Should Your Board Interfere with Company Strategy?

There’s a whole school of thought which
states that boards should leave strategic thinking to executives. Instead,
board members should only provide oversight. Does this point of view have
merit?

The COVID pandemic has thrown companies’
strategies in disarray, whether they are NGO’s, public or private sector
organizations. Suddenly, reliable bedrock beliefs have been suspended as
evidence pours in that a new normal is being born.

Too many boards are caught off-guard.
Believing that strategic concerns are the purview of executives, they have
taken a hands-off approach to recent events. For some time, many have never
been regular attendees at their own board meetings. In some of our strategic
planning retreats, they either decline to attend, fail to show up, arrive late,
leave early, or spend the entire caucus distracted by email. 

In other words, pre-COVID, they stopped
providing strategic direction. Unfortunately, too many of them are public
sector bodies.

Instead, they offer to ensure that the
resulting plan is faithfully followed. They don’t want to “interfere.”

The folly of this thinking has recently
become apparent. Here’s why.

1) COVID has collapsed the future

Our approach to running strategic planning
retreats encourages companies to look 15-30 years into the future. Sometimes
over protest, we explain the pros and cons of looking too far out, vs. not far
enough. The key is to choose a “Goldilocks” planning horizon: one that’s just
right.

Pity the companies which have chosen a
horizon which is too short. Why? They’ll have to restart their planning
process.

The truth is that organizations who chose
long horizons already planned for the changes COVID has made urgent. The only
difference is that the pandemic has brought the future closer: collapsing it.
All they need to do is change the timeline.

However, a company with a too-short
strategy would miss the ball entirely. They’d have to rethink everything simply
because of a tactical error in forming their plan. This is where board members
make a difference:  they are usually the
ones pushing for longer horizons. Their absence makes this mistake more likely
to occur.

2) Fresh New Eyes Are Necessary at the Top

The pandemic has shown us what it’s like to
be completely blindsided. However, it should also predict which individuals
will rebound first.

Those who are younger and newer to the
organization have an advantage. Just observe how they adapt themselves to the
use of an app such as Zoom which has assumed a central role in most companies.

Contrast this reality with some leaders. I
once worked with the head of communications of a large company who hid a big
secret – he didn’t know how to use Powerpoint. How he got to that position
without picking up a basic tool of the trade remained a mystery.

Boards need to challenge executives to keep
developing themselves. They should also welcome fresher, younger eyes into
their ranks to prevent companies from becoming stale.

As such, boards need to properly estimate
how in touch they are. Unfortunately, many fail to include digital strategists
in the boardroom so it becomes difficult to provide proper guidance on the most
challenging issues of the day.

3) Bringing Back the Best Employees

Today, CEOs’ are looking around the office,
shaking their heads and wondering: “Why did I ever think we needed so many
people?” Now, their suspicions have been confirmed: when some employees stayed
home, and contributed little, they weren’t missed. In other words, their
absence wasn’t a problem.

Can organizations simply cherry-pick the
best employees, pay them a bit more and let go of the rest?

I predict that the new normal will force
them to do so, within the limits of the labour laws. Outsiders may complain
that they are just being greedy. However, board members may

point to the need to survive the first
worldwide disruption in business to occur in our lifetime.

They are more likely to switch to a more
digitally-savvy workforce that can manage itself without being watched.
Individual salaries may rise by so doing, but the number of total employees may
fall. Overall productivity should increase even as payroll costs are cut.

Boards should also prevent executives from
rushing to return to a pre-COVID status quo which wouldn’t be sustainable. They
should have a well-established point of view developed from seeing the inside
operations of other companies.

These are trying times, and the cozy
collegiality of the board room must give way to the committed few who are
willing to take a stand in an effort to keep companies afloat. 

Organizations need their boards to jump
into the fray wholeheartedly. They must intervene to make the best of a messy
situation and play their part in crafting a strategy that serves all concerned.

Are you concerned about changes in your employee’s compensation related to COVID-19?

Has your executive team started to signal that, due to financial pressure, it’s time to consider cuts in payroll?

As an HR manager, you may be challenged by a new demand to cut costs related to the trauma caused by the current pandemic. If you have any concerns about how to proceed in these uncertain times, don’t miss the webinar on May 20th with Peter Hall.

But that’s not all. He’ll be following up the event with his own 5 week private coaching circle on CaribHRForum Community. It will be available by application only as the group will span less than 10 people. Plus, this is a complimentary offering.

Here’s more information on the program and an application link.

Peter is a former executive in human resources at both Red Stripe/Diageo and CIBC/FirstCaribbean International Bank.

What are your executive team’s post-COVID assumptions?

Is your company being undermined by obsolete assumptions held by some of your leaders? To move forward, they must be challenged.

In our work to develop clients’ breakthrough strategies, we try to highlight such hidden assumptions. These are often unspoken, clashing ideas which undermine the corporate strategy. When the plan needs revision, the team should uncover and sort out these differences to act as one.

Unfortunately, most companies were rushed to respond to COVID-19 and created little more than a bunch of survival tactics. Now that the lockdown is being phased out, organizations must find a way to achieve their “new normal” if they hope to thrive.

However, as they do so, they need to look past the relatively simple task of putting people back in front of their desks safely. A fresh strategy is required to suit the times. One approach is to explore the foundation assumptions which are now embedded in their old business model. For example, they should date the following common, future milestones.

  • New Coronovirus Case Level-Off Day
  • Active Case Reduction Day
  • Curfew Lifting Day Employee Separation Day
  • Remaining Employee Return Day
  • Customer Re-Opening Day
  • Border Re-Opening Day
  • International Flight Resumption Day
  • End of Social Distancing Day
  • Ro Below 1.0 Day (A measure of COVID-19’s contagiousness.)

Each of these public events signals a turning point in the crisis. While they are unknowable with absolute certainty, that’s not the main challenge. The problem is that executives in your company are likely to hold different estimates for each milestone. This discrepancy could just be an interesting curiosity, except that each individual is making daily decisions based on their personal understanding.

For example, if HR believes that Employee Return Day is on June 15th, but Customer Service commits to a Customer Re-Opening Day on June 1st, there’s a big problem. The company can waste time, effort and money if the two plans aren’t synchronized.

But this list of key dates is just a start. There are a number of other assumptions which only apply to your industry, or company which need to be unearthed. Here are some of the questions I have been urging clients to ask themselves. 
Q1 – What material changes have occurred in our business? Here, I recommend you brainstorm individually and then as a team. It’s no place for group-think – the tendency for people to conform to majority thinking. Focus on concrete changes which are tangible and can be measured.
Q2 – Why does the change matter? Here you must confront aspects of your business model which can no longer work. Query what will happen if you continue the old model in this new environment.
Q3 – If the change is permanent, what were the original assumptions that must be challenged? These were embedded in the old business model, perhaps never discussed. Now, you must make them explicit.
Q4 – What are the new assumptions? Given the data you have on hand, what will you assume moving forward?

Furthermore, to make sense of your predictions, also think in terms of “confidence”. For example, if your team believes that Border Re-Opening Day will be on September 30th, apply a confidence interval to this date. You may state: “We are 50% sure that the date will fall between September 1st and October 31st.” That’s very different from being “90% sure it will fall between September 25th and October 5th. “

This additional information helps you make better decisions, introducing added flexibility where it may be needed. Of course, this is just the beginning. You should continue the regular strategic planning process I have summarized in prior articles:

1. Create a current snapshot

2. Set a target month/year that will allow a breakthrough to manifest

3. Craft measurable outcomes

4. Backcast from the future to 2020, filling the gap with necessary actions and milestones

Finally, ensure that the context of the discussion is one of exploration and innovation. The fact is, there will probably never be another moment like this in your business. Discontinuities of this magnitude rarely occur more than once in a lifetime.

Needless to say, companies that don’t revise their baseline hypotheses will be left at the starting line. In like manner, those who allow their CEO to set a bunch of flaky assumptions by himself will also run last.

Take the opportunity to make the most of this crisis by challenging the assumptions that render your old business model and strategy obsolete. Get all the members of your executive team talking to arrive at a new baseline.

Feels uncomfortable? The fact is that you are making an educated guess, then taking a bet that you are right. Regardless, your organization needs you to make such commitments so it can find success within this pandemic. 

What are your executive team’s new post-COVID assumptions?

May 17, 2020

Is your company being undermined by obsolete assumptions held by some of your leaders? To move forward, they must be challenged.

In our work to develop clients’ breakthrough strategies, we try to highlight such hidden assumptions. These are often unspoken, clashing ideas which undermine the corporate strategy. When the plan needs revision, the team should uncover and sort out these differences to act as one.

To listen to this podcast, visit Source

Crisis Favors the Digitally Bold CEO

Why are top executives getting frustrated at their teams during COVID-19? One reason: it’s obvious to them that the company needs to become a digital operation. They may also be very demanding but don’t blame them: they alone can see a joined-up world beyond the pandemic that most subordinates can’t. In the past few years, my consulting firm has implored our clients to include a digital strategist on their boards, executive ranks and strategic planning retreats. Only a tiny few have risen to the occasion, adding someone (usually much younger) to strategy discussions, which seemed to be about a faraway future.

COVID-19 has changed the timeline.

As we scan the outputs of prior client retreats we see that the long-term plans they made were painfully slow. They imagined a gradual drift into a digital world where people’s behaviors would change eventually, imperceptibly.

Today, they must make changes to go online from offline in a matter of months. However, CEO’s are having a difficult time getting their executive teams to envision a future that even their youngest employees can see. Why?

In a nutshell, each company function is lost in its own silo. Marketing, HR, Operations, IT…each is unable to lead the way. The new vision is beyond their grasp because it requires joined-up thinking.  What should CEOs’ do to accelerate the process of forging a digital transformation?

1. Forgive Weak Repetition

Many top executives get mad when their functionaries simply try to copy the offline world to the one that’s online. For example, advertising on the internet involves more than putting up digital billboards. It requires an understanding of engagement psychology, content and technology which few possess. The average marketing department won’t know how to gamify an audience, or perhaps even how to create one.

But this is to be expected. And forgiven. While initial attempts are weak, they represent a certain level of willingness, and the start of a steep climb.

However, CEO’s must insist on an unprecedented level of cooperation right away. They need to role-model an eagerness to cross internal boundaries to discover ideas and talent wherever it may be found. For example, if the new receptionist has 10,000 followers on Instagram, pull her in!

2. Focus on Underlying Business Results

To overcome the initial disappointment, executives should encourage experiments which aren’t meant to replicate old processes, but still achieve the same objectives.

For instance, a company which is used to engaging its walk-in customers in ways that make the experience special, cannot offer the usual free coffee, air-conditioning and relaxed banter. Instead, they must ask themselves why those features worked and what emotions they were intended to evoke.

In like manner, pastors that relied on the right blend of hymns, testimonies and sermons to keep congregants coming back for more can’t rely on these elements.  In these times, they need to go beyond the superficial form of these activities and find the underlying benefit that is being delivered.

In other words, they must begin all over again. Unfortunately, Facebook, Instagram and Netflix are just a single click away, along with every other online church service in the world. The only hope they have of competing is to experiment and make mistakes to learn what will deliver the a similar experience via the internet.

3. Learn New Functionality

Recently, I hosted a virtual conference that attracted several hundred global registrants. Behind the scenes of the Time Blocking Summit I was forced to pick up new tools, and with it, unique capabilities I barely understood.

In retrospect, I can laugh at my mishaps running ads on Facebook, Instagram, Quora and Google, but I had to make an effort. It was the only way to apprehend the power of these tools, which have no equivalent in the offline world.

These capabilities are highly nuanced, able to break down old barriers. For example, think of your employees using WhatsApp and Zoom to organize themselves into cross-functional teams. They do so on their own time, without the involvement of management, training themselves to using these apps to create new connections across boundaries. In the offline world, it would have been impossible.

Case in point: companies now need a private, community forum to keep dispersed staff members together. Too many executives, stuck in “Mi nuh use them ting deh” social-media prejudices, can’t lead the charge.

The COVID-19 crisis favors CEOs’ who are willing to push themselves to learn uncomfortable lessons that used to be optional, theoretical or futuristic. Today, they need to be visible role models of learning in order to lead in these extraordinary times.