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Turning Strategy Into Results Dr. Bill Casey Wendi Peck Executive Leadership Group, Inc.

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1 Turning Strategy Into Results Dr. Bill Casey Wendi Peck Executive Leadership Group, Inc.

2 Danny Gilbert Self-made billionaire “We have a saying in our companies that ‘innovation is rewarded, but execution is worshipped.’ A great idea is just the first step. The real talent is bringing that idea to life with great execution.” Admiral Mike Mullen CNO “It is time to execute.”

3 THINK of a strategy Execute the strategy A Think-Do Chasm Exists

4 Fortunately, you don’t have to re-invent anything; there is a time-tested approach Private & Military entities who have benefited from this approach: Sybase Molson-Coors SPL Worldgroup Seagate Citicorp Qwest Great West Life US Coast Guard US Navy: SUBFOR Navy Medicine NETWARCOM Deep Blue SPAWAR

5 Adopt this 3-part formula to cut through the Fog of Turning Strategy into Results... and give leaders a way to steer their organizations

6 Course Objectives : You’ll be able to 1.Translate strategy into measurable effects/results 2.Express effects-sans-side effects as Whole Goals 3.Create an effects-based strategy with Force Field Analysis 4.Use Whole Goals to execute strategy, using them as a a basis for: Focus Alignment Accountability In short, you should leave with the basic know-how to develop and execute a strategy that is scalable to almost any size organization or initiative.

7 Principles and Methods We’ll explore this formula for success in two ways: 1. Principles (for thinking) 2. Methods (for doing) However, there will be about 60 – 90 minutes of ground school before we get to take flight.

8 Use three elements to turn strategy into results Let’s start with some important principles on creating FOCUS...

9 Effect

10 A results-focus helps us avoid the activity trap

11 "Great leaders never tell people how to do their jobs. Great leaders tell people what to do and establish a framework within which it must be done. Then they let people on the front lines, who know best, figure out how to get it done." ~ General H. Norman Schwarzkopf A results-focus promotes innovation

12 What’s really, really the point?  FIRST ask:  ONLY THEN ask: How will I know when I succeed? What happens if you ask the second (metrics) question FIRST?

13 When you lead an initiative or execute a strategy, it’s good to know what “good” looks like... GOOD FASTCHEAP Those first two questions help you figure this out  

14 “Good” comes in 4 flavors Successful Efforts Successful Results Disputable Success Indisputable Success

15 We’ll focus on indisputable results Successful Results Indisputable Success Our focus Because the “indisputable result” is a smart way to write effects And I ABSOLUTELY GUARANTEE it will make YOU strategically smarter

16 “Indisputable” means we can ALL agree on whether or not success has occurred, which is why we measure. “Who are you gonna believe: me, or your own eyes?” How will we know we’ve achieved objectives such as “Win the War on terrorism” or, “Achieve transformation”?

17 If There’s Room For Interpretation... Execution will: Take longer than it should, Cost more than it should, and Produce unpredictable, and often undesired results Oh, and frustrate a lot of people in the process! I THINK I know what they mean. Sort of.

18 Are These Indisputable? 1. Defeat violent extremism as a threat to our way of life as a free and open society, 2. Create a global environment inhospitable to violent extremists and all who support them From the National Military Strategic Plan for the War on Terrorism

19 Decrease Lost Underway Days by at least 25%. Metric Target Communicating Indisputable Results Means combining the Metric and the Target

20 It is easier to focus on indisputable results when they are stated simply In our personal lives, we would never think this way: “Dollars/year”“Make a good living” Outcome:Metric:Target: “100,000” Instead, we’d simply say: “Make a $100,000 per year.”

21 Imagine that you’re betting on your own success. Twenty bucks says you’ll fail. You already know how to answer the question: How will we know?

22 Summary: Key Principles Focus on Results (aka Effects) – Not Activities First ask: What’s The Point? Then ask: How will I know I’ve succeeded? The answer to the second question must be answered in indisputable language to avoid misinterpretation Indisputable results must include both the metric and the target to be achieved Indisputable results must be defined UP FRONT Indisputable results are the foundation for achieving the focus, alignment and accountability required for successful execution

23 Now Let’s Explore One Method For Applying These Principles

24 Whole Goals are an exquisite method for depicting indisputable results.

25 Whole Goals are the “hub” of this success formula

26 Whole Goals are exceptionally robust because of their two parts ½ ½

27 The first half states the result you want Here’s what I want to achieve. ½ “Result”

28 And, here’s what I really don’t want along the way. ½ The second half bans the side- effects you don’t want “Restrictions”

29 Prescribe results; proscribe side-effects ½ Here’s the indisputable result I want... ½ Result Restrictions... but without these side- effects! Bind these commitments together into a single, Whole Goal

30 Some indisputable results Increase the skill fit between all billets and all employees (civilian and military) to at least 90%. Ensure that at least 60% of the fleet is C1 or C2. Decrease customer wait time by 40% for high priority (c3/c4) CASREP parts. 100% theater ASW Commanders agree or strongly agree that, “The IUSS community provides information that is accurate, actionable, and timely.” [quarterly, 5-second survey] Increase the breadth and depth of commanders’ use of IO as reflected in incorporation of IO in deliberate & crisis action planning, exercises, and current operations as indicated by achieving > X on our IO maturity model. [“maturity model,” “behaviorally anchored rating scale,” some “measures of effectiveness”]

31 What’s the right strategic level? Increase company share price by > X% Increase the company’s profit > X% Increase the company’s revenue > X% Increase sales of VAD by > X% Increase add-on sales of VAD by > X% > 90% service reps can answer at least 19 out of 20 questions on VAD > 90% of service reps sent to VAD sales training

32 Conquer the Dark Side 2nd Half of a Whole Goal: Q: How do we achieve The Point, while protecting what’s precious? A: We use restrictions.

33 Restrictions state the co-LATERAL damage you won’t allow Restrictions Stay within them Indisputable Result Cross the finish line, then (typically) keep going The Finish Line Result + Restrictions = Whole Goal

34 Non-violence wasn’t his dream. It was the restriction he placed on achieving his dream. Use restrictions to protect what’s precious while pursuing your goals

35 Restrictions can help promote collaborative behaviors Or... at least they can muzzle a lot of uncollaborative behaviors

36 The difference between results and restrictions “Drive Warfighter Medical Readiness” Owner: VADM Arthur, Navy Surgeon General Indisputable Result Restrictions At least 90% of all Sailors & Marines are Operationally Medically Ready. At least 75% of all Sailors and Marines are Class 1

37 Here’s a before & after example (From the Navy’s Network Warfare Command) Workforce example Starting point: “Develop a cadre of cyber-warriors.” Indisputable result Sustain, retain, attract, and develop a qualified/certified, diverse workforce to meet mission requirements as measured by ratings from recipient organizations, achieving ratings of “meet requirements” or “exceed requirements” for personnel within the information domain. Restrictions Cannot receive ratings of “fails to meet requirements” from any customer. Ensure billets are coded/characterized correctly to meet actual requirements. Ending point:

38 Restrictions help manage some risks You will have risks of collateral damage and risks of failure. Restrictions help you manage the first kind.

39 Restrictions vs. Constraints: Same thing? Restrictions Constraints

40 Use these criteria for restrictions Measurable and verifiable (yeah, you’ve got to track restrictions, too) Not objectives-in-disguise Keep your list of restrictions short

41 Simple Whole Goals add a beautiful simplicity to clarifying and communicating direction because they combine the ideas of desired effects, objectives, measures of effectiveness, and collateral damage.

42 Summary: Effective Goals The mechanism for applying the success principles Goals should reflect the appropriate strategic level for the role trying to achieve them Indisputable Results (expressed as measurable goals) are the centerpiece for achieving successful strategy or initiative execution Goals should prescribe indisputable results while proscribing collateral damage. We like Whole Goals because they: –Articulate indisputable results/effects –Include critical restrictions that help prevent unintended negative consequences –Simplify communication and create greater focus by integrating desired effects, objectives, and MOE’s into one place

43 Exercise: Make It a Whole Goal

44 Alignment Use Whole Goals to help achieve

45 So What Are We Trying to Align Anyway? Personality types? Philosophies? Intentions? Motivation? The stars?

46 What We MUST Align: Strategies to ultimate desired effects/results Individual performance to these strategies Interdependent roles to each other Performance consequences (such as pay) to the achievement of desired results (more to come on accountability later) Good News: Whole Goals will help you with all of these

47 Strategy is your theory about how to step from the present to a specific, desired future Start by aligning strategy to results

48 Strategies Must Be Clear, Too Unfortunately, most strategies get expressed as “fuzzy” concepts that can also be interpreted in many ways. “We will lead with innovation!” “We will adopt a fast-follower strategy.” “We will shed non-essential activities and stick to our knitting.”

49 Solution: State strategies as subordinate, indisputable results that prove you have successfully implemented your strategy Reduce by at least 80% the cycle time for response to requests for ADJET briefs Reduce flag officer chops to no more than 1 Standardize all inputs on XML Reach agreement with customers to consolidate ADJET & ADTIR briefs “We need to reduce flag involvement, and do better at standardizing and consolidating.”

50 Goals to the rescue! Use Whole Goals To clearly express strategy as Results in cause and effect fashion

51 This is a Results Map It’s like “strategy mapping” on steroids purpose, vision, values WBS, tasks, timeframes, resources, etc. (actions)

52 This provides a common definition of success, and of successful contribution The people down here have a deep understanding of the strategy – and where they fit in! Single, over-arching “metric”

53 Notice that strategic thinking occurs at every level of the organization purpose, vision, values

54 There are many ways to pry loose good theories (strategies) SWOT Analysis Listen to your people Force Field Analysis Talk with your customers Be brilliant and insightful Shamelessly steal ideas Benchmarkin g Just brainstorm with smart people Gap Analysis Force Field Analysis

55 Force Field Analysis is Brilliantly Basic Kurt Lewin The schtuck point Ve get schtuck betveen equal, opposing forces.

56 Force Field Analysis Disequilibrium yields movement My Current Weight My Desired Weight EnablersBarriers Goal: 20# Less

57 FFA Pumped UP 1.First, decide on categories of enablers & barriers –E.g., suppliers, customers, funding, internal resistance 2.Then do a FFA for each category. Do this to net more than twice as many useable ideas as ordinary FFA: Examples of categories: People, Money, Communications, IT/IM, Diversity, Change Management, Risks, Stakeholder Interests

58 Here are some FFA tips Barriers & Enablers are not: Pro’s & con’s Absence of a pre-conceived solution Fuzzy abstractions If you don’t know whether something is an enabler or a barrier (e.g., budget), don’t worry. Just put it somewhere.

59 Part One: Do a force field analysis on your Whole Goal You will receive instructions for Part Two in approximately 30 minutes. Two-Part Exercise

60 Pull forth strategies from FFA (The second part of your exercise) 1.Identify where you are now & where you want to be. 2.Brainstorm the forces –Enablers & Barriers (AKA Drivers & Constraints) –Weight them (1 – 5) 3.Circle what you can change or influence 4.For the items you circled, decide the implications for strategy: –Generate COAs that would strengthen or add enablers... weaken or eliminate barriers Status Quo Desired Result EnablersBarriers

61 Your strategy(ies) must address the risk of failure You will have risks of collateral damage and risks of failure. Your judgment of what’s “necessary & sufficient” are how you manage the second kind. Bonus: good judgment here drives efficiency, too.

62 Tight alignment asks the “necessary & sufficient” questions Is each of these really necessary to cause the result? Tier 1 Result Tier 2 Results Taken together, are they sufficient to cause the result?

63 Traditional “alignment” asks a less rigorous question “Can I claim that what I am doing somehow contributes to the boss’ goals?” I’m sure aligned! Me too!

64 Tight alignment enables strategic “goal alignment” Versus Potluck Alignment Hey, everybody, bring something to the party that supports my goals! Okay, folks, to accomplish our top goal, there are exactly four results we’ll have to achieve. Question: which do we mean by “common metrics”? In Other Words...

65 Tight alignment requires that you cascade goals one tier at a time This is also how you ARTICULATE and TRANSLATE strategy at every level

66 The organization’s strategy drive subordinate strategies Enablers support your effects Initiatives Organizational Design Strategy for Our People Lean Six Sigma I.T. Strategy Policies

67 Summary: The Alignment Logic If desired effects and strategies are expressed as measurable Whole Goals, If these goals represent the necessary and sufficient achievements for success, and If these goals will effectively be used to drive individual performance (yes, we’re about to discuss accountability)... Then: The very FIRST thing we need to align is: GOALS

68 Decrease customer wait time for high failure parts > 40% -No increase in shipping costs -No increase in personnel -No increase in stock on ships Vendor agreements will reflect provision of high priority parts within 24 hours -No increase in parts cost Redesign of high failure/high cost parts will achieve > 50% MTBF -Investment breakeven in no more than 36 months. Reduce internal sourcing process > 20% -No more than 5% increase in customer wait time for non- priority parts. Decrease logistics pipeline for overseas forces > 30% -No impact on CONUS logistics pipeline Can you begin to imagine a results map that articulates subordinate Whole Goals that reflect your strategies and align to your top-level Whole Goal?

69 Accountability Use Whole Goals to help achieve Again, let’s start with some key principles......

70 Bottom Line: People must be held accountable for producing the results (Whole Goals) to which they committed

71 Accountability is not about bullying people (This is not the sense in which we are using the word “execution”) However,

72 The Three C’s of Accountability Commitment from the direct report Consequences for performance Clear Goal Assignment from the manager Mostly positive work best

73 Some leaders use Whole Goals & FitReps

74 Accountability is for individuals (not groups) Each Whole Goal belongs to an actual, real person. This means each person has an excruciatingly clear role.

75 Whole Goals stay with the position, even when the person has moved on. This promotes the role clarity that results in Predictable organizational performance despite personnel churn. Accountabilities stay with the role With Whole Goals, it doesn’t matter who’s in the picture

76 Summary: Accountability Concepts Accountability only exists if there is (1) a clear assignment (2) commitment (3) consequences (preferably positive) for performance. Accountabilities are best expressed as Whole Goals that are tightly aligned vertically and horizontally Whole Goals stay with the role in order to drive predictable organizational performance over time (despite frequent churn) Authorities of the role must be commensurate with the accountabilities (Whole Goals) of the role

77 Bringing it All Together Let’s look at a process that applies the principles we’ve discussed and turns strategies into results

78 Strategic Planning & Execution Current-State Assessment Validate Vision and Mission Tier 1 Tier 2 Tier 3 strategy Establish Tier 1 Whole Goals Drive your strategies deeper with lower tier Whole Goals that: Articulate and operationalize strategy Align vertically and horizontally Enable accountability for strategy execution Assess Landscape Validate Vision, Purpose Identify strategies for closing the gap between current state and desired ultimate success Employ an ongoing governance process to ensure accountability for goal achievement

79 A Few Tips For Making The Process Work...

80 First, you gotta talk with people Baseline (assess) your current performance. Figure out what you need, what customers need, what you can or can’t count on from suppliers, how you fit into your boss’ success, and the point of your command, organization or initiative.

81 Then, float your draft Whole Goals with your leadership team Hey, team, whatdya think of my great, new Whole Goals? Uh, boss. I do have an idea or two. So, THAT’s what he’s been trying to tell us!

82 Don’t forget to... Validate and align your Whole Goals with interdependent organizations (i.e. customers, suppliers)

83 Cascade Whole Goals one tier at a time This is how you ARTICULATE and TRANSLATE strategy Then:

84 Resolve WHO is on the hook for each goal It makes perfect sense that my role “owns” this goal! Make sure the role assigned to achieve the goal has the appropriate authorities

85 Boss Subord 1Subord 2Subord 3 Et Cetera. Look for: Gaps Overlaps Conflicts Danglers Use team discussions to achieve goal alignment and give the boss better strategic control

86 Much is UN-delegatable Sponsorship of the process cannot be delegated, but day-to-day management of it can Strategic thinking cannot be delegated, but data- gathering can Expressing strategy as a measurable result cannot be delegated, but building tracking mechanisms and using them can

87 Do not confuse these roles They are really quite different Make the gauge Move the gaugeRead the gauge Our discussion has been focused on accountability for MOVING the gauge

88 Once a boss and team have their Whole Goals, it’s time for governance Keep people focused and motivated Ensure agility (Keep the plan updated and relevant) Promote risk identification and collaborative solutions Regular Whole Goal reviews

89 The governance process is your organization’s adaptive conscience (Just kidding about the ruler. Effective governance is rarely punitive.) and it must never, never shut up

90 Adjust your governance cycle to the speed of your organization

91 Use these 3 elements for strategic control In Summary Apply the principles and methods we’ve discussed and drive your organizations and projects to the desired destination

92 Supplemental Material Pretty Good

93 Educate Whole Goals, Strategy Dev. & Execution 4 Align Externally Discuss & confirm Whole Goals with external organizations Include customers & suppliers For the senior leader of the organization These are baseline (revisable) Whole Goals 5 Accountability to Sustain Alignment & Focus Every 30 – 45 days: Phase I: Senior Team Alignment Review Whole Goals to sustain alignment Modify Whole Goals only as new information becomes available – and strategy needs to change Again, review sequence is based on leader’s Whole Goals, not based on routine department head readouts Tiers 1 & 2: Senior Leader & Direct Reports Direct & Involve Explain leader’s (i.e. the org’s) Whole Goals Solicit feedback & questions 2 Alignment Session #1 (for sr. leader and direct reports) Challenge Homework: “Develop your own Whole Goals.” 1 Develop Senior Leader Whole Goals 3 Alignment Session #2 (for senior leader and direct reports) Each direct report “proposes” his/her Whole Goals to the group Discussion & debate encouraged Presentation sequence based on leader’s Whole Goals Results: Vertical alignment of Whole Goals to Tier 1 Horizontal alignment to each other Alignment Process Build linkages between performance on Whole Goals (achievement of desired results) and meaningful performance consequences Develop/Refine Strategies to Achieve Whole Goals

94 1 Tier 3 Education 4 Cascade Whole Goals (optional) Align Tier 4, 5 etc. Sustain alignment & focus 2 Tier 3 Alignment Alignment session for each Tier 2 manager and team Inter-team gallery walks to ensure horizontal alignment Phase II: Aligning Tier 3 & Below Alignment Process Strategy articulation: Whole Goals & alignment Execution: accountability & authority 3 Accountability to Sustain Alignment & Focus Every 30 – 45 days review Whole Goals to sustain alignment (procedures as described previously for Tier 2 Whole Goal Reviews)

95 CONOPS: Strategy creation & deployment for the effects-based enterprise These are tough questions asked and answered recursively down the organization What’s the point?  Why do we exist?  What are we trying to be in the world that’s going to be? How will we measure results? The results that really matter (desired results) are sometimes the most difficult to measure. How will we achieve accountability? How will we regularly review and consequate results achievement? What results are necessary & sufficient? What unintended consequences must we explicitly proscribe? What results/results will achieve the point? Who’s on the hook? For each result, what INDIVIDUAL will be held accountable? Does that INDIVIDUAL have the resources, information and authority to really deliver on the commitment? And then... What results will achieve those results?

96 “Metrics” Comments worth sharing (1) Are you measuring because you have threshold/objective MOEs...or is the measuring just to find out what you are doing over time? (2) What assumptions were the basis for each metric as a useful MOE? In other words, do you know how meaningful the measure is? (3) Do management meetings address how the leadership enables or constrains efforts to achieve the useful MOEs? In other words, is there a feedback loop making senior management responsive to lower tiers (that actually do...or don't do...the work)? (4) If the metrics are going in a good direction, what do you do? Reward? Cut efforts as they exceed threshold or as payoff on the way to objective does not balance against other needs? In short, how does management react to its own metrics? Same is true for metrics headed south. It is interesting to see that, when an MOE heads south, and an enterprise actually set conditions for that to happen, senior leaders often blithely just change and lower the output metric. We also are very good at not changing goals and MOEs, even if the leadership cannot enable them, they then become enterprise cultural totems, not real performance metrics.. “My experience with metrics leads to a couple of questions for the enterprise leaders who choose them:” Informal communication from Gen. Robert Magnus Assistant Commandant of the Marine Corps 2 APR 2006

97 Example of a results map Decrease customer wait time for high failure parts > 40% -No increase in shipping costs -No increase in personnel -No increase in stock on ships Vendor agreements will reflect provision of high priority parts within 24 hours -No increase in parts cost Redesign of high failure/high cost parts will achieve > 50% MTBF -Investment breakeven in no more than 36 months. Reduce internal sourcing process > 20% -No more than 5% increase in customer wait time for non- priority parts. Decrease logistics pipeline for overseas forces > 30% -No impact on CONUS logistics pipeline (cont)

98 Example continued Decrease logistics pipeline for overseas forces > 30% -No impact to CONUS logistics pipeline Decrease handoffs > 50% -No use of uncertified agents Decrease transit time > 20% -No more than 10% increase in costs -No increase in lost shipments Decrease time at customs > 25% -No additional personnel -No newsworthy incidents

99 A simple maturity model (A concept that is sometimes useful in measuring complex things)

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