Positioning an organization successfully for the future comes down to three solutions.
First, one needs to remember Packard’s Law. Recognizing that big does not equal great, Packard’s Law states that “no company can consistently grow revenues faster than its ability to get enough of the right people to implement that growth with excellence.” I first found this in Jim Collins’ book, How The Mighty Fall and Why Some Companies Never Give In, HarperCollins, 2009.
What we as leaders need to recognize is that we need different networks of people to be successful with different kinds of work. Herminia Ibarra in her book, Act Like A Leader, Think Like A Leader, Harvard Business Review Press, 2015, recommends we build three kinds of networks for different kinds of perspectives. The first is an operational network which helps us manage our current internal responsibilities. The second is a personal network which boosts our personal development. The last is a strategic network which focuses on new business directions and the stakeholders you must get on board to pursue these directions. As she explains, “… your strategic network is made up of relationships that help you to envision the future, sell your ideas, and get the information and resources you need to exploit these ideas…. A good strategic network gives you connective advantage: the ability to marshal information, support, or other resources from one of your networks to obtain results in another.”
With the right people in place and leaders with the right networks, I am reminded of the research by Nitin Nohria, William Joyce and Bruce Robertson in their July 2003 Harvard Business Review article called “What Really Works”. This group published a five year study that they called “The Evergreen Project”, which “examined more than 200 well-established management practices as they were employed over a ten-year period by 160 companies.” This research enabled the authors to distill which management practices truly produced superior results. Their conclusion is that without exception, companies that outperformed their industry peers excelled at four primary management practices:
- strategy: devise and maintain a clearly stated, focused strategy.
- execution: develop and maintain flawless operation execution.
- culture: develop and maintain a performance-oriented culture.
- structure: build and maintain a fast, flexible, flat organization.
The Evergreen Project concluded that these companies also embraced two of four secondary practices: talent development, innovation, leadership, and mergers and acquisitions.
The second solution is to create clarity around the five most important questions. First captured by Peter Drucker, they are the following:
- What is our mission?
- Who is our customer?
- What does the customer value?
- What are our results?
- What is our plan?
Too many times during the last year, I have encountered leaders and organizations that do not have a clarity when it comes to answering the above questions.
The third solution is to achieve consistent, forward progress. As we all know, consistent forward progress, i.e. growth, makes a profound difference. Typically, the performance markers or KPIs signal this is or is not happening. However, the first step is a commitment to the proposed strategy that will create the consistent progress. In order to check whether or not this is in place, ask your management team if they can successfully answer the following question: What are we committed to achieving during the next 10-15 years whether or not the world is turbulent or not turbulent? Clarity and commitment are interrelated.
This week, remember Packard’s Law, answer the five most important questions and check to see if you have strategic commitment and clarity within your core team.