Welcome to an Overview of Strategy Execution Management and the KeyneLink Process. We’ve spent over a decade working with our Partners at KeyneInsight to understand what it takes to build an organization that consistently executes its Strategy year-after-year.
Unfortunately, the odds are stacked against most organizations. We’ve found that:
1. Every organization has an “execution management system” but doesn’t know what it is.
2. People who’ve never had to be accountable for results are scared of the thought.
3. Many individuals value the status quo of being left alone and not challenged.
4. Most businesses would disagree when challenged about their Execution...it’s like challenging whether or not they have “Integrity”.
There are two types of activities found in organizations:
1. Activities that move an organization forward
2. Day-to-Day activities of running the business
Without a system in place, the Day-to-Day activities take priority and consume employee’s time.
Your organization may or may not be ready to improve its Execution and establish Strategy Execution Management as a core competency, but this topic needs to be on your radar. So enjoy the education being shared with you today.
Overview of Strategy Execution Management - Vision without Execution - The Hampton Group - Jan. 2013
1. Presentation By:
2
Tom Willingham
The Hampton Group
KeyneLink Senior
Consultant
Strategy Execution Management
“Vision without Execution is Hallucination”
2. What’s the Biggest Challenge Facing
Organizations Today?
More sales
Better profitability
More effective communication
Increased productivity
Better customer service
Improved cash-flow
2
3. Here’s What We’ve Found!
The biggest challenge facing any
organization is knowing how to plan
and execute while overcoming the
daily surprises!
Execution is the great unaddressed
issue in the business world today!
3
4. Why is Execution Management so
Important?
The Execution Value Gap represents the largest
opportunity cost for most organizations.
EXECUTION VALUE GAP
The lost value between your
STRATEGY strategic plan and the actual
execution of the plan
“64% of business leaders lack
confidence in their organization’s
ability to close the gap between
strategy and execution.”
- OnPoint’s Strategy-Execution Gap Study
EXECUTION
4
6. A Scary Statistic
Only 17% of company strategies get
fully implemented.
83% fail at implementing their
strategic plans successfully.
6
7. The Reasons are Three-Fold
1. Corporate Culture
- Strategy Execution not a core competency
2. Past Habits
- People like comfort of existing routine
3. Not trained
- Lack systems-thinking to pull together strategy,
planning, organizational alignment, execution
management, and measurement
7
8. An Important Question!
“How do I build an organization
that consistently executes its
strategy year-after-year?”
8
9. Our Answer = A Complete Program
A Repeatable Methodology
An Execution System
Organizational Learning
Accountability Coaching
Strategy Execution as a core
competency
9
10. Change Transformation
Execution happens at an individual level.
Change is Hard!
Only 8% of New Year’s Resolutions get
achieved.
In “change or die” situations only 11% of
people make the change.
10
11. Why is Change Hard?
Rider vs. Elephant: Who is in control?
Rider = Elephant =
Rational Emotional
Side Side
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12. Why is Change Hard?
Rational Mind vs. Emotional Mind
1.What looks like resistance is often lack
of clarity.
2.What looks like laziness is often
exhaustion.
3.What looks like a people problem is often
a situation problem.
Switch: How to Change Things When Change is Hard
By Chip and Dan Heath
12
13. Change Transformation Pattern
Successful change follows a pattern.
1. Direct the Rider – Provide clear direction.
2. Motivate the Elephant – Create ample
motivation.
3. Shape the Path – Establish a supportive
environment.
Switch: How to Change Things When Change is Hard
By Chip and Dan Heath
13
14. Change Transformation Requires
Leadership
“Only three things happen naturally in
organizations:
Friction, confusion, and underperformance.
Everything else requires leadership.”
- Peter Drucker
14
15. The Solution is the System
Without a system you’re playing
Russian-roulette with the results!
I’ve chosen to use the KeyneLink
Strategy Execution Management system.
(www.keyneinsight.com)
The more complex the organization the
simpler the solution.
15
16. Our Definition
Strategy Execution Management
is the process of clarifying,
deploying and achieving
organizational initiatives.
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17. Strategy Execution Model
Execution Management
Strategy Strategy
Implementation Development
Bridging the Gap
17
18. Typical Strategic Planning Process
Organizational Defining Futuring
Strategy
Level Management Process
Vision • Mission
Assessing Planning
Core Values • Initiatives
Review meetings
every 6-12 months
Initiatives
18
19. Traditional Performance Management Process
Organizational Defining Futuring
Strategy
Level Management Process
Vision • Mission
Assessing Planning
Core Values • Initiatives
Review meetings
every 6-12 months
Initiatives
Individual Level
Traditional Maintains
Performance
Management/ Growth
Appraisal Process
Focus On Employee Development
Disconnection
between Organization
and Individual Review
meetings every
6-12 months
19
20. Strategy Execution Management Process
Organizational Defining Futuring
Strategy
Level Management Process
Vision • Mission
Assessing Planning
Core Values • Initiatives
Review meetings
every 6-12 months
Initiatives
Individual Level
Execution
Management Process Align Goals &
Tasks
Organizational Initiatives
linked to Individual Goals
Focus On Achievement
Of Key Initiatives Monitor Progress &
Make Adjustments
Progress
Meetings every
1-2 months
Accelerates Score Goals & Rate
Initiative
Growth
20
21. The KeyneLink Process
The KeyneLink Process follows the
pattern of change.
Provides clear direction, ample
motivation and a concise path.
Part process, part software, part
roadmap.
21
22. Pillars of Execution Management
Execution Management requires two
things:
1. Actionable intelligence on initiatives.
2. The management/leadership structure
and processes to manage execution at
an individual level.
22
23. The KeyneLink Process
1. Foundation Data
Mission
Vision
Core Values
Initiatives
Paints a Clear Picture of the Target.
23
24. The KeyneLink Process
2. Performance Agreements
Defines success for Individual
2. Progress Meetings
3. Reports
4. Quarterly Leadership Team
Meetings
24
25. What would it mean to…….
Employees Customers Shareholders
Expansion Plans Your Brand
25
27. Case Study:
Responsibilities vs. Goals
Two type of Activities in organizations
Functional Day-to-Day
Improving organization & moving forward
Primary Job Responsibilities
What are you Accountable for on an ongoing basis?
Goals
Above and beyond normal job and link to Initiatives
27
28. Case Study:
Defining Responsibilities
Sample Customer Service Representative
Originally submitted as:
“Answer and return customer calls”
“Assist in the entry of orders when required”
Better written as:
“Provide an outstanding Customer Experience”
“Ensure timely entry of sales orders”
What are you accountable for?
... not what you do
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29. Case Study: Writing Goals
Originally submitted as:
“Keep Accounts Receivable below 90 days”
“Implement plan to increase Outside Sales”
Better written as:
Not a Goal...actually a Responsibility
“Outside Sales have increased 15% - 22% YOY”
How will you know when you succeeded?
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30. “Vision without Execution is Hallucination!”
For more information about Strategy Execution Management
Powered by
or a KeyneLink demo, contact: Tom Willingham Keyne Insight, Inc.
www.thampton.com ⧫ (562) 673-9950 ⧫ tomw@thampton.com
Hinweis der Redaktion
Welcome to an overview of Strategy Execution and the KeyneLink Process. My name is Tom Willingham and I’m a senior consultant specializing in strategy execution. By the end of this presentation you’ll have learned a little more about strategy execution, the key elements of the KeyneLink process and what it takes to establish execution management as a core competency in organizations. You’ll also have a better understanding of why change transformation is so difficult and the necessary steps you must follow in order for your organization to successfully make a change. The information contained in this presentation is available to you upon request, so please don’t stress over taking great notes. Just sit back, listen, and absorb the education being shared with you today.
If I were to ask you; “What’s the biggest challenge facing organizations today?” What would your answer be? When we ask this question of executives we often hear these answers: We’d like more sales. We’d like better profitability. We have a need for more effective communication throughout our organization. We’d like to have increased productivity from our employees. We need to have higher levels of quality customer service from our people. We’d like better cash-flow. We hear these answers as well as many others.
However, here’s the answer we’ve found: The biggest challenge facing any organization is for them to know how to plan and execute while overcoming the daily surprises that always seem to get in the way of what’s most important. Because an organization that can do this, can overcome any challenge that comes before them. Execution is the great unaddressed issue in the business world today. Its absence is the single biggest obstacle to success. In Jim Collins’ book Good to Great his research team concludes that strategy doesn’t separate the good from the great…Execution does!
Then why is Execution Management so Important? Because the Gap between where organizations wanted to be and where they actually are is huge and represents missed opportunities and loss of Value. What is really disturbing is that 64% of business leaders say their organization lacks the ability to close that gap.
How do you define Execution in your organization? If your answer was “an Execution”, don’t worry, you are not alone.
Here’s a scary statistic: “Only 17% of company strategies get fully implemented. That means 83% fail at implementing their strategic plans.”
The primary reasons for this are three-fold: 1. Corporate Culture – We just don’t have strategy execution management as a core competency in our organizations. 2. Past Habits. As human beings, we like the comfort of the existing routine. We don’t like change. I guess that’s why only 8% of New Year’s Resolutions are actually achieved. 3. And the third reason is most of us have never been trained in the kind of systems-thinking necessary to know how to put together all the key steps… steps such as strategy, planning, organizational alignment, execution management and measurement.
Here’s an important question. In fact this may be the most important question for all senior executives to ask: “How do I build an organization that consistently executes its strategy year-after-year?”
Our answer is it takes a complete program. A program that consists of: A Repeatable Methodology - This is a predictable process that’s a step-by-step approach that aligns employee’s daily activities to the organization’s strategy. An Execution System - This is a process, supported by software, that’s designed to help employees get the right things done and to help management identify execution problems as early as possible. Organizational Learning - This allows all employees to learn from experience and apply lessons quickly to emerging problems. Most people are Task or Activity oriented...when we teach them to develop SMART Goals and make the connection between their Responsibilities and the Organization’s objectives, their engagement and performance improves. ( 5 Whys?) Accountability Coaching - This addresses the human tendency to do what we like to do, rather than what we know we should do. A great example of this is Weight Watchers . Weight Watchers is a 3-billion-dollar-a-year organization that tells overweight people they’re overweight. They tell them to eat healthier, to eat less and to exercise more. They put their clients on a scale, weigh them and then record their weight on a weekly basis. People who are on this program lose weight. But for many of them they eventually begin to think, “Hey, I can do this on my own. It’s not that hard. I don’t need to be spending money on this…I can do it myself.” And they quit Weight Watchers. And guess what – they gain the weight back. The reason they do… it’s the accountability factor. Accountability Coaching addresses the human tendency to do what we like to do, rather than what we know we should do. And finally it takes Strategy Execution Management as a Core Competency - The end result is an organization that knows how to plan and execute while overcoming the “daily surprises!”
For organizations to change, their people have to change. And no matter how you slice it, a change transformation happens at an individual level. It doesn’t happen at a company level, a division level, a department level or even at a team level. That’s because execution only happens at an individual level. And at an individual level, “change is hard.” As mentioned earlier, only 8% of New Year’s Resolutions get achieved. But here’s a more startling statistic. In “change or die” situations, only 11% of people will make the change. Now, I’m not talking about the kind of “life or death” situation where your wife says; “hey, if you don’t start picking up after yourself, I’m going to kill you.” Or where your boss says; “if you don’t start picking up your sales you’re going to get canned. No, I’m talking about the kind of “life or death” situation where your doctor sits you down, looks you in the eye and says; “if you don’t start doing this or stop doing that, you’re going to die.” In those situations, credible medical research shows that only 11% of people will make the change.
Why is change so hard? University of Virginia psychologist Jonathan Haidt uses the analogy of The Rider vs. The Elephant in his book “ The Happiness Hypothesis .” The Rider holds the reins and seems to be the leader, but control is precarious because of his small size. Anytime the six-ton Elephant (our Emotional side) disagrees about which direction to go, the Rider (our Rational side) is going to lose.
Psychologists have discovered that our minds are ruled by these two different systems – the rational mind and the emotional mind – and both compete for control. The rational mind wants that great beach body; however, the emotional mind wants that Oreo cookie. The rational mind wants to change something at work; but the emotional mind loves the comfort of the existing routine. The tension between this “duo” can doom a change effort.” In their book Switch: How to Change Things when Change is Hard, the Heath brothers found these three surprises about change. What looks like resistance is often lack of clarity. If you want people to change you must provide crystal-clear direction. What looks like laziness is often exhaustion. Self-control is an exhaustible resource. Change is hard because people wear themselves out. What looks like a people problem is often a situation problem. You can change people’s behavior by just shaping their path.
The Heaths suggest that to get things done, change will follow a pattern. Direct the Rider – Provide clear direction. Point to the destination and explain where you are going and why it’s worth it. Motivate the Elephant – Connect on an emotional level to keep the Elephant moving forward. Then shrink the change so it doesn’t spook the Elephant. Shape the Path – Establish a supportive environment. Make the process of choosing the right behaviors a little easier and the wrong behaviors a little bit harder.
And...Change Transformation Requires Leadership. Management Guru Peter Drucker said, “Only three things happen naturally in organizations: friction, confusion and underperformance, everything else requires Leadership.” So change is not going to happen on its own. Establishing the direction, motivation and environment for change must be driven by Senior Management.
For a Leadership Team to establish strategy execution management as a core competency you need to have a strategy execution management system that’s designed to help leaders manage execution down to an individual level. As Michael Gerber stated in his book The E-Myth Manager , the system is the solution. And that without a system you’re playing Russian-roulette with the results. Strategy execution management systems are relatively new. They haven’t been around that long. And there aren’t that many of these systems in the marketplace. Most of what is on the market is automated Performance Management Systems and Review Writers. I’ve studied most of them and I’ve specifically chosen to use the KeyneLink system that was created by Wayne and Kelly Nelsen of Keyne Insight. Over a decade ago, I was client # 3 to implement the predecessor to KeyneLink and have seen the transformational effect this Process can have on an organization. I picked KeyneLink for a variety of reasons, but mainly because of its simplicity. Change is hard and if the solution isn’t simplistic, it won’t get implemented and it surely won’t be sustainable. In fact, we’ve found the more complex the organization the simpler the solution needs to be. And aren’t all organizations complex?
Here’s our definition of strategy execution management – It’s the process of clarifying, deploying and achieving organizational initiatives.
The model we use breaks Execution Management into two main phases: strategy development and strategy implementation. Strategy development involves the typical strategic planning process – assessing, which is where we’re starting from now (SWOT analysis, culture surveys, discussions); defining (mission, core values, purpose); futuring (vision and longer term strategic plan), and planning (what are we going to accomplish this year, hopefully down to an individual level) The problem is not in the planning – most organizations have a pretty good idea of what they want to accomplish for the year. The issue is HOW we get it accomplished, and that’s where execution management comes in – bridging the gap between strategy and execution. We pick up where the planning process leaves off. Executing, monitoring, evaluating and rewarding -- all of that is about working towards achieving the initiatives – executing the strategic plan, and that’s where we pick up.
Here’s another way of looking at this. What typically happens in an organization is that the leadership team gets together for the planning process (the assessing, defining, futuring and planning part of the model), and the outcome should be a set of clear initiatives of what we need to get done for this year, and they may or may not reviewed every 6 to 12 months.
Completely separate is a traditional performance management or performance appraisal system that’s owned by HR that might have a couple of goals stuck in there. The problem is that the traditional performance management/performance appraisal process is owned by HR, who’s not responsible for executing the strategic plan. The leadership team is. Because it’s disconnected, you’re forced to focus on employee development, completely separate of the strategic plan or any initiatives associated with it. Employee development is done for the sake of developing employees, not for helping the organization achieve its initiatives. If we’re going to be doing training and development in an organization, we should be doing it because there’s a gap we have that will keep us from achieving the initiatives. It really ought to look like this: [Next slide]
Rather than having a separate PM/PA process that managers and employees don’t like, the outcome of the planning process should be the beginning of the execution management process, with the initiatives as the starting point. We set goals at the individual level in order to achieve the initiatives, and then we track progress and make adjustments consistently – not once or twice a year, like in a performance appraisal process, but once a month, or once every other month Managers and employees should be sitting down and talking about progress – how are we doing? Are we on schedule, ahead of schedule on goals and responsibilities? At the end of the year, then, the goals are scored and the initiatives are rated and all that stuff feeds into next year’s planning process. This is the way it really ought to look, rather than having a separate individual development plan sitting off to the side, everything ought to be focused on the achievement of the initiatives.
Earlier I stated that when change works it tends to follow a pattern. The KeyneLink Process follows this pattern of successful change. It provides clear direction, ample motivation and a concise and consistent path to follow. The KeyneLink system is part process, part software and part roadmap. And it’s been specifically designed to close this huge gap between strategy and execution.
This requires two key components: Actionable intelligence on the initiatives. The management/leadership structure and processes to manage execution at an individual level.
There are 5 Key Elements of the KeyneLink Process. The first one is the: 1. Foundation Data - This is comprised of the Mission, Vision, Core Values and Initiatives for the organization. In the KeyneLink Process these are more than just statements that get displayed on a wall or printed on small cards that employees can put in their wallets. The clarification and articulation of the foundation data is what paints a clear picture of the target for everyone in the organization to aim for. Because you can’t hit a target you can’t see.
2. Performance Agreements - These are agreements between a manager and their direct report. They reflect the employees’ performance commitments, including their Primary Job Responsibilities and their Goals towards the company’s initiatives. The Performance Agreement paints a clear picture of the target for each employee to hit. 3. Progress Meetings - These are regularly scheduled communication meetings between the manager and their direct report and are around the employee’s Performance Agreement. This is the key to successful strategy execution. 4. Reports - All the data that is inputted into the KeyneLink system, by all of the employees, goes into a series of reports. These reports help the leaders manage strategy execution throughout the organization. 5. Quarterly Leadership Team Meetings - The purpose of these meetings is to keep strategy execution at the forefront of the organization’s leadership.
To wrap up, “What would it mean...if all your goals were met or exceeded?”
I hope that this presentation has given you a good idea about strategy execution and the KeyneLink process. We’ve been working on this system for more than a decade and we feel we’ve come up with not only the best process, but also the best model for implementation. The more you learn about KeyneLink’s strategy execution process the more it will come across as just good common sense. But common sense doesn’t mean common practice. That’s why execution is the great unaddressed issue in the business world today. You’ll find very few organizations that have strategy execution as a core competency. That’s what makes this such an incredible opportunity! If you’re a senior executive and you believe strategy execution would be a valuable core competency for your organization, I hope you’ll contact me. Because there’s nothing more critical than successfully executing your company’s strategic plan year-after-year. If you’d like to receive a copy of this PowerPoint Presentation, send me an e-mail. …and I’ll send you a copy. My phone number is (562) 673-9950 and my e-mail address is tomw@thampton.com. Thanks for taking your time to watch and listen. I’ll leave you now with this famous quote from Thomas Edison: “Vision without execution is hallucination!”