Why Most Organizations Failing to Getting Work Done Faster

What is stopping the CEOs, Functional Heads and managers to get work done faster? And why CEO’s are constantly frustrated that people in the various teams are not collaborating but sitting in silos; resulting in the slow movement of work and business outcomes?

It’s all because of the operating system(a.k.a the way work gets done in the company). The company Work Operating System(WOS) is pending for update for a long time. The legacy organization can become more smart, ready for the new era and more dynamic by improving or even overhaul your current Operating System.

Here are the top 5 ways you can re-inventing your Work Operating System(a.k.a the way work gets done in the company):

  1. Give more autonomy to people to define the plans and KPIs they should be chasing. Your job as a team head is to give directions and make people learn how to define the actual “business-impacting” metrics and action plans. And to review the same every week/month. So make sure that teams are “loosely coupled but tightly aligned.”
  2. Adopt Agile principles in the way you execute your annual operating plan and strategic initiatives. Move agile beyond IT function, and implement it in your sales, marketing, HR and operations.
  3. Replace internal emails with tools like Slack or Microsoft Teams. The average employee checks their email 36 times an hour and receives 304 emails a week. Emails are now used by people to showcase how busy they are and lead to more bureaucratic culture.
  4. Set the cadence of business reviews across the company, not just at top level. And run the meetings in the data-driven way by implementing frameworks like OKR.
  5. The average manager spends up to 210 hours preparing for and doing annual appraisals, a process that makes employees spectators in their development. Ditch your annual appraisal process and implement the new-age agile PMS where goals are set every quarter and feedback and coaching session between employee and manager are done more frequently.

How Amazon define Metrics and achieve higher outcomes

Any company where teams are not able to define robust metrics, move very slow on the learning and growth. In most of the companies, the metrics defined and tracked at team levels are not relevant at all.

But there are companies who are able to define the relevant and robust metrics at the team level, and Amazon is one of them. At Amazon, metrics are defined and established before every initiative and objective is taken up. The progress on those metrics are measured on a real-time basis. Every initiative is a genuine scientific experiment focused on whether it will deliver value to the customer or not. As the metrics are tracked and monitored on a real-time basis, the company knows exactly what is happening on a daily basis.

There are many aspects that needed to be addressed to define enable your teams to define proper metrics within every team. The first is to understand the type of metrics:

4 type of metrics

  1. “Feel Good Metrics” – These are defined when enough influential people within the company believe that defining and tracking these metrics will have some benefits. The definition of the metrics are vague. In the worst-case- these metrics are promoting the interest of the specific group within the company.
  2. “Internal Focused Metrics” – There are metrics which are specific, better than “Feel Good Metrics”, and in no-way related to impact on improving customer experience, revenue and profit of the company(means improving something external), but focused on improving something internal.
  3. “External Focused Metrics” – More focused on improving the external things such as NPS, Revenue and Profit. But its impact on supporting the overall growth of the company is still not that relevant.
  4. “The Impactful Metrics” – These are metrics which truly impact your revenue and profits by improving the customer experience or changing the customer behavior in an expected way. They will truly delight the customer- examples such as availability of the item, speed of delivery, absence of returns and complaints, re-purchases of the product and related products.

Amazon tracks the execution on the fourth metrics – “The Impactful Metrics”. But why most of the companies fail to define and measure the “The Impactful Metrics”. The simple reason is defining and measuring the progress of execution on these metrics on a real-time basis is hard. But winning organizations understand this, and in every early in their stage of evolution, set the guidelines to define them.

Here are the 5 steps that Amazon takes to define and measure the progress under the “The Impactful Metrics”

  1. Obsession with customer value and not stakeholder value – This results in defining the right kind of metrics that enhance customer experience and value.
  2. The discipline of not starting execution on any project/initiative, without defining the metric to measure success. Sometimes the leaders and manager spend their days and weekend on what could be the right metrics before they jump onto executing the project/initiative.
  3. Work is done in small teams working in short cycles
  4. Reviews are around the “The Impactful Metrics”
  5. Linking compensation with achievement of “The Impactful Metrics” . Especially the executive compensation at Amazon is aligned with the core value and principle of “Obsession With Customer Value, Not Shareholder Value”.

Based on the read of John Rossman Think Like Amazon

Key Learnings

  1. Create the culture of defining metrics within every team before they take up the execution.
  2. Keep your teams small to achieve speed in your execution.
  3. Measure the progress on your “Impactful Metrics “ on a real-time basis.

Strategy execution is not a rocket science

It’s true, Strategy execution is not rocket science. The problem is that consulting companies who want to own the keyword “strategy”; wants to show this as a big complex thing in this world that they can bill their clients with millions of dollars by putting the army of consultants.

In a nutshell, Strategy its about “where you will earn money from” and “how you will earn it” in present and future. Your strategy largely depends on the stage of your company. As Ried Hoffman puts in, every company goes through the following stages:
1) Family 2) Tribe (3) Village (4) City (5) Nation

When you are family or at the tribe stage, your strategy is to
(a) Validate that your product or service has demand in the market
(b) Generate revenue to survive OR raise the money from bank/VC to survive for the next 12 to 24 months.
(c) Try to find the repeatable sales & operational model for your product/service

When you are at the village stage, your strategy is to
(a) Create a repeatable model to do sales and service your customer
(b) Keep doing it faster and better

And when you are at the later stage of company growth, ie at “City” stage or “Nation” stage, your strategy is not just to generate the cash from existing product/service, its also about creating new products/services adjustment to your existing market OR to creating new products/services that will diversify your business.

But, is there a guarantee that your strategy will help you to become the market leader. No, because it also depends on the market/economic cycle and conditions. But if your execution cycle matches with the market/economic cycle(means your timing is right), your company will be the part of the those few success stories.

To deliver your strategy at any particular stage, you have a model with 4 standard steps:
1) You identify your vision(the big-arrow) for 12 months(when you are at “Family”, “Tribe” or “Village” state) or next 36 months vision(when you are at “City” or “Nation” state)
2) Once you define your vision, you identify the 3 to 5 major company-level goals(also called focus areas or strategic objectives) that will help you to achieve our vision(the big-arrow)
3) The 3rd step is to identify the major project/programs/objectives that will help you to achieve either of our company-level goals. And define metrics & milestones that will help us to achieve those project/programs/objectives.
4) And the 4th and last step is to follow the review cadence(process) to make sure that work gets done on the defined milestones under the defined project/programs/objectives.

In most of the companies today I talk to or work with at qilo, the above stated 4 simple steps are not followed or followed partially. Coming from the software development background, where today software is delivered in Agile fashion; its a surprise for me. If a small to complex piece of software can be delivered nowadays with high predictability; what stops companies from delivering their annual or 3-year strategy in the agile fashion?

I see 3 major reasons for it:

1. The CEO, Strategy Head/PMO/Chief of Staff is unaware that there could be a better way to deliver the 12 months or 36-month strategy.
2. The CEO, Strategy Head/PMO/Chief of Staff knows there is a better way, but reluctant to try and do the required change management.
3. The CEO, Strategy Head/PMO/Chief of Staff knows there is a better way, but don’t know the exact know-how.

In case of option 2 & 3, companies either hire an independent consultant or hire a big consulting firm to help them. Today with the help of technology backed solution, companies can deliver their strategy on a year-on-year basis without much external help. The only thing which is required is the willingness to change and try – because “if you will not change, nothing will change”.

Is OKR a New Management FAD ?

Photo by bonneval sebastien on Unsplash

In the last 30 years, many concepts were introduced in the companies claiming to have been that final solution that it will accelerate business growth. As part of these, concepts like Enterprise Performance Management, Business Process Management, Balanced Scorecard, and Knowledge Management where introduced in the market and promoted by consulting companies & leading business schools of the world. But they had a low impact on revenue growth, enhancing customer satisfaction and launching new products faster. And have only increased the revenue of consultants & consulting companies.

Nowadays OKR (a goal-setting framework for CEO and companies to get execution done) seems to be the hot topic. And every CEO is talking about implementing the same in their company. OKR is a part of the debate that companies need to adopt agile management practices; so that companies can respond to changing market dynamics faster.

New entrants, especially from developing markets and technology sector companies are moving into traditional companies and leveraging the power of Software+Hardware to disrupt the existing business models. And this is happening right now.

Let’s look at a few statistics that illustrate these changes:

  • A third of Fortune 500-companies in 1970 were gone by 1983. And many of those that were in the top-10 in 2015, didn’t even exist ten years before that.
  • The attrition in leadership positions in big companies has more than doubled in the past 10 years.
  • Google, Microsoft, Amazon, NetFlix, Uber and AriBnB are replacing the Coca-Cola, Big Retail, Media House and Established Hospitality industry Companies as most valuable companies.

Though these 20 year old new-age organizations are leveraging technology to deliver the product/services, they are also challenging the traditional management practices. They are adopting new agile principles and practices that enable them to remain closer to their customers, build a more transparent company and build a culture of thinking, planning and execution in their teams which enable them to move faster than existing traditional mindset companies.

But does this mean that every organization must adopt agile management practices and implement goal-setting frameworks like OKR. To answer this, we must under from where the “agile” as a concept came from.

The agile as a concept was first introduced around 2001 to better deliver the software. Before the agile practice came to picture, software’s were delivered to customers using the waterfall model of development. With the waterfall model, customers used to get the working software after 9 to 12 months. And by the time, they have received the software, customer requirement and business process to which the software was catering has changed. At the end, customer end up paying millions of dollars for something which was not near to what is required.

Then came the Agile way of delivering the software, in which software was delivered every 2 weeks. The customer gets the working software every 2 weeks. And the software developers adjusted to the evolving needs of customers. This resulted in customer end up spending less money and is more satisfied with something tangible for what he is paying for.

I have personally developed the software under the waterfall model and agile models. Frankly, adopting agile mindset was very difficult and was a change. People resisted it because it forced them to be on their toes, be more focused & accountable and forced then to be more collaborative across various teams. And you are clearly able to identify who is not performing within 2 weeks.

Now let’s look at the organizational age-old practice like “annual practices of budgeting & planning” and how it gets delivered by people in the company. Leadership team meets before the start of the financial year, sales targets are negotiated, CEO and management pushed for higher numbers and sales heads push back the numbers given and tried to freeze targets which can be achieved. New initiatives that needs to be completed are decided and everyone goes back happily to the workplace next day.

Think of your annual budget and planning process as software. Currently most companies are trying to deliver the budget & planning by following the waterfall model. A better way is to follow the agile way of quarterly process which is aligned with the company annual budgets & initiatives to be completed. Objectives (a.k.a goal) & Key Results(a.k.a milestones or action plan) to achieve the annual plan are created executed, reviewed & updated every quarter.

Frankly, achieving business results (sales plan, marketing plan, strategic initiatives) are different from programming a software. Unlike software programming, you might or might not achieve result (0 or 1) in a day, week or 2 week. But creating the OKR plan at the start of every quarter and reviewing it every month, will help you understand that will the outcome be achieved or not. Or enable you to understand that if you are all this time, trying to achieve the wrong outcome. The current execution design followed in companies leads people to focus on outcome rather then focusing on input that will lead to that outcome.

If I connect the dots, I have no doubt that adopting the agile management practices and frameworks like OKR(Objectives & Key Results) are much better approach to deliver the required business outcomes. What you think?

 

Building the Execution Culture!

When we started qilo’s journey, we had one single focus and agenda. How can we help companies perform better! During this journey, we met hundreds of leaders across industries and geographies. Did research with over 5000 people – Here are some learning’s from the experiences we got;

Execution Accountability

One theme, which clearly emerged as inputs from the leaders, was execution accountability. On an average a management team invests thousands of critical man-hours in boardroom/ meeting rooms, the question to be asked, are they genuinely productive?

Over 90% of the respondents we asked this question said no. So what could be the reason?

  • Lack of belief/ Clarity in the Vision
  • Limited say in creating the plan
  • Fear of conflicts
  • Yes Minister Syndrome
  • PTB- Passing the buck
  • Limited know how

Recently there has been a trend in companies that divide the workforce into 2 buckets – Planners and Doers. In some companies, they work as a team and in some still hierarchal. Depending on their culture, I have categories them as following types

  • The Houdini’sType – This team pops up while creating an annual plan and asks for data from across functions and post creation of the plan does a vanishing act. And to be seen during the review meeting sometimes. These type of companies build 2 classes amongst team (unknowingly) the corporate and rest of others.
  • Living on the edge Type– these are a set of companies, who do not believe in strategic planning or vision and find it a waste of time. (Believe me, they do exist and in masses.) These companies focus on a month-to-month plan with no strategic vision. Some of them pretend to be non-conformist (Strategy Atheist) but deep inside they lack know how at a leadership level.
  • King with the golden robe Type– These are set of companies where decision making resides in one corner office. Whether the company is doing well, bad is decided upon which side of the bed the king woke up from. The companies are highly perception and ego driven. The single focus for the teams is to please the king.
  • The Change Makers– they are a group of people closely aligned with the purpose and leaders vision. They fail together and succeed together. These companies align their teams with their purpose first and the drive execution accountability. They work in a network of teams and the leadership team rolls us the sleeve whenever required and run the shop floor.

Globally, the shelf lives of companies are getting shorter and shorter. Product Power and Proprietary Power will not just be enough. The key differentiator of a company will be the way you work and get the Strategy Execution done.

Always remember the pace and the quality of execution will decide if your team is working for you or your competitor!

 

 

 

Preparing your company for next level of growth

As a CEO/Founder, you have already taken your company from point A to point B. You have survived the initial 2 to 5 years of journey to build a company. Now you clearly understand what kind of people will be able to work with you and in your company, and most importantly you are revenue positive too.

Now it time to scale your company and take it from point B to point C. And this kind of scaling comes with its own kind of challenges. It’s the time you must bring in more experts inside your company especially at the leadership and mid-managerial positions. And most importantly, allow them to run the show on your behalf. Since people will be executing things on your behalf and you will move from PUSH to PULL mode of execution, you must invest heavily in the organization, people efficiency & effectiveness. The 3 most important work areas for you apart from arranging capital to support execution are

  1. Hiring right kind of people.
  2. Constantly aligning People beyond Leadership with your Strategic and Annual Business Plan.
  3. Investing in people efficiency and effectiveness.

1. Hiring right kind of people

Hiring the right people is the core of every business. It makes sense to outsource your hiring if you choose to remain small. To grow your business from point B to C, you need more people.

It starts with investing in the right kind of talent acquisition team who will be in charge of hiring the right people for you.  And making sure your existing people are accountable for hiring the right people. And make your talent acquisition team accountable for hiring the people with right kind of behaviors.

The first step of hiring the right kind of people is to create the data-driven process of hiring. You create the Interview Score Cards which are easy to be understood by employees who are hiring on your behalf. These interview scorecards are created for each department separately.  Even if you don’t want to score people, just identify the required skills and required behaviors specific to your company and mark it yes and no.

Interview Scorecard

Skill/Competency Score by

Team member 1

Score by

Team member 2

Skill-1
Skill-2
Skill-3
Skill-4
Behaviors
Behavior – 1
Behavior – 2
Behavior – 3
Behavior – 4

 

Example : Hiring a Sales Manager

Skill/Competency Score by

Team member 1

Score by

Team member 2

Ability to hiring the Sales People
Ability to train the new Sales People
Ability to pitch the product/service with clarity
Negotiation Skills
Ability to Build Relationships
Behaviours
Realistic and Rational
Open Minded/Open to Change
Ability to Learn new things
Disciplined to the core
  1. Constantly aligning People beyond Leadership with your Strategic and Annual Business Plan

Probably Strategic Business Plan and Annual Business Plan(also called Annual Operating Plan) are big jargonish words for you. Many first-time entrepreneurs & CEO’s don’t understand them, and many feel that it’s a corporate company thing.

Strategic Business Plan(SBP) is about what you as the founder(s) & CEO want to achieve in next 3 to 5 years. Its about what point “C” looks like. If you don’t want to put in detailed SBP, you can simply put in place 3 to 5 statements indicating what as a company you want to achieve in the next 3 to 5 years. Draft these statements and get these statements validated by your leadership team.

Annual Business Plan(Also called Annual Operating Plan) is about how as a company you have to performance in a particular financial year to meet your Strategic Business Plan. Many companies break down their revenue targets till sales executive level and think they are done with it.

And many do create a plan beyond achieving sales number during their annual offsite; but post that CEO struggles to see the action plan and execution on that action plan. Here is a quick step-by-step process to set your Annual Operating Plan and to make sure execution happen on that plan.

  1. Before annual offsite, share the 3 to 5 statements that describe what needs to be achieved in that financial year. These 3 to 5 statements should be linked(aligned) with your strategic business priorities.
  2. Validate these annual priority statements with your team before going to onsite.
  3. While you are preparing for the offsite,  ask the team now to come up with 1 to 5 projects & goals for the next 3 to 6 months that will help the company to achieve these annual priorities.
  4. During the offsite, the entire leadership team validates those projects. And put in place the action plan & milestones to achieve those projects & goals.
  5. Post offsite, leadership team discuss, validate and correct these projects with their respective teams. And put this plan in action for execution.

Though this sounds simple, making sure that the team remain focused on drafting the projects and milestones to achieve those projects. You need to put a person in charge who will own this entire end to end process & activity. Usually, this person has a very good understanding of your business horizontally and to whom rest of the team members will listen to.

Frameworks like Objective and Key Results (OKR)  can help you in achieving how to creating the strategic and annual plan and how to link people and execution with this plan.

  1. Investing in people efficiency and effectiveness

This is the part where most of the CEO fails to do a good job. And end up hiring the team of consultants/guru who end up giving you ready to eat meals which probably don’t work for your company. Organization effectiveness and efficiency is majorly about:

  • 3. a) Properly defining the business KPI’s & Projects to achieve your achieve your Annual Business Plan.And then making sure execution happens on to achieve those KPIs and Projects.
  • 3.b) Investing in tools that enhance productivity and get work done.
  • 3.c) Enhancing leadership capabilities through training or workshops

3.a) Properly define the business KPI’s and Project:

Most employees hate taking accountability towards what needs to be achieved by them in a company. And most managers take the decision of who is making progress and who is not based on perception; not on data. When the company invest time in setting up the process to define KPI’s and projects to achieve execution properly, it enhancing decision making, transparency from top to bottom and reduces biases between teams and across the company.

3.b) Investing in processes and tools to enhance productivity: The next question to answer is what kind of tools are required by employees so that it can enhance & accelerate the execution on business KPI’s and Projects to be executed. Many companies invest time in drafting a plan, but only a few invest time and resources in making sure that the plan gets executed. At company level you primarily need 3 kinds of tools :

  • One that enhances execution on your Business KPI’s and Projects. Example: CRM’s, Project Management tools, Goal-setting tools, Task management tools.
  • Second is that help the company in enhancing customer centricity. Example: Tools to measure customer satisfaction, tools to listen to customer voice/opinions and tools to provide awesome customer support.
  • Third are tools that reduce administrative work. Example: Financial Support Systems, HRMS etc.

Not all listed tools are required immediately. You need to decide which tools are more important and which can be implemented later. Another important point here is, many of these tool implementations fail for many companies. This happens because of many reasons. I am listing down few of them for you:

  • Company is not able to define the requirement clearly and you end up buying something which doesn’t fulfill your need.
  • An Owner and internal champions are not defined who is responsible for successful implementation.
  • Vendor is not helping the company to identify their requirements.
  • Company doesn’t go into the detail on evaluating the tool in detail and don ask the right question.
  • A UAT (User Acceptance testing) is not done properly against the requirement before rolling out to the larger audience.
  • Not leveraging vendor expertise in implementing solution successfully.
  • Owner of implementation is more bothered about her learning from the implementation than successful implementation.

3.c) Enhancing your leadership capabilities through training or workshops

The first few training or brainstorming sessions you need to invest are in:

  • Visioning Workshops
  • Team Alignment workshop
  • Building accountability across company workshop

Visioning: In a 1996 HBR article, James Collins and Jerry Porras showed that companies with a strong sense of vision had outperformed the others in the stock market by a factor of 12 since 1925! Vision reflects what we care most about and is derived from our sense of purpose and values. It provides meaning, attracts commitment, and focuses human energy by drawing on our deepest yearnings in striving towards a purposeful goal. Visions provide a clear, easily understood image of a better future. Strong visions inspire employees. They embody values & behaviors, provide people in the company the purpose, and direct them to what will be different and distinctive.

Team Alignment : The biggest challenge we have seen while implementing qilo is that of alignment towards the annual and long-term goals of the company. A simple test of this is to “ask your employees what are the 3 to 4 things the company wants to achieve in this financial year”.  Almost 80% people in the company fail to answer this. This is CEO and leadership failure, not employee failure. With alignment workshop, focus on communicating what company wants to achieve and help people align their work with CEO’s agenda.

Accountability workshop: Accountability means I will deliver the expected results from me, come what may. I will collaborate with people across teams and will not wait to be lead by someone to get work done. Building the behavior of accountability is far more difficult. And that the reason companies prefer people from top institutes and people with the excellent academic record because it shows that the likelihood of this person being accountable for execution is very high. But every company doesn’t have access to these people, and the best way to build this behavior is to constantly communicate about the importance of the same across the company.

Summary

  1. Invest in setting up the strong process and people who hire on your behalf.
  2. State your strategic business priorities in 3 to 5 statements.
  3. Draft 3 to 5 statements that will summarize your annual business plan. And link these statements with your strategic business plan statements.
  4. Invest in enhancing your leadership capabilities. And invest to set up processes and tool to enhance people productivity.