.
So, then, what makes for an effective executive who can successfully create and drive alignment, particularly in a “high VUCA” environment?
Conveniently, the greatest management consultant of all time, Peter Drucker, has a book called The Effective Executive: The Definitive Guide to Getting the Right Things Done.
What effective executives do
Drucker lays out 5 things that effective executives do that others do not.
- know where their time goes
- focus on outward contribution
- build on strengths, not on weaknesses
- concentrate on the few major areas where superior performance will produce outstanding results
- make effective decisions
Alone, these aren’t easy.
Try tracking where you actually spend your time on a daily basis. In fact, ask yourself how many of the 5 you do.
I know I did and it’s humbling.
OKRs: Connecting the Alignment Dots
So, we have vision, we have capabilities, and we (hopefully) have effective executives figuring out and deciding if we need to be “swift as wind” or “dense as forests.”
But how do you actually drive the result?
One way that has been gaining attention in the past two decades are OKRs, which stand for Objectives and Key Results.
“The key result has to be measurable. But at the end you can look, and without any arguments: Did I do that or did I not do it? Yes? No? Simple. No judgments in it.”
“OKRs comprise of an objective—a clearly defined goal—and 3-5 key results—specific measures used to track the achievement of that goal.3]
The goal of OKR is to define how to achieve objectives through concrete, specific and measurable actions.
Key results can be measured on a 0-100% scale or any numerical unit (e.g. dollar amount, %, items, etc.).
Objectives should also be supported by initiatives, which are the measurable plans and activities that help to achieve the objective and move forward the key results.“
While Drucker may get credit for being the “grandfather” of OKRs by helping organizations to focus on the “big rocks,” the famed venture capitalist, John Doerr, was the one who crafted the name of the framework and popularized it.
Doerr learned about OKRs from none other than Andy Grove, the father of OKRs, during the latter’s tenure as CEO of Intel in the mid 1970s.
But it wasn’t until 20 years later, when Doerr’s firm invested in a search start-up, Google, that the evidence of the value of OKRs started to get more attention.
As Google co-founder Larry Page said:
“OKRs have helped lead us to 10x growth, many times over. They’ve helped make our crazily bold mission of ‘organizing the world’s information’ perhaps even achievable. They’ve kept me and the rest of the company on time and on track when it mattered the most.”“
OKRs as a discipline have been gaining steam ever since and, I suspect, their use will accelerate for the billion reasons that coronavirus has dropped on us.
But there’s still one final piece that I think is missing in all of this.
Alignment and Communication
Whether it’s called the “last mile”or the 80-20 rule, the challenging part for any organization larger than a few people is this:
How do you effectively communicate a new strategic direction to everyone so that any period of misalignment is as short as possible?
Most organizations use a combination of spreadsheets, emails, webinars, town halls, videos, and well, you’ve seen them all.
It’s challenging….how do you get everyone on the same page without losing the intent of the message across language and cultural barriers?
Again, Sun Tzu:
“in battle, the human voice is not strong enough to be heard which is why we use gongs and drums; our eyesight is not acute enough, which is why we use banners and flags.
”p.75 of Trapp version of Art of War
Today, gongs, drums, banners, and flags are nice, but not sufficient.
The 6 Barometers of Strategic Readiness
I think the world of organizational “haves” and “have nots” will be determined by a few factors, most of which come down to speed.
- how quickly can an organization recognize the need to change?
- how quickly can a new OKR plan (“steadfast as mountain”) be formulated?
- how rapidly can the new OKR plan get communicated to the rest of the entity?
- how rapidly can it assess the total alignment (call it an “Organizational Alignment Index”) following the change?
- how quickly can an organization determine if the new alignment is driving the desired results?
And, of course, how effective are the executives in the organization as leaders?
With so many people displaced, so many working from home, and so much volatility, these management disciplines are going to get renewed attention.
Then, we’ll know who is “strategic” and who is flailing.
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