Be More Strategic in Business. Diana Thomas
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direct or indirect link truly doesn’t exist, then you need to ask why you’re doing it.
When it comes to analyzing data and showing business results, the answer is simple: if you don’t already have a plan for evaluating your investments and decisions, you need one. That plan can be simple or robust, but it must be executable and help guide your strategic decision-making. Without understanding the impact of what you’re doing, you’re adrift. In your role, you may not need to have strong quantitative capabilities yourself, but business acumen and analytical awareness are critical leadership skills. Understanding analytics enables you to use data to drive change for winning results. Other leaders will take you seriously when they see that your decisions are fact-based and designed to move the company in the right direction. Leveraging all types of data when making decisions is a key component of strategic leadership, and it also empowers your organization by providing other leaders with data they need to build a truly competitive and innovative organization.
Leveraging all types of data when making decisions is a key component of strategic leadership.
You make decisions in life every day, some big and some not so big. Making an impulse purchase of a candy bar in a gas station is a decision that takes almost no thought. The cost is low, so even if you end up regretting the purchase, you aren’t out much. Most people don’t, on the other hand, buy an expensive sports car on impulse. You shop around, planning out where you’re going to store it and how you’re going to budget for all the higher ongoing costs of ownership—maintenance, tires, premium fuel, insurance, etc. In your own life, these details are usually easy to see and think through. As you get higher in an organization and have more responsibilities, you can’t immediately see all the details yourself. This is why strategic leaders use data to monitor what’s going on and make proactive changes when things aren’t going the way they should.
A winning organization—whether it’s a large corporation, a small mom-and-pop business, a start-up, a department, a team, or some other functional grouping—operates in alignment with the business. It has a vision and mission that are closely connected to corporate strategy, and everyone on the team is aligned to that vision. People on the team are enthusiastic about supporting the vision because they understand how their work connects to the organization’s success. Who doesn’t want to be part of a winning organization? The leader has an active, strategic role at the executive table and consistently steps back from everyday operations to evaluate everything the organization is doing. The leader makes sure all relevant stakeholders are informed, understand the desired impact, have their needs met, and play their part in enabling the organization to do its job. Further, everything a winning organization is doing is in some way making a needed impact on the greater business. When impact on the business misses the mark, the leader has the data necessary to identify the miss and moves quickly to remedy the situation. A winning organization’s leaders are agile by evaluating what they’re doing based on its impact on the business, making data-driven decisions, and making proactive efforts to change when change is warranted.
A strategic win drives the company’s performance in some fashion. To get specific, you and your organization need to decide what defines a strategic win. The important thing is to make those decisions at the outset, because you won’t know you’re winning if you haven’t defined success in the first place. The Impact BlueprintTM6 presented later in this book will be a great help in defining success and identifying the big-picture macro wins, as well as the micro wins that tell you if you’re making progress along the way.
Here are some examples of strategic wins.
Honeywell’s response to economic recession
The traditional school of thought about recessions is to restructure the workforce, that is, lay people off. When business softened, Honeywell’s CEO David Cote was reluctant to take this approach. He explains:
To understand that reasoning, look at what really happens when you do layoffs. Each person laid off gets, on average, about six months’ worth of severance pay and outplacement services. So in essence, it takes six months to start saving money. Recessions usually last 12 to 18 months, after which demand picks up, so it’s pretty common for a company to have to start hiring people about a year or so after its big layoff, undoing the savings it began realizing just six months earlier.7
A winning organization’s leaders are agile by evaluating what they’re doing based on its impact on the business, making data-driven decisions, and making proactive efforts to change when change is warranted.
Instead of restructuring, Cote and his team implemented a series of unpaid furloughs. The organization worked through some heavy challenges during the furlough periods, but in the end the company emerged strong. Employee morale stayed higher than it would’ve under layoffs, and as business began to pick up, the skilled workers were ready to jump back in. Cote’s leadership was strategic because he was able to see beyond the immediate pain of the recession. That, combined with some creative problem solving, put Honeywell ahead of its competitors when the economy was ready to grow again.
Educational assistance for employees
One strategic opportunity for McDonald’s Corporation was the education support program, which had a rather low participation rate. The original design of the program aimed to give employees throughout the organization the opportunity to earn a four-year degree, which seemed to the team who launched it to be a useful benefit. When the team surveyed the audience eligible for the program to find out why they weren’t taking advantage of the opportunity to get a four-year degree, they learned that the audience was still several steps away from that educational level. Many needed to complete a high school diploma or GED, and others felt that a two-year degree was more conducive to their goals. The team realized that the educational program would better serve this audience by offering pathways to a GED and/or two-year degree. Not only did they employ data to make this decision, but they asked the employees and partnered with outside organizations to find out how they had built their education strategies.
Improving workforce education levels also had the benefit of improving retention and strengthening the organizational leadership pipeline. Many employees were moving up through the ranks without a degree but eventually getting to a level where they needed additional knowledge and skills to meet the demands of the business world. Much of that was offered within the company, and the educational program helped to supplement internal training.
To continue winning and to employ the lessons learned from the tuition assistance program, the McDonald’s team decided that they would gather more direct data on the front end to design and deliver the most beneficial program possible.
Leadership’s pet project
A client’s organization was spending millions on a sales training program with little to show for it. Sales numbers remained unchanged. The CEO was friends with the owner of the small training company that provided the sales program and thought it would be a big win for his company. The rest of the team, with no emotional attachment to the vendor, wanted to cut the program, but the CEO continued to fight for it. In these kinds of situations, hard data is so critical to getting your message across. You must be able to show results (or lack thereof) in business numbers. For the sales training program, the group (including the CEO) compromised by letting the sales training run for six more months. If at the end of that period results continued to be unchanged, they all agreed to cut the program. The metrics of success were clear to everyone involved, and they were able to detach from the personal factors involved.
Creating a winning organization requires strong, strategic leadership. Based on our experiences, both in and out of corporate L&D, we’ve developed a leadership model that is a microcosm of the six factors for strategic leadership you’ll read about later in this book, and it will help you begin to think about the way winning organizations operate.
1.Align with a motivating vision that’s grounded in expectations. Defining