An example of dynamic leadership & Effective leaders understand need for strategy development

The best of business leaders share at least one very similar perspective – that the essence of their job is to get results and at the same time to build commitment to the organization’s culture and values.

By ALBERT A. VICERE
Scripps Howard News Service

http://www.abqtrib.com/shns/story.cfm?pk=CEOCORNER-02-13-04&cat=FF

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Effective leaders understand need for strategy development

By LILLIAN VERNON
Scripps Howard News Service

http://www.abqtrib.com/shns/story.cfm?pk=LILLIANVERNON-12-13-04&cat=FF

– For companies of any size in any industry, mapping out the future is perhaps the most important – and risky – thing a leader will ever do. These critical decisions will inevitably determine the financial health and welfare of the company. With so much at stake, a leader must be logical, methodical, and structured, yet open-minded to alternative perspectives. Having a good plan contributed to the success of my company.

Assembling a representative and diversified strategy team comprised of functional heads, senior management and employees will ensure there is input from all areas of the business. Having a comprehensive team in place is not enough to create an effective strategy. What is needed is a process. Here is a four-stage process:

– Present State of the Industry. During this stage, team members collect and process internal and external data from multiple sources relating to general industry characteristics, including industry trends, key players and their market strengths and weaknesses, current and future customer demographics, preferences, perceptions and future needs. The challenge is not to become overwhelmed by the amount of data. Implications drawn from this analysis don’t have to automatically spell out a strategic course of action. Data collection and analysis isn’t that cut and dry. All you really are looking for is to be pointed in the right direction.

– Present State of the Company. The focus during this stage is to analyze the organization’s core capabilities, i.e., those that set your company apart from its competition, as well as the strengths and weaknesses that have contributed or detracted from business performance. Data should come from employee and customer surveys and industry ratings. It’s important to ensure there is adequate data from which to draw accurate implications. Also, since this data gathering is internally focused, there is sometimes a risk of collusion among team members to sugarcoat data that may impugn them or their areas in some way.

– Future State. This stage requires making predictions based on the data collected in the previous two stages. The goal is to come up with three or four attainable strategic alternatives for the future. This requires relying on educated guesswork, which can be challenging.

– Strategic Choice. Once these alternatives are determined, the team can then evaluate them against a set of assessment criteria. Are the formal systems (e.g. Internet/Intranet systems, distribution networks, human resources information system, supply chain management systems) in place to translate that strategy successfully? How will this strategy affect the work that needs to be done in the short and long terms? How will the strategy impact employees? Will the culture hinder or facilitate the execution of that strategic alternative?

There are major implications in choosing the right strategy. The most effective leaders understand the importance of strategy development to the continued health and success of an organization and invest the necessary time, resources, thought, and energy into a comprehensive process.

(Lillian Vernon, a pioneer in direct marketing and retail, can be reached at asklillian(at)lillianvernon.com or visit http://www.lillianvernon.com.)

But there is little doubt that today’s senior leaders must carry out those responsibilities in an incredibly complex environment. Globalization and the information technology explosion have changed all the rules. And for many organizations, that means that cultures need to change and values need to evolve.

All this places enormous demands on today’s top executives. They must ensure that their organization meets increasingly rigid performance expectations while directing its adjustment to the new economic order.

They must orchestrate not only the development and deployment of new strategies and business models, but also the reformulation of corporate culture and values. That means they must design, develop, and execute initiatives that simultaneously help the organization to get results, reshape culture, and develop leadership depth.

The most astute leaders know that no single individual is up to this challenge. It requires a team of energetic, capable people to help create and manage the initiatives that drive change across the organization. It helps if the team is comprised of both business leaders and human resource development experts. And it is essential that the members of the team have a real feel for the people, the culture, and the organizational climate.

A great case study is 3M in St. Paul, Minn. Following a few years of stagnant performance, the company has been on a roll over the past 18 months. Much of the impetus for their improved performance has come from a new strategic focus coupled with a set of leadership and organizational development initiatives championed by CEO Jim McNerney. While preserving the innovative spirit that has made 3M one of the most venerated companies in the country, McNerney has managed to make 3M an efficient, streamlined, high-performing organization.

The flagship change initiative at 3M is its Accelerated Leadership Development Program (ALDP). That initiative was designed and is coordinated by a team of 3M human resources professionals headed up by Margaret Alldredge, staff vice president of leadership and learning. That team has involved McNerney and a number of 3M senior executives as advisers, helping to create focus and energy around the company’s new strategy and business performance initiatives.

More than two dozen of 3M’s senior executives have been involved as teachers in the program. Often they’ve been paired with professors and other external experts to help them perfect their leadership points-of-view and hone their communication skills. McNerney himself joins each session for a couple of hours, using the opportunity as a platform for making the case for change at 3M.

In 3M’s 2002 Annual Report, McNerney noted in his letter to shareholders, "the Accelerated Leadership Development Program, now in its second year, continues to inspire and energize participants and senior management alike.

Its dynamic content and interactive format are energizing leaders from around the world." The company needed to change. A new strategy and direction was defined. The ALDP team created a forum to get the ball rolling for 3M.

The 3M example shows just how leaders can create focus and drive momentum during times of change. It starts with a commitment at the top and a clear direction. It involves cross-organization teams of individuals who champion the effort. Those teams create initiatives that help to communicate strategy, focus behaviors, and drive change. And when done well, they drive business results – the best measure of success for any endeavor.

(Albert A. Vicere, one of the country’s top leadership coaches, is a professor of strategic leadership at Penn State’s Smeal College of Business and president of Vicere Associates Inc. Visit http://www.vicere.com.)