Control
In terms of the strategy implementation process, the “Control” phase is fifth out of five phases. It refers to defining: How, When and Who, and will review the implementation of the strategy. It is our plan for how we will hold ourselves to account and where our KPI’s come alive. A lack of accountability is one of the key reasons plans do not get implemented and the biggest source of frustration for the business leader.
Defining specifically, in detail, how implementation of your plan will be controlled demonstrates the commitment needed to see strategy fully implemented.
Ongoing Implementation Reviews / Meetings
Putting this ‘Control’ into action is about monitoring KPI’s to understand the business performance and the financial outcomes that result.
Most important is being clear about the expectation of action following these review meetings. If we are behind on a KPI, what happens next? We all ignore it and move on? Not so good in seeing a plan fully implemented.
Alternatively, the person responsible for that area is positively challenged and supported to understand why and what actions are in place to get us back on track. If they do not know, it is then put as the first agenda item for the next meeting where they will present their findings and plans? Much more likely to result in a plan being implemented.
Only sustained, objective challenge on results will ensure the full delivery of the plan. These sessions must continue to improve your team’s accountability, remove barriers, and focus on getting things done.
The discipline within these meetings will reflect the discipline with which your senior team approach their targets. Make time. Prepare and set the right approach. These meetings are one of your most powerful tools in ensuring your plan gains traction. Never settle.
The responsibility for setting the dates, getting agendas out, circulating actions etc should again be clearly defined. There should be no circumstances where these meetings or reviews do not happen as scheduled. Make it clear that if you, as the leader or owner, or anyone else, are not available then these meetings must still go ahead. And action should result as normal.
Being clear about the data and reports that will be reviewed in these meetings is also important.
The purpose of each review meeting is to understand: “How well, or not, are we doing in implementing our specific strategy and in achieving the goals we set in our plan?
This is a fantastic question to keep asking as we seek to deliver our plan. It is answered by our KPI’s.
KPI’s are a key component of the change from strategy formulation to strategy delivery. A KPI should be linked to specific Goals or Objectives. Essentially it is you committing to measure your progress towards a Goal. As this Goal is linked to a CSF you can have confidence that you are focusing your time and attention on something which is, well, “Critical”.
Reporting your KPI’s, say monthly, regularly highlights the results of your implementation so far. The KPI is the trend line that is formed from each month’s individual result. The trend line indicates your performance relative to your target. It may highlight a lack of results. Which is most likely a result of a lack of action! However, as you build up the trend line every month you also get an early warning!
So, KPI’s when well designed, are moving your focus from ‘Action Planning’ to ‘Action Doing.’ They also drive accountability when you allocate clear ownership to one specific person in your organisation.
Ideally, you should incorporate two different kinds of KPI’s. Leading and Lag indicators to help ensure your Goals are achieved.
Lag KPIs, measure the outcomes of your activity and can only be measured after you’ve finished implementing your action plan. Just like the rear view mirror in your car shows you where you’ve been. The danger here is that this KPI, for example, ‘Sales Income’ does not alert you to a lack of action soon enough for you to do anything about it.
A Lead KPI, measures the level of activity itself. For example, ‘New Prospect Meetings’ is the activity by which you generate new sales income. Just like looking ahead through the windscreen of your car. If a Lead KPI is reporting below the target you have set then you can anticipate that sales income will be down unless you take corrective action. So, ensuring your KPI’s for each critical target in your plan include a balance of Lead and Lag KPI’s is one way to make it harder for yourself, or your team to not implement the plan.
KPI’s in Action
As an example, I want to dive into Sales data, often a “slippery” area to monitor. You can review rows of numbers, year to dates, variances etc.
But a graph showing sales invoiced and forecast on a cumulative basis leaves no place to hide. In seconds you can understand the actual sales performance in the context of the Goal for the year.
Find ways to make the actual performance against your Goals and KPI immediately visible.
In the case above of ‘Company X’, you might be worried about how far behind you are against your 2020 target and frustrated at the lack of sales in the Pipeline. But remember you might also acknowledge the progress on last year and resolve to review your forecasting for 2021?
Whereas in the case below of ‘Company Y’, you might be delighted with the performance in the second half of the year and spend time with the team to focus on a ‘last big’ push towards beating the target for the year? And not forgetting to focus on making a better start to the next sales year.
Either way, both these companies are showing that implementing plans is important to them and that they expect their people to be accountable.
In a review meeting such information can be combined into a “Dash Board”. Which shows the handful of indicators which mean the business is on track. Often the CSF’s. A particularly useful model for this dashboard is the Balanced Scorecard.
You can use a Red, Amber, Green traffic light system to create focus. If any one of these indicators is off track, or Red, then dig in and find out why and put it right. If a KPI is off track but the person accountable feels they have corrective action in place it would be Amber. If they are all Green, on track, then close the meeting and get back to work. What better way to show trust in your team
Financial KPI’s
Financial information is always a feature of the Control phase of implementing a plan. Delivering this data can now be automated via accounting software such as Xero and linked App’s, so that it is continually updated and must be ‘live’ when you launch your new strategy.
Goals and KPI’s “Cascade”.
Using a dashboard framework such as the Balanced Score Card, popularised by Kaplan and Norton, can help us to ensure there is consistency between the business plan and the department level goals and KPI’s. And even on into individuals within those teams.
The “Cascade” forms alignment between the strategy and people’s individual goals and corresponding performance assessment and even pay, bonus’s and other benefits.
The bottom-line is that the goals which people are personally measured against as part of their performance appraisals, are what they pay most attention to. The clearer the alignment to their department plan and the overall company plan, the more likely it is that they will deliver what you were hoping for in the first place.
“Sharpen The Saw” Retreat
Consider an annual review to conduct an objective review of the plan and the organisations progress. This can be linked to your personal performance appraisal process for all staff, but especially your senior team.
The phrase “Sharpen the Saw” was first coined by Stephen Covey, in The Seven Habits of Highly Effective People”. It is the seventh habit and refers to making time to reinvest in yourself to continue to perform at your best.
Combining the focus of an annual strategy review with the concept of personally ‘sharpening our saw’ is a great way to further drive personal accountability for delivery of the plan.
Most commonly the focus is on reviewing and changing the plan. This can be a mistake. I believe it is important first to review our individual and collective implementation of the plan. If this is good, then consider the execution and then the competitive strategy itself.
It is important to consider the results of your implementation of the plan, especially customer feedback, and respond appropriately. However, far more plans are scuppered by too much change, than are damaged by not changing enough. Resist the temptation to make major changes to the plan within the first few years.
Instead focus on implementation. Deepen accountability, clarify performance reporting, and developing the people and culture across the business.
Do these things well and your plan will bridge the gap between action planning and action doing.
Other Articles in our Rescue, Recovery, Reinvent Series:-
Article 1 – Businesses That Plan Do Better
Article 2 – Business Strategy, Why Bother?
Article 3 – The Importance of Purpose, Vision and Values
Article 4 – How to Predict the Unpredictable
Article 5 – Sh!t Happens
Article 6 – Why Competing “To Be The Best” is The Worst Strategy Ever?
Article 7 – Strategy is the Value You Promise To Your Customers
Article 8 – Value Chain – Why So Many Strategies Fail to Deliver
Article 9 – Mind The Gap – The Difference Between Action Planning and Action Doing
Article 10 – Making it Happen….Part one