Threading The Needle: Sewing Corporate Strategy Together With Operations

During countless conversations we have with executives, they discuss the biggest strategic planning challenge they face within their environments – that of strategy execution. Aligning corporate strategy to operational execution is indeed critical, yet most organizations fail to continue the planning effort beyond the corporate planning process – into the operational layers of the organization.  By doing a good job in this area, organizations can establish the necessary links from strategic goals to the business-level execution of strategy-supporting initiatives.  Those links and the governance to manage overall progress at a plan-level constitute the “golden thread” required to sew corporate strategy together with operations so that strategies can be implemented successfully. Because operational planning all to often is not done well, or is overlooked altogether – this article describes ways to inject operational planning into the strategic planning process and string the “golden thread” through all of the execution loop-holes.

How do we string the “golden thread”? 

All organizations are in need the golden thread that links strategy to execution initiatives and operational planning is the answer.

Detailed operational planning has to relate corporate strategy with the operations of the enterprise at the initiative level and below that at the project level.  Initiatives must be identified that support plan goals, then the projects within initiatives must then be carved out and planned.  Operational planning drives the creation of budgets, because we deep dive into the initiatives and lower-level projects at a level that includes: timeframes, human capital, technology requirements and in many cases, dependencies on other projects or programs (groups of projects).

Careful attention to detail at this level can help avoid collisions with other projects down the line.  Even then, there may be inter-dependencies between these groupings of initiatives and shortages of resources where overlaps exist. Tactical planning must delineate to the maximum extent possible the timelines, dependency relationships, resource allocations and costs relative to the allocated budgets across operational areas to avoid as many collisions and conflicts as possible.

How do we avoid disconnects in strategy interpretation?

As we have stated in previous articles, strategy is formulated at the top and the CEO is directly accountable for establishing the direction and the process for strategic and operational planning to unfold effectively.  Communication of the plan goals is a very important part of that process and another huge factor in accomplishing the creation of meaningful operational plans. One approach to consider in the overall communications strategy is to translate plan goals into strategy statements that the organization can embrace and enact. The intent is to effectively disseminate the executive vision throughout the organizational ranks so that empowered employees will be energized and capable of helping their organization.  As with the business strategy, the communication of the business goals must be carefully planned and well orchestrated to achieve the intended results. Communications must target the right messages to the right people in the organization at the time that they need to receive the message.

Can we trust our people to execute?

Another major factor in executing operational plans begins with creating organizational structures that empower informed employees with the latitude to make broader line-level decisions.  This recommendation goes hand-in-hand with leadership having already installed the management teams below them with the organizational core competencies that are needed for accomplishing enterprise strategic goals.  If strong management teams are not yet in place, leadership should take great care not to over-empower lower-level managers that are ill-equipped to handle increased responsibilities (decision-making authority).

Stronger line-level managers and employees benefit the entire organization by improving upon the execution within the business operations while being a major part of the many strategic “goal-supporting” initiatives the business relies upon for fueling the future vision.  Empowerment of managers and employees also gets executive management out of the minutia by trusting well-informed and competent staff below them on the organization chart instead of trying to shoulder too much responsibility themselves. This is accomplished with well-constructed strategic plans that concisely relate to the operational budgets controlling the tactics of implementation.

Organizational performance indicators and metrics help provide the ability to control and manage, as they signal the need for evaluation and analysis early when corrections to implementation tactics can be made more easily with fewer cost implications. With proper management controls in place, this approach allows those closest to the action to respond quickly and appropriately when it is needed – always operating within predefined spheres of control and in concert with the strategic goals. The goals are well known and understood by empowered employees, as their direct managers will have effectively communicated these goals to them, accompanied by the expectations for how they can directly contribute – allowing them to embrace the vision and fully participate in the tactical execution.

With empowerment comes accountability, and accountability requires clarity.  Clarity regarding roles and responsibilities relative to plan goals requires people who have sufficient incentive and understanding to execute to that plan. Employees that understand what is being done, the reasons why, when to do what, and how they can contribute become empowered team players.

Tools such as RACI models can aid in mapping out Responsibility, Accountability, Consult and Inform roles relative to the initiatives and underlying projects supporting the plan.

Trust, but verify.

But what if you, the executive manager, do not have full trust in your lower-level managers?   That is where verification of performance is so very important.  Setting up accountability in job descriptions, as well as incremental work related to strategic initiatives, allows for performance verification to take place.  As a side-note, managers and employees should be allowed to have strong input into their own job descriptions (if not write them entirely).  The direct supervisor of course has the final approval over the content, but the employee must fully “own” the job role.  This is true when reaching agreement on deadlines for strategic initiatives.  After fully understanding the role the employee is expected to play in relation to the strategic initiative, he or she should be responsible for submitting their “accountabilities” related to the initiative to their manager for approval.  Once finalized, job descriptions must be updated in coordination with Human Resource departments.  By keeping these job descriptions current, they will support the accountability factor needed to sustain execution standards of excellence over the long haul.

Individual accountability cannot exist without consequences — both positive and negative. Teams and individuals must understand both the organization’s desired outcomes and their specific responsibilities in achieving those outcomes. Furthermore, their role and impact in meeting organizational objectives should be rewarded, while any behavior that impedes the achievement of organization goals should hold an appropriate consequence.  As part of defining accountabilities with the employee during the planning process, consideration should be given to defining missed, met and exceeded criteria that are collaboratively developed with the employee.

Accountability also must be clear in terms of expected timeframes.  For accountability to exist, all who are affected by the plan must understand what is to be accomplished and within what timeframe. After all, it is impossible to hold people accountable for accomplishing a key outcome if there is no basis to measure. Similarly, if an objective that is not bound by time or if the team has unlimited time to complete it, the goal can never be considered to be complete or its progress evaluated.

Realistic expectations of the long-term performance required of those executing the plan must be considered.  Shorter durations of projects allows accomplishment and reward to take place more frequently and adds to the energy and excitement required to fuel the enthusiasm we want the team and individuals to have before taking on the next task.  Tactical planners who strive to define shorter discreet tasks that have clear start and end targets as well as crisp expected outcomes, construct operational plans which focus on goal accomplishment.

Managing the “golden thread”

Perhaps most important element in stringing the golden thread is plan governance.

Organizations that have matured in their planning process have taken governance to another level and have implemented Plan Management Offices.  Plan governance, whether implemented as a formal Plan Management Office or administered through a less formalized committee structure, should be responsible for the functions of selecting, managing and measuring of everything entering or within the plan portfolio.  The plan portfolio is the overall macroscopic view of all programs (related groupings of initiatives) and projects within initiatives that are involved with strategy implementation.

Plan to re-string the “golden thread” consistently on a periodic basis.

As a function of the ongoing management of the plan portfolio, plan governance also involves refreshing the strategic and supporting operational plans to reflect changes as a result of completing plan goals and taking on new ones.  This structure allows for strategic and operational planning to become much more actively managed and based on a shorter time horizons.  Shorter time horizons for plans lead to more focus on execution and results in better outcomes.  As we’ve discussed in previous articles, a rolling 12-month plan that is refreshed quarterly is best suited for achieving optimal results in execution.

There are several reasons why this approach yields better planning outcomes.  Here are a few:

1 . First, is the tendency of shorter plan horizons to have fewer goals per cycle and therefore are more focused on tactical execution.  Rolling 12-month plans allow the organization to be more responsive to change with goal setting, especially in the operational aspect of planning.  Likewise, plans that are refreshed quarterly are easier to manage and keep the organization sharper and focused on achievement due to the shorter cycles to accomplish chunks of work.

2. Second, in our experience, 12-month rolling plans tend to be better at addressing the pressing needs of the business, while maintaining the long-term focus of the CEO and corporate strategy team.  Add refreshed quarterly plans to the mix and you have instilled into the organization a laser-beam focus on results.  Plan governance administered on a quarter-by-quarter basis affords management the opportunity to review the initiatives underway and assess any backlog that exists.  Management can also assess the organization’s capacity to move an item from the backlog into the active plan – furthering progress towards completion of the plan’s goals.

3. Third, 12-month rolling plans tend to be more realistic. This is attributed to the higher quality data driving the process, such as:  capacity to change, historical achievement, resource availability and current environmental constraints. Plan governance manages alignment of plan goals and supporting initiatives through effective oversight at the corporate and operational levels.  Plan Management Offices benefit the organization by having better visualization into all efforts supporting strategic implementation.  Plan Management Offices also position organizations to better manage the interrelationships of all the underlying initiatives, considering dependency relationships and constraints on resources.

4. Lastly, a plan governance model can harvest metrics and status reporting from across the portfolio of all programs and their underlying projects. Metrics are harvested from the tactical layer to provide historical acceleration data to offer continual improvement to the planning cycle.

In the end, strategic plan governance helps organizations filter through the minutia of everyday tasks to focus on accomplishing key outcomes sought by executive leadership.

Do you own golden thread?  Get started!

Hopefully this article provided some new thoughts on aligning your strategic plans with operational execution.  Tightening processes and disciplines around planning undoubtedly improves execution, but it does require know-how, patience and time.  So what are you waiting for?  You own the golden thread.

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